WASHINGTON, D.C. – The clock is ticking for lawmakers to reach a deal on the debt ceiling. There seems to be some optimism in Washington that an agreement can be made before the June deadline.
After meeting with congressional leaders and just before President Joe Biden took off for a diplomatic trip to Asia today, he said he’s confident the US will not default.
The debit ceiling, also known as the debt limit, is the cap on the total amount of money that the federal government is authorized to borrow to meet it’s financial obligations. Those obligations are to pay for things like social security and Medicare benefits, military salaries, interest on the national debt, tax refunds and other payments. The Treasury Department said failing to increase the debt limit would have catastrophic economic consequences and can lead to a default, which has never happened in US history. A default could mean we could go through a financial crisis, people could lose jobs, their savings. Economists and the Treasury Department are really sounding the alarm on this.
Republicans have said they want to cut federal spending before lifting the ceiling but the president said negotiating on the cuts should not be a requirement for raising the debt ceiling. Speaker of the House Kevin McCarthy (R- CA) wants work requirements for government safety net programs like food stamps attached to any deal to increase the debt ceiling. Biden seemed to leave a little room for negotiation, but said he would not put people’s basic needs at risk.
“I’m not going to accept any work requirements that’s going to impact on medical health needs of people,” said the President. “I voted years ago for the work requirements that exist but it’s possible there could be a few others but not anything of any consequence.”
“It is encouraging that the white house is engaging seriously with the only counterpart to deliver actual solutions,” said Sen. Mitch McConnell (R- KY). “But because it took the president three months to start dealing in reality, we now have a time problem. So I’m hopeful the president’s team will join House Republicans to produce a responsible spending agreement to raise the debt ceiling. I’ll continue to support speaker McCarthy 100 percent.”
Biden is cutting his trip to Asia short so that he and congressional leaders can finalize this before the deadline. Congress has until June first to reach an agreement before we default.