2023-05-20 10:22:07
“I still believe we will be able to avoid default,” Biden told reporters on the sidelines of the G7 summit in Hiroshima, Japan.
The Democrats and Republicans are engaged in a political battle whose economic title is linked to raising the ceiling of public indebtedness, without the possibility of reaching a solution before June 1, the date on which the US Treasury Department warned that Washington may become unable to pay. its obligations.
The Republicans, who hold a majority in the House of Representatives (one of the two houses of Congress), require that Biden initially pledge to make significant budget cuts in order to agree to raise the debt ceiling. For its part, the Democratic administration believes that the Republicans are turning a step that has always been routine into a political weapon in the face of Biden, with their eyes on the upcoming presidential elections in 2024.
Biden, who is in Hiroshima to attend the G7 summit, on Saturday morning received a briefing from his team on the talks.
On Friday, hopes for a soon solution receded, with both sides confirming that the negotiations are difficult.
Republican House Speaker Kevin McCarthy announced Friday night a “pause” in the negotiations, telling reporters, “Yes, we have to pause.”
This came shortly after a White House official revealed that there were “actual differences between the concerned parties on budget issues, and the discussions will be difficult.”
However, the talks resumed hours later, prompting White House spokeswoman Karen Jean-Pierre to confirm that the Democratic administration remains “optimistic.”
However, White House Communications Director Ben LaBolt reflected a less optimistic stance.
“Republicans are taking the economy hostage and pushing us to the brink of default, which could cost us millions of jobs and push the country toward (economic) recession after two years of steady job and wage growth,” he said in a press statement.
And stressing that Biden will not accept the Republicans’ “exaggerated” proposals, he stressed the possibility of charting “a path forward to reach a bipartisan agreement if the Republicans return to the negotiating table in good faith.”
negotiation “in stages”
The US government needs to borrow more money to continue spending, which means that the Republicans’ refusal to raise the debt ceiling will prevent it from fulfilling its obligations, which will have repercussions that are likely not limited to the United States.
Republicans believe that raising the public debt to more than 31 trillion dollars is a difficult measure to accept, and that it must agree to make cuts that allow for a greater balance between imports and expenditures, rather than just raising the ceiling of public indebtedness each time.
For their part, the Democrats do not oppose discussing budget cuts, but they refuse to make raising the debt ceiling a hostage to that. They stress that the priority before discussing any step is to ensure the ability of the United States to fulfill its obligations and maintain its financial credibility.
McCarthy stressed Friday that “we cannot spend more money next year.”
Democrats believe that the Republicans’ demands are driven by the agenda of the extreme right wing, which has come to dominate the party’s public policies.
White House communications director LaBolt warned that Republican demands for budget cuts would cause huge job losses and weaken the social safety net, in return for extending tax breaks for the wealthy.
In return, the Democrats propose raising taxes on the rich and accepting smaller budget cuts.
In his statements to reporters, Biden reflected his desire to complete the research with patience.
“This is a negotiation process, which takes place in stages,” he said. When asked if he was concerned, he added: “Not at all.”
Biden will return to Washington Sunday after the G7 summit, and he canceled two visits that he was scheduled to make in its wake, to Australia and Papua New Guinea, to shorten his trip and return in order to complete the talks on religion.
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