Abrupt halt on debt limit talks as White House faces ‘real differences’
The Associated Press
J. Scott Applewhite/AP
WASHINGTON — Debt limit talks halted again late Friday at the U.S. Capitol shortly after resuming, another sudden turn of events after negotiations had come to an abrupt standstill earlier in the day when Republican House Speaker Kevin McCarthy said it’s time to “pause” negotiations, and a White House official acknowledged there are “real differences.”
Top Republican negotiators for McCarthy exited the brief meeting shortly after talks restarted Friday evening. They said there were no further negotiations planned for Friday and they were uncertain on next steps as Congress and the White House face a daunting deadline to resolve the standoff.
“We reengaged, had a very, very candid discussion, talking about where we are, talking about where things need to be, what’s reasonably acceptable,” said Rep. Garret Graves, R-La., a top McCarthy ally leading the talks for his side.
Another Republican negotiator Rep. Patrick McHenry of North Carolina, said McCarthy had also left for the night, and they would be briefing the speaker on the latest developments.
Asked if he was confident an agreement over budget issues could be reached with the White House, McHenry said, “No.”
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President Joe Biden’s administration is racing to strike a deal with Republicans led by McCarthy as the nation careens toward a potentially catastrophic debt default if the government fails to increase the borrowing limit, now at $31 trillion, to keep paying the nation’s bills.
Earlier in the day, McCarthy said resolution to the standoff is “easy,” if only Biden’s team would agree to some spending cuts Republicans are demanding. The biggest impasse was over the fiscal 2024 top-line budget amount, according to a person briefed on the talks and granted anonymity to discuss them. Democrats staunchly oppose the steep reductions Republicans have put on the table as potentially harmful to Americans.
“We’ve got to get movement by the White House and we don’t have any movement yet,” McCarthy, R-Calif., told reporters at the Capitol. “So, yeah, we’ve got to pause.”
The White House official, who was granted anonymity to talk about the private discussions, had said at that time there are “real differences” between the parties on the budget issues and further “talks will be difficult.”
The official added that the president’s team is working hard towards a “reasonable bipartisan solution” that can pass both the House and the Senate.
Wall Street turned lower as negotiations on raising the nation’s debt limit came to a sudden halt, raising worries that the country could edge closer to risking a highly damaging default on U.S. government debt.
The president, who has been in Japan attending the Group of Seven summit, had no immediate comment. Biden had already planned to cut short the rest of his trip and he is expected to return to Washington Sunday.
White House press secretary Karine Jean-Pierre said Biden had planned to be briefed on the negotiations by his team Friday evening. Biden had departed early from a Friday night dinner with G7 leaders in Hiroshima.
Negotiators met Friday for a third day behind closed doors at the Capitol with hopes of settling on an agreement this weekend before possible House votes next week. They face a looming deadline as soon as June 1, when the Treasury Department has said it will run out of cash to pay the government’s incurred debt.
Republicans want to extract steep spending cuts, arguing the nation’s deficit spending needs to get under control, rolling back spending to fiscal 2022 levels and restricting future growth. But Biden’s team is countering that the caps Republicans proposed in their House-passed bill would amount to 30% reductions in some programs if Defense and veterans are spared, according to a memo from the Office of Management and Budget.
Any deal would need the support of both Republicans and Democrats to find approval in a divided Congress and be passed into law. Negotiators are eyeing a more narrow budget cap deal of a few years, rather than the decade-long caps Republicans initially wanted, and clawing back some $30 billion of unspent COVID-19 funds.
