Days from a deadline, President Joe Biden and House Speaker Kevin McCarthy are narrowing in on a two-year budget deal aiming to curb federal deficits in exchange for lifting the nation’s debt ceiling and staving off an economically devastating government default.
The Democratic president and Republican speaker hope to strike a budget compromise this weekend. With Republicans driving for steep cuts, the two sides have been unable to agree to spending levels for 2024 and 2025. Any deal would need to be a political compromise, with support from both Democrats and Republicans to pass the divided Congress.
But the budget flow isn’t the only hang-up.
A person familiar with the talks said the two sides are “dug in” on whether or not to agree to Republican demands to impose stiffer work requirements on people who receive government food stamps, cash assistance and health care aid, some of the most vulnerable Americans.
Yet both Biden and McCarthy expressed optimism heading into the weekend that the gulf between their positions could be bridged. A two-year deal would raise the debt limit for that time, past the 2024 presidential election.
“We knew this would not be easy,” McCarthy, R-Calif., said as he left the Capitol for the evening Thursday.
McCarthy said, “It’s hard, but we’re working and we’re going to continue to work until we get this done.”
House Republicans have pushed the issue to the brink, displaying risky political bravado in leaving town for the Memorial Day holiday. The U.S. could face an unprecedented default as soon as June 1, hurling the global economy into chaos.
In remarks at the White House, Biden said, “It’s about competing versions of America.”
“The only way to move forward is with a bipartisan agreement,” Biden said Thursday. “And I believe we’ll come to an agreement that allows us to move forward and protects the hardworking Americans of this country.”
Lawmakers are tentatively not expected back at work until Tuesday, just two days from the early June deadline when Treasury Secretary Janet Yellen has said the U.S. could start running out of cash to pay its bills and face a federal default.
Biden will also be away this weekend, departing Friday for the presidential retreat at Camp David, Maryland, and Sunday for his home in Wilmington, Delaware. The Senate is on recess and will be until after Memorial Day.
Meanwhile, Fitch Ratings agency placed the United…
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