President Joe Biden speaks about his economic agenda at the International Federation of Operating Engineers Domestic 77 training facility in Accokek, Md., Wednesday. (AP Photo)
ACCKEYEK, Md. (AP) — President Joe Biden blasted Republicans’ emerging quid pro quo plans to raise the nation’s debt limit only in exchange for spending cuts and other political concessions on Wednesday, declaring that Republican lawmakers are threatening a historic default on US commitments. “Unless I agree with all these clichés they have.”
His remarks in the union hall address came as House Speaker Kevin McCarthy, who has struggled for months to unite Republicans around a unified budget proposal, released a sweeping spending-control plan to present to the White House along with a $1.5 trillion debt-limit hike. . But it hasn’t been determined whether McCarthy has the 218 Republican votes — a majority in the House of Representatives — in favor of his proposal, which has no chance of becoming law in the Senate and is intended to start negotiations with the administration. Cruising toward crisis If Congress and Biden do not agree to raise the cap in the coming weeks, the government will be in danger of being unable to pay its bills and facing a devastating default on the economy. The segment presentations this week, which began with McCarthy giving a speech on Wall Street, vividly showcased how Biden and the speaker speak to two very different Americans. Standing in a garage and steel shop, Biden clearly noted the inconsistency, telling members of the International Federation of Operational Engineers, Local 77 that while “I’m here in Union Hall with you. Speaker McCarthy just finished speaking to Wall Street two days ago.”
Biden emphasized that severely restricting government spending programs could hurt a middle class that is already struggling to afford basic needs. and demanding concessions in exchange for paying off the nation’s debts ‘Worse than completely irresponsible’ Biden said so “America is not a dead nation.”
“People, this is MAGA’s economic agenda: spending cuts for working and middle-class people…with tax cuts for those at the top of the pile,” “Make America Great Again,” Biden said, referring to former President Donald Trump’s campaign slogan. “It’s not about financial discipline. It’s about cutting benefits for people… They don’t seem to care much.”
McCarthy commented similarly, “President Biden skips town to give a speech in Maryland rather than sit down to address the debt ceiling.” He also insisted that House Republicans are acting responsibly by insisting on curbing the spending habits of the federal government.
“If you give your child a credit card and they keep going over the limit, you won’t blindly raise the limit. You can change their behavior,” she says. McCarthy said. “The same applies to our national debt.”
The speaker took to the House floor shortly before Biden spoke on Wednesday and detailed the GOP plan. That would, among other provisions, recover billions in unspent COVID-19 relief money, cancel money meant to boost employment at the Internal Revenue Service, and halt Biden’s efforts to cancel up to $20,000 in student loan debt for millions of borrowers. The plan would reduce spending to 2024 levels, and impose a 1% cap on most future federal spending over the next decade. The proposed debt limit increase will continue until sometime next year, bringing the issue back into the spotlight during the presidential campaign. The California Republican says excess government spending is driving up inflation, empowering China and threatening the future of Social Security and Medicare. Biden and McCarthy, who need to work together for the sake of the American economy, are playing diametrically opposed strategies with different audiences, every bet he will win in the end. Insofar as the two men clashed with each other—without active negotiation yet—the sole aim was to provide fodder for attacks. McCarthy says Biden “stutter” in negligence not to meet with him; Biden responds to what McCarthy has already done “We threatened to become the first speaker to default on our national debt” Unless he gets what he wants in the budget. Complicating matters for McCarthy, he is facing pressure not to concede the position of the conservatives in their meager majority in the House of Representatives, who delayed his promotion to the position of speaker earlier this year. But Biden maintains that the spending cuts will put unacceptable pressure on the government’s ability to fulfill its constitutional responsibility to stand behind its commitments. He says the Republican Party’s belief in tax cuts has blown up the deficit. Under the Republican proposal, McCarthy said, the debt limit would be extended into next year. And he pressured the White House to negotiate a compromise with GOP lawmakers, noting that voters elected a divided Congress in the November midterm elections. So far this year, he said, Biden “The problem has been avoided for 77 consecutive days and counting.”
Both men are veterans of the nasty debt-reduction battle of 2011, when Biden was vice president and McCarthy was a relatively new member of the House Republican leadership. They know the dangers of approaching a debt limit deadline, such as the first-ever downgrade of the US credit rating that summer. For all situations, markets generally assume as of now that a deal will be struck as it has in the past. But since they talked to each other, they rarely spoke to each other. The new Republican president and speaker sat down in early February, but have had few substantive contacts since then. Instead, the White House has publicly pushed McCarthy to release a GOP budget plan detailing the proposed cuts — which Democrats say is anathema to voters. Meanwhile, the White House is siding with Democrats on Capitol Hill who are overwhelmingly adamant that no concessions will be made in exchange for a debt limit hike. It’s not clear whether McCarthy’s plan could get 218 votes – a majority in the House of Representatives – and whether he would have to add other changes – such as repealing the Democrats’ climate, health care and tax law known as the Inflation Cut Act – to convince holdout Republican lawmakers. A lot of the rhetoric now is political posturing ahead of the deadline to raise the debt limit before the US hits the ceiling, which is a moving target but expected in the coming months. The White House has only hardened its no-negotiation stance since Biden hosted McCarthy in the Oval Office, but most lawmakers and economists believe both sides will eventually avoid default. Wall Street firms – looking at the tax returns – estimate that the day of reckoning is near. Goldman Sachs estimated this week that “x date” Accessible in June, at this point “rare” The steps the Treasury Department has taken to keep the government running will wear off and the bills will start to fall unpaid. Both sides can tone down the rhetoric by committing first and foremost to the US government to avoid defaulting on its payments, said Brian Riedel, a senior fellow at the conservative Manhattan Institute. This can help build credibility and show goodwill in conversations.