Biden and McCarthy to meet Monday for debt ceiling negotiations
Talks nearly fell apart over the weekend with Biden calling the GOP's stance 'unacceptable'
President Joe Biden said Sunday the GOP’s current stance on debt-ceiling talks was “quite frankly unacceptable” before boarding Air Force One to return to Washington DC.
"Now it’s time for the other side to move from their extreme positions," Biden added during a press conference before his departure from Hiroshima, where he spent recent days meeting with world leaders at a G-7 leaders summit.
Then, later in the day, both House Speaker Kevin McCarthy and a White House official confirmed that the two men spoke by phone Sunday as the plane traveled back to Washington and that they're set to meet in person Monday afternoon. In addition, their staffs are set to reconvene Sunday evening to restart talks after nearly two days without negotiations.
McCarthy added to reporters at the Capitol that the call had been productive but "there’s no agreement, we’re still apart."
In a television appearance earlier on Sunday, McCarthy claimed the recent turbulence in the talks has been a result of Biden shifting his proposal in recent days. "We were in a good place. He goes overseas, and now he wants to change the debate," McCarthy told Fox's "Sunday Morning Futures."
As negotiators seek to avoid a default that could shake markets and send the economy into a recession within days, the talks are largely stuck, with both sides offering recriminations and strikingly similar assessments.
"The White House is moving backward in negotiations," McCarthy tweeted Saturday evening just about 90 minutes before the White House released a statement saying the latest GOP offer "was a big step back."
The White House is moving backward in negotiations.
Unfortunately, the socialist wing of the Democrat Party appears to be in control—especially with President Biden out of the country.— Kevin McCarthy (@SpeakerMcCarthy) May 20, 2023
As recently as Saturday while he was still in Japan, Biden had downplayed problems in the talks, saying "it's a negotiation, it goes in stages.”
Talks stuck over spending and revenues
A key sticking point among many in the talks: spending levels.
The GOP proposal passed in April would cut discretionary spending to 2022 levels and then impose a 1% cap on future increases.
McCarthy said Friday if Democrats "think we're going to spend more money next year than the year we did this year, that's not right and that's not going to happen.”
The White House has said in recent days that Republicans are refusing to negotiate enough from their initial debt ceiling proposal, which passed the House but was dead on arrival in the Democratic-controlled Senate.
Biden and his team also continued to pitch raising revenue by closing certain tax loopholes - especially provisions around the fossil fuel and cryptocurrency sectors - even as Republicans flatly rejected the ideas.
"There's a lot of things that they refuse to entertain and they just said revenue is off the table. Well, revenue is not off table and so that is what we continue to have a significant disagreement on," Biden said Sunday. He added that he is willing to cut spending in addition to his revenue ideas.
During his remarks Sunday, McCarthy reiterated that Republicans will not discuss the revenue ideas Biden is pushing, saying "that's not where I'm at."
The talks have also been hampered by partisan divides across a range of issues, from new work requirements that the GOP is proposing around social programs, to energy permitting reform to efforts to "claw back" unspent COVID relief money.
Treasury Secretary Janet Yellen reiterated on Sunday that June 1 is still a "hard deadline" for raising the debt ceiling.
"I will continue to update Congress, but I certainly haven't changed my assessment," she said on NBC's "Meet the Press."
Sunday's back and forth comes amid growing energy on the left around two long-shot ideas to short-circuit negotiations, including a discharge petition as well as growing support for a legally questionable maneuver around the 14th amendment.
Biden addressed the 14th Amendment option again Sunday, saying he continues to look at the idea and "I think we have the authority." But he also reiterated a concern that if he took the controversial step, it would be held up in litigation.
“The question is could it be done and invoked in time,” said Biden, who is scheduled to arrive back at the White House late Sunday night.
This post has been updated.
Ben Werschkul is Washington correspondent for Yahoo Finance.
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