An optimistic President Joe Biden declared on Wednesday he is confident the US will avoid an unprecedented and potentially catastrophic debt default, saying talks with congressional Republicans have been productive. He left for a G-7 summit in Japan but planned to return by the weekend in hopes of approving a solid agreement.
Biden’s upbeat remarks came as a select group of negotiators began meeting to try and hammer out the final contours of a budget spending deal to unlock a path for raising the debt limit as soon as June 1. That is when the Treasury Department says the US could begin defaulting on its obligations and trigger financial chaos.
“I am confident that we will get the agreement on the budget and America will not default,” Biden said from the Roosevelt Room of the White House. Later Wednesday evening, negotiations resumed behind closed doors at the Capitol.
Democrat Biden and Republican House Speaker Kevin McCarthy have traded blame for a debt-ceiling impasse for weeks. But Biden said of the latest White House session with congressional leaders that “everyone came to the meeting, I think, in good faith.”
McCarthy was upbeat, too, though contending Biden had given ground. The president said the budget talks were still separate from the debt limit issue, but the speaker said Biden had “finally backed off” his refusal to negotiate.
“Keep working — we will work again tonight,” McCarthy told reporters later. “We’re going to work until we can get it done.”
Biden said that every leader at Tuesday’s Oval Office meeting — Vice President Kamala Harris, McCarthy, House Minority Leader Hakeem Jeffries, D-NY, Senate Majority Leader Chuck Schumer, D-NY, and Senate Minority Leader Mitch McConnell, R-Ky — agreed the US must not default on its obligations. “It would be catastrophic for the American economy and the American people if we did not pay our bills,” Biden said.