White House Chief of Staff Jeff Zients recently reaffirmed Joe Biden’s unwillingness to negotiate over spending cuts in exchange for raising the debt ceiling. This stance starkly contrasts with Biden’s role in the Obama administration in 2011, where he negotiated with congressional Republicans. Zients cited that time’s harmful “brinksmanship”, which he said had significant adverse effects on the economy and families nationwide.
Meanwhile, Sen. Joe Manchin (D-WV) criticized Biden for a “deficiency of leadership” in the current debt ceiling negotiations. Manchin’s remarks came after House Speaker Kevin McCarthy (R-CA) announced a forthcoming bill to raise the debt limit and cut back on spending. Biden and McCarthy have not sat down to discuss the debt limit since early February, with the president insisting that the debt ceiling should be increased without any conditions on his runaway deficit spending.
President Biden’s reckless spending created record inflation, made us more dependent on China, and undermined Social Security and Medicare. Since he's been in hiding, House Republicans will take action by passing a responsible debt limit increase. https://t.co/YS11O6kqtK
— Kevin McCarthy (@SpeakerMcCarthy) April 19, 2023
McCarthy’s proposed bill, dubbed the Limit, Save, Grow Act of 2023, aims to lift the debt ceiling by $1.5 trillion or extend it through March 2024. Additionally, the legislation outlines measures to raise work requirements for federal benefits, recover unused COVID-19 pandemic funds, and repeal the student loan forgiveness program, among other things. McCarthy asserted that with the introduction of a clear plan for a responsible debt limit increase, there is no excuse for the president to refuse negotiation.
In January 2023, the U.S. government reached its statutory debt limit, prompting the Treasury Department to employ “extraordinary measures” to maintain financial obligations. In a letter to congressional leaders, Treasury Secretary Janet Yellen stated that these measures could continue until June 5 but urged Congress to act quickly to avoid default.
Democrats, including former House Speaker Nancy Pelosi, criticized Republicans for using the debt ceiling as leverage for spending cuts, calling it “silliness.” Senate Finance Committee Chair Ron Wyden (D-OR) further accused Republicans of taking the economy hostage and demanded they back down on the debt limit. In addition, some House GOP hard-liners, like Rep. Andy Biggs (R-AZ), oppose raising the borrowing limit altogether.
However, the White House remains firm on its position. Press Secretary Karine Jean-Pierre this week dismissed suggestions that President Biden is responsible for the lack of progress on avoiding a U.S. debt default. Instead, she attributed the stalemate to Congress, specifically the “political stunts” by McCarthy and the MAGA wing. According to Jean-Pierre, it is the constitutional duty of Congress to address the issue and prevent a default.
McCarthy’s proposal faces significant opposition from Biden and the Democrats. The Biden administration insists that Republicans should agree to increase the debt ceiling without negotiations over any changes to budget policy.