Biden-McCarthy meeting yields no debt ceiling deal, but speaker says markets should be encouraged


U.S. House Speaker Kevin McCarthy (R-CA) talks to reporters after he met with U.S. President Joe Biden to discuss the federal debt limit and spending, at the White House in Washington, February 1, 2023.
Kevin Lamarque | Reuters

WASHINGTON — House Speaker Kevin McCarthy said he had a “very good discussion” with President Joe Biden at the White House on Wednesday about the looming debt ceiling and federal spending.

“We have different perspectives. But we both laid out some of our vision of where we’d want to get to. And I believe, after laying them both out, I can see where we can find common ground,” McCarthy told reporters at the White House following the meeting.

The Democratic president and the California Republican talked for over an hour, and while there were “no agreements” and “no promises,” McCarthy said they would continue their conversation. The White House readout of the meeting reflected McCarthy’s sentiments, stating the two had a “frank and straightforward dialogue” as part of an ongoing conversation.

The Biden administration repeated a familiar phrase that the president is “eager to continue working across the aisle in good faith,” but stressed that he does not intend to negotiate on lifting the debt ceiling.

“It is their shared duty not to allow an unprecedented and economically catastrophic default,” the White House statement read. “The United States Constitution is explicit about this obligation, and the American people expect Congress to meet it in the same way all of his predecessors have. It is not negotiable or conditional.”

The House speaker later said the meeting had gone better than he expected. McCarthy added that he believes investors should feel better about the prospect of an agreement to avoid a first-ever default on U.S. debt.

“I would feel better, if I was the markets, based upon the meeting I had today,” he said, according to Punchbowl News.

The Treasury Department has launched a series of extraordinary steps to keep paying the government’s bills, and it expects those measures will be enough to avoid default at least until early June. But if Congress doesn’t raise or suspend the debt limit by then, it could wreak economic havoc around the world.

McCarthy has held the position that the two parties need to agree to cut back on spending before lifting the debt ceiling. The White House said the president agrees that addressing the national debt is a priority, but it should be a separate conversation.

“The President welcomes a separate discussion with congressional leaders about how to reduce the deficit and control the national debt while continuing to grow the economy. This conversation should build on the President’s leadership in delivering a record $1.7 trillion in deficit reduction in his first two years in office,” the administration statement said.

This is a developing story, please check back for updates.

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