The clock ticks away toward June 1 when Treasury Secretary Janet Yellen stated in a letter to Congress that the nation would hit its borrowing limit. Barring President Joe Biden flinching and offering a compromise with congressional Republicans, the U.S. would default on its debt around that time.
The Congressional Budget Office (CBO) warned earlier this month that the debt ceiling could come sooner due to lower than expected tax receipts.
The president bailed on attending an important summit aimed at addressing China’s expansion in the Pacific to negotiate with Republicans over the limit.
“How do MAGA Republicans choose to repay those who fought to defend our country? They are proposing cutting veterans’ health care funding, which would result in as many as 30 million fewer veteran outpatient visits,” Biden tweeted on Sunday.
Republicans deny their plan would cut veteran benefits. The president faces pressure from the Left-wing of the Democratic Party to hold the line against Republican proposals.
Biden wants a “clean” debt-limit bill that would increase the debt ceiling without any corresponding cuts in the rate of increase of the budget, which Republicans led by Speaker Kevin McCarthy are demanding.
“It doesn’t seem to me yet they want a deal,” McCarthy accused the White House of to reporters last weekend. “It just seems like they want to look like they are in a meeting, but they aren’t talking anything serious. … It seems more like they want a default than a deal to me.”
Joe Biden: False Talking Points on Default
Joe Biden and the Democrats have argued that Republicans are the ones playing politics because they voted to raise the debt ceiling three times while Donald Trump was president. Former Trump Chief of Staff and Office of Management and Budget Director Mick Mulvaney noted on Twitter that the debt ceiling ended up being raised because Democrats outmaneuvered Trump.
“I have enjoyed the narrative about how the GOP just raised the debt ceiling in 2017 — without negotiations. Interesting stuff. Not true, of course. But interesting all the same,” Mulvaney tweeted.
Mulvaney argued as a congressman and as Trump’s budget director that the Treasury Department should prioritize paying interest on the debt while delaying payments on other liabilities as a way to avoid default without raising the debt ceiling.
Trump and congressional Democratic leaders reached a deal to increase the debt ceiling in 2017 over the objections of Republicans including now Speaker Kevin McCarthy and then Speaker Paul Ryan. In 2019, Democrats controlled the House and the Senate, and forced Trump to rescind proposed reductions in the rate of increase of the federal budget when the debt ceiling came due.
Trump twisted Republican arms to pass the limit and avoid default.
Politico noted in 2013 that the nation was “born in default,” heavily indebted from the time of its founding.
Republicans Hold the Line Against Biden
Reports suggest that the speaker is willing to consider extending the limit until 2025.
The Republican plan that passed the House last month would cut the rate of the growth of the federal budget by $4.5 trillion. It would sacrifice green-energy programs that many Democrats consider sacred. It would also return unspent COVID funds to the U.S. treasury.
“After months of delay and wasted time from President Biden, negotiations are finally happening because Republicans are united behind a responsible debt limit increase. Now, he has 15 days to avoid being the first president to default on the national debt,” McCarthy said in a tweet Wednesday.
Biden had avoided negotiating with Republicans until reality forced his hand.
“[T]hey’re negotiating now and they weren’t doing it before,” House Rules Committee chair Tom Cole told Axios.
Deal Likely as Deadline Approaches
Public posturing and rhetoric has given way to talk of private concessions. Washington has a way of waiting until the last minute to announce deals. The Washington Post noted that an emerging deal to extend the debt limit until 2025 would be hailed as a victory for the White House.
The White House is rumored to be considering a concession that could allow for increased drilling, new spending limits, and the rescinding of unspent pandemic funds to avoid the instability of default. Biden appears ready for compromises that he has not up until now publicly been willing to discuss.
“Congressional Republicans have not been willing to discuss raising revenues, but policy differences between the parties should not stop Congress from avoiding default,” Biden told The Washington Post.
John Rossomando is a senior analyst for Defense Policy and served as Senior Analyst for Counterterrorism at The Investigative Project on Terrorism for eight years. His work has been featured in numerous publications such as The American Thinker, The National Interest, National Review Online, Daily Wire, Red Alert Politics, CNSNews.com, The Daily Caller, Human Events, Newsmax, The American Spectator, TownHall.com, and Crisis Magazine. He also served as senior managing editor of The Bulletin, a 100,000-circulation daily newspaper in Philadelphia, and received the Pennsylvania Associated Press Managing Editors first-place award for his reporting.