…By Larry John for TDPel Media.
President Joe Biden expressed confidence in resolving the US government’s debt ceiling crisis, stating that a deal was “very close,” despite the initial deadline being extended by four days.
As he departed from the White House to spend the Memorial Day weekend at Camp David, the president shared his optimism, stating that negotiations were ongoing and expressing hope for a timely agreement.
Treasury Secretary Yellen Adjusts the “X-Date”
Treasury Secretary Janet Yellen extended the “X-date,” the deadline for potential default, from June 1 to June 5.
Highlighting the repercussions of inaction, Yellen warned that failure to act by the new date would not only result in severe hardship for American families but also harm the country’s global leadership position and raise concerns about national security interests.
Biden and McCarthy Inch Closer to Budget Agreement
President Biden and Republican House Speaker Kevin McCarthy appeared to be narrowing down on a two-year budget-slashing deal that would extend the debt limit beyond the next presidential election, until 2025.
While Republicans have made progress in pushing for significant spending cuts, disagreements persist regarding McCarthy’s insistence on stricter work requirements for government food stamp recipients—a condition Democrats reject outright.
Negotiations Reach Crucial Phase
Earlier on the same day, Speaker McCarthy stressed that negotiations had reached a critical stage.
Any agreement reached would require political compromise and support from both Democrats and Republicans in order to pass through the divided Congress.
Consequences of Failing to Lift the Borrowing Limit
Failure to increase the borrowing limit, currently at $31 trillion (£25.1tn), to cover the nation’s accumulated expenses would have far-reaching implications for both the US and global economy.
However, some hard-right Republicans in Congress, aligned with former President Donald Trump, have long held doubts about the Treasury’s projections, urging McCarthy to remain steadfast in his approach.