McConnell calls for Biden to negotiate with McCarthy to avoid default: 'We're running out of time'

Brady Knox

May 09, 10:19 PM May 09, 10:19 PM

Senate Minority Leader Mitch McConnell (R-KY) called on President Joe Biden to negotiate with House Speaker Kevin McCarthy (R-CA) over the debt ceiling to avoid a default on the nation's national debt.

McConnell painted Biden as the arbiter in debt ceiling negotiations, saying he was the only one who could avoid a default. He urged him to accept the reality of a divided government and be ready to give up ground.

BIDEN SAYS HE'S 'CONSIDERING' 14TH AMENDMENT TO AVOID DEFAULT

"This can only be solved by the one person in America who can sign something into law and by the majority of the opposite party, in divided government," McConnell told reporters on Tuesday. "Hopefully that's the direction in which we were headed now because we're running out of time."

“The United States is not going to default. It never has and it never will,” he continued. “However, elections have consequences. We now have divided government; we didn’t have divided government last year.”

McConnell made the appeal beside McCarthy, who said negotiations with Biden during a meeting Tuesday afternoon didn't go far. McCarthy, unlike McConnell, didn't immediately rule out a default but cast himself as unable to affect the result either way.

“I've done everything in my power to make sure it will not default. We have passed a bill that raised the debt limit. Now, I haven't seen that in the Senate,” he said. “So, I don’t know.”

The United States risks defaulting on its debts if lawmakers can't come to a deal soon. Treasury Secretary Janet Yellen said the country could default by June 1 if the debt ceiling isn't raised.

Biden hosts a big debt ceiling meeting while insisting there's nothing to talk about

W. James Antle III

May 09, 07:00 AM May 09, 07:01 AM

President Joe Biden is set to meet Tuesday with House Speaker Kevin McCarthy (R-CA) and other congressional leaders about the debt ceiling standoff, but if you believe the White House, there is nothing to talk about.

“Look, there shouldn't be negotiations on the debt limit,” White House press secretary Karine Jean-Pierre told reporters Monday. “This is something that they should get to regular order and get to work on. We should not have House Republicans manufacturing a crisis on something that has been done 78 times since 1960.”

BIDEN INCHES CLOSER TO TALKING TO REPUBLICANS ABOUT THE DEBT CEILING

Jean-Pierre pitched the meeting as more of a Biden lecture. “So we're telling them — or saying to them: Do your job,” she said. “Pay for something that you've already spent on. That's it.” The message was similar last week.

“It is the president's job to also be very clear with Congress, with Republicans in Congress: You got to do your job,” Jean-Pierre said. “It is simple.”

“The question is to Speaker McCarthy, as I've said many times before here, is to — to the MAGA Republicans: What is going on here?” she added. “Why can you not get this done? It is simple. It is simple.”

“Let me be very clear: Congress needs to do its job,” budget director Shalanda Young concurred. “Tomorrow, they could put a bill on the floor to make sure we don't default. This is of people's own making.”

“As you know, the president is going to make clear that default has to come off the table, that he is happy to talk about spending priorities and who you value in this country, what our right tax policy is in this country, why every time we have this debate it has to go to working families in this country first in order to do the right thing for this country,” Young also told reporters.

In this telling, McCarthy and other congressional leaders are going to the White House for some coaching, and Biden is Bill Belichick: Do your job. There is no dialogue, only a monologue.

Young mocked this idea even while suggesting it would be Biden’s approach.

“Imagine if this president said, ‘Here's my budget' on March 9. 'If you don't take it all — lock, stock, and barrel, don't change your word, pass it without changes, I'd be willing to cause a recession and cost millions of people their jobs.’ That would be extreme,” she said.

At the same time, Young was saying Biden and his team did not view the only debt ceiling extension to pass a house of Congress, however narrowly, to be the starting point for the talks even though there is a risk of default sometime in June.

On the one hand, Young said Biden is “eager to have a separate conversation about the budget without threatening our economy.” On the other hand, “this is not some abstract debate.” The Biden budget, it seems, is better.

At Monday’s briefing, there were nearly a dozen instances of Jean-Pierre telling Congress to do its job, though some of those comments were referring to passing gun control rather than raising the debt ceiling without spending cuts.

This could all be posturing. In his 36 years in the Senate, Biden threw sharp partisan elbows in public and negotiated in private. He led the debt ceiling talks with House Republicans as vice president under former President Barack Obama, which did result in some spending cuts.

It is possible that Biden’s off-ramp will be an agreement on spending cuts passed through legislation separate from a debt ceiling extension or suspension. The White House invitation itself was a softening of the no-negotiations stance in response to a letter from Treasury Secretary Janet Yellen moving up the day of debt limit reckoning.

“I think that we have to make it clear to the American people that I am prepared to negotiate in detail with their budget,” Biden said in an interview with MSNBC on Friday night. “How much are you going to spend? How much are you going to tax? Where can we cut?”

At the same time, Biden and congressional Republicans are far apart on spending priorities. There is little trust between them that would allow for a quick debt ceiling extension to be followed by budget negotiations.

The White House meeting could also be about establishing blame, as Biden’s team has spent a considerable amount of time arguing that any default, with economic consequences that could prove as dangerous to the president as the GOP, is the fault of House Republicans.

Biden was elected as a legislative deal-maker extraordinaire. But don’t call Tuesday’s bipartisan meeting a negotiation just yet.

Mike Lee says Senate Republicans will back House GOP in White House debt limit fight

Emily Jacobs

May 08, 02:44 AM May 08, 02:44 AM

Sen. Mike Lee (R-UT) said on Sunday that the Senate Republican Conference will work to strengthen House Speaker Kevin McCarthy's (R-CA) negotiating position as he attempts to force President Joe Biden to negotiate a debt limit compromise.

Lee collected an impressive 42 signatures, not including his own, from his Senate GOP colleagues for a letter sent Saturday to Senate Majority Leader Chuck Schumer (D-NY) that voiced support for pairing a debt limit increase with spending cuts. Asked about the letter, which included Senate Minority Leader Mitch McConnell (R-KY) as a signatory, on WHD News's Sunday Morning Features, Lee said it was "imperative" McCarthy enter the White House "in a position of negotiating power."

GOP SENATORS TELL SCHUMER THEY WON'T VOTE TO RAISE DEBT CEILING WITHOUT SPENDING CUTS

"We’ve got not only the Republican conference in the Senate backing what the Republicans in the House passed the week before last, but we’ve also got a solid bloc of Republicans," Lee said. "[We have] more than enough to block any sort of so-called ‘clean’ debt ceiling bill from going forward, anything that raises the debt ceiling without substantive spending and budgetary reforms."

"Whenever you’ve got 41 senators who are unwilling to bring debate to a close on any legislation, it cannot pass," he added, explaining how 59 yay votes fails reach the 60-vote filibuster threshold. "We’ve now got more than enough to stop exactly the kind of legislation that Joe Biden wants."

Lee went on to say that two other Senate Republicans privately expressed support for the letter but declined to sign "for strategic reasons." Those senators "indicated that they will stand with us in the votes," he claimed, adding that there were "a couple of others who may yet decide to join us yet."

McCarthy was able to hold enough of the House Republican Conference together to pass his debt ceiling budget proposal, which is meant to serve as an opening salvo in negotiations with the White House, late last month. Biden, backed up by Senate Democrats, has stood firm in his refusal to negotiate over the debt limit.

The debt ceiling, or the top amount the federal government can borrow, will either need to be raised or abolished sometime this summer to avert a debt default. Economists have long warned that such a default would wreak havoc on the economy.

McCarthy's legislation pairs nearly $4.8 trillion in deficit reduction measures with a debt limit increase into the next year. The bill would return government agency funding to 2022 levels and cap annual increases at about 1% annually, except for the Pentagon. It would also roll back parts of Biden’s expansive health, climate, and tax laws, expand mining and fossil fuel production, and impose work requirements on social programs.

The White House has decried the bill as an attempt at political "hostage-taking" and vowed that Biden would veto it if it reached his desk, though the likelihood of such legislation passing the Senate, where Democrats control the chamber 51-49, is slim.

Asked if he was confident McConnell and other Senate Republicans would withstand fiscal pressures and hold firm, Lee responded affirmatively, saying, "Even if we lost one or two here or there, we’d still be fine, and I don’t think we’re going to the lose any of them.”

Yellen says using 14th Amendment to scrap debt limit would cause a 'constitutional crisis'

Ryan King

May 07, 11:14 AM May 07, 11:14 AM

Treasury Secretary Janet Yellen repeatedly declined to rule out the possibility of declaring the debt ceiling unconstitutional if Congress fails to resolve its standoff, but said doing so would be a "not-good" option.

Amid the brinkmanship, some have suggested that President Joe Biden could invoke the 14th Amendment to scrap the debt limit and avert a default. Yellen warned that such action would trigger a constitutional crisis and also stressed that Congress must act quickly to forestall an economic calamity.

REPUBLICANS WORRY THESE THREE CHANGES TO DEBT CEILING BILL WILL SINK FUTURE PLANS

"There is no way to protect our financial system in our economy other than Congress doing its job and raising the debt ceiling and enabling us to pay our bills. And we should not get to the point where we need to consider whether the president can go on issuing debt. This would be a constitutional crisis," Yellen said on ABC's This Week.

The 14th Amendment stipulates that the “validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.” However, the Constitution also grants Congress the power of the purse.

Yellen avoided a direct answer about whether such action was off the table.

"If Congress fails to meet its responsibility, there are simply no good options. And the ones that you've listed are among the not-good options," Yellen added.

Biden downplayed the potential use of the 14th Amendment during a recent MSNBC interview.

"I've not gotten there yet," he said.

Yellen also re-upped her well-worn warnings that if Congress fails to up the debt limit, "economic chaos would ensue" that would unleash havoc on both the domestic and global economy. She insisted that there are no more tricks in the department's reserve to buy additional time.

Biden is set to meet with congressional leaders, including House Speaker Kevin McCarthy (R-CA), on May 9. McCarthy and Biden last met back in February. The United States rammed up against its $31.4 trillion debt limit back in January, but the Treasury Department has deployed "extraordinary measures" to keep funds flowing in the time since.

Yellen recently estimated that those steps will run dry by June 1, giving Congress less than a month to resolve its differences. So far, neither side has shown signs of blinking, with Biden demanding a clean bill with no strings attached and McCarthy adamant that spending cuts be part of any deal.

Republicans worry these three changes to debt ceiling bill will sink future plans

Cami Mondeaux

May 06, 10:54 AM May 06, 10:54 AM

Some House Republicans are reportedly worried about a slew of last-minute changes that were made to Speaker Kevin McCarthy’s (R-CA) debt limit proposal, expressing concerns the Republican leader is harming chances of passing a compromise bill by making unrealistic promises to the most conservative members of his party.

In order to get his debt limit bill past the finish line, McCarthy made a number of concessions to far-right lawmakers in exchange for their support of the legislation. As a result, some members said they felt blindsided by the changes — especially after McCarthy and other GOP leaders promised no alterations would be made.

BIDEN REFRAINS FROM ATTACKS ON MCCARTHY AS DEBT CEILING FIGHT FAVORS GOP

The House narrowly passed McCarthy’s debt ceiling bill last month through a 217-215 vote, with just four Republicans voting against the measure. McCarthy secured the legislation by agreeing to a number of provisions, which has some GOP members concerned it could hurt their chances of moving other pieces of legislation forward in the future, according to Axios.

Here are some of the biggest changes McCarthy made to his debt ceiling and how they might pose challenges to the GOP later on:

Mace concessions: Gun control, cannabis, reproductive health

One of McCarthy’s staunchest holdouts was that of Rep. Nancy Mace (R-SC), who repeatedly vowed to vote against the legislation unless changes were made.

On the day of the vote, Mace held an afternoon meeting with McCarthy as the South Carolina Republican unveiled some of her top requests — many of them unrelated to the debt limit bill itself. In exchange for her support, McCarthy promised to move legislation forward on at least three fronts: gun control, cannabis, and reproductive health. (Or “weed, women, and guns,” as Mace put it.)

However, some members told the outlet they were irritated by that agreement as the legislation is unrelated to the provisions included in the debt limit bill.

Mace did have one request related to McCarthy’s bill, which included an amendment that would require a balanced budget. Similar measures were floated in initial budget proposals but were later dropped due to intraparty disagreements.

McCarthy folds to Iowa delegation

Despite vowing to move the legislation to the floor without any changes, McCarthy did make a number of other concessions the night before the vote in order to get some key GOP lawmakers on board.

Most notably, McCarthy agreed to make changes to one of his provisions that would repeal tax credits on clean fuels to address concerns from some Midwestern lawmakers, particularly from Iowa. After meeting with members of the Iowa delegation late Tuesday, McCarthy agreed to include exceptions to preserve those credits for those who entered into binding contracts between August 2022 and April 19.

Proposals to cut those ethanol tax credits threatened to sink McCarthy’s bill after at least eight Republicans from the “Corn Belt” said they’d vote against the bill unless changes were made. McCarthy’s decision appeared to pay off in the end as all four of Iowa’s representatives — Reps. Ashley Hinson, Zach Nunn, Mariannette Miller-Meeks, and Randy Feenstra — voted in favor of the legislation.

Work requirements for Medicaid benefits

Also included in McCarthy’s bill was a provision to implement work requirements for low-income individuals on Medicaid — a provision that has concerned some GOP members who fear blowback on the issue during the 2024 campaign cycle.

The legislation would limit how many food stamps able-bodied recipients ages 18 to 55 and without children can receive unless they work at least 20 hours a week. That mandate currently only applies to those ages 18 to 49, but those requirements were temporarily suspended during the COVID-19 pandemic.

Democrats have already taken aim at the proposal, especially after a report by the progressive Center on Budget and Policy Priorities predicted more than 10 million people, including millions of children, would be at risk of losing at least some of their food stamp benefits should the plan go through.

GOP leaders stand behind legislation

In the days and hours leading up to the vote, several Republican leaders defended the changes made to the bill, noting they were merely clarifications and that “nothing of substance” was changed.

Other rank-and-file members acknowledged the process looked messy but noted it was crucial to getting the legislation through the lower chamber.

"This looks messy, but just look at the results — we got it done,” one member familiar with the leadership’s thinking told Axios. “It's better to have more people having points of contact than less.”

Negotiations on the debt ceiling have long remained stalled inside the halls of Congress as both parties have refused to budge in order to come to a compromise. Now, government leaders are scrambling to avoid a default on the country’s loans after Treasury Secretary Janet Yellen issued a warning that Congress has just under a month until the United States will be unable to make payments if lawmakers don’t take action.

In response, Biden called the so-called “Big Four” — that is, McCarthy, Senate Minority Leader Mitch McConnell (R-KY), House Minority Leader Hakeem Jeffries (D-NY), and Senate Majority Leader Chuck Schumer (D-NY) — last week to schedule a meeting to discuss the debt ceiling, which is set to take place on Tuesday. All four leaders will be in attendance, marking the first time McCarthy and Biden have met to discuss the debt ceiling since Feb. 1.

Biden refrains from attacks on McCarthy as debt ceiling fight favors GOP

Cami Mondeaux

May 06, 08:48 AM May 06, 08:48 AM

In his first interview since announcing his reelection bid, President Joe Biden offered a change of tune over his relationship with House Speaker Kevin McCarthy (R-CA).

The president declined to criticize McCarthy's leadership ahead of a high-stakes meeting over the debt ceiling next week, instead calling McCarthy “an honest man.” Biden attempted to relieve McCarthy of blame by suggesting the Republican leader is being forced into tough positions by other members of his party.

MCCONNELL WILL ATTEND BIDEN MEETING ON DEBT CEILING BUT SAYS ‘SOLUTION IS NOT IN SENATE’

“I think he’s in the position, well, he had to make a deal,” Biden said. “There’s the Republican Party and there’s the MAGA Republicans, and the MAGA Republicans really have put him in a position where in order to stay speaker he has to agree — he’s agreed to things that, maybe he believes, but are just extreme.”

The comments come as the pair are scheduled to meet with the other three main congressional leaders on Tuesday to continue negotiations over the debt ceiling just weeks before the country is expected to default on its loans. It also marks a shift in attitude by Biden, who has often used the debt ceiling to criticize McCarthy’s leadership and undercut his leadership in the House.

As the two have sparred over the debt ceiling, Biden has repeatedly accused McCarthy of holding the economy “hostage” by tying the debt ceiling to his fiscal budget proposal, seeking to place the responsibility squarely on the speaker’s shoulders.

"In a speech to Wall Street, the speaker failed to guarantee he would be the first speaker not to default on our debt,” Biden said on April 29. “Let's be clear. If he fails, the American people will be devastated.”

Now it appears Biden is softening his stance as Republican leaders in the Senate are coalescing behind McCarthy — leaving the negotiations entirely between him and the White House.

“The message to the president is pretty clear: You got a choice between accepting the House bill or entering into a discussion, which the speaker’s been trying to have with the president for some time,” Senate Minority Leader Mitch McConnell (R-KY) said on Tuesday. “There is no solution in the Senate … The president and the speaker need to reach an agreement to get us past this impasse. That’s my message going down to the White House meeting.”

Negotiations on the debt ceiling have long remained stalled inside the halls of Congress as both parties have refused to budge in order to come to a compromise. Now, government leaders are scrambling to avoid a default on the country’s loans after Treasury Secretary Janet Yellen issued a warning that Congress has just under a month until the United States will be unable to make payments if lawmakers don’t take action.

House Republicans passed a bill last week that would raise the debt ceiling in exchange for cuts to government spending, but Senate Democrats have called those proposals “dead on arrival” in the upper chamber. Biden has also indicated he would not sign the legislation should it reach his desk.

Schumer did move ahead with placing two competing debt limit bills on the Senate calendar, including one that would suspend the debt limit through 2024 as well as the GOP-led debt limit package that already passed the House. It’s not yet clear whether either bill will come to the floor for a vote, and Schumer said a decision would come after leaders meet with Biden on Tuesday.

The meeting will mark the first time McCarthy and Biden have met to discuss the debt ceiling since Feb. 1.

White House refines its messaging war on debt ceiling ahead of McCarthy meeting

Naomi Lim

May 05, 06:46 PM May 05, 06:46 PM

The White House is tinkering with its criticism of Republicans before President Joe Biden sits down with Democratic congressional leaders, House Speaker Kevin McCarthy, and Senate Minority Leader Mitch McConnell to discuss the debt ceiling.

From warning of a "fire-alarm fire" and the country's risk of being perceived as a "deadbeat nation" to the debt ceiling fight being a "manufactured crisis," complementing claims Republicans will cut Meals on Wheels to law enforcement funding, the White House is still workshopping its response to the GOP as new polling reveals a public opinion split on who will be held responsible if there is a default.

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The White House does not have a message regarding the debt ceiling because they do not have a strategy for negotiating with Republicans, according to Dan Schnur, the communications director of the late Sen. John McCain's (R-AZ) 2000 presidential campaign and founder of the University of Southern California-Los Angeles Times state poll.

"They have misunderstood and under-estimated McCarthy every step of the way, and they still can’t decide if he’s an ally or an enemy," Schnur told the Washington Examiner.

The House has passed the Limit, Save, Grow Act, which would raise the debt ceiling by $1.5 trillion if non-defense discretionary federal spending is decreased to fiscal 2022 levels, budget increases are capped at 1% per year, and entitlement program work requirements are introduced, in addition to COVID-19 funding, Inflation Reduction Act green energy tax credit and IRS provisions, and Biden's student loan forgiveness proposal being repealed, per former Rep. Tim Huelskamp (R-KS).

"Now Joe Biden and the Senate Democrats are on the clock,” Huelskamp, a former House Tea Party Caucus chairman, and veteran of multiple debt ceiling squabbles, said. “Rather than attacking Republicans, it’s time for Biden and the rest of the Democrats to do their job and provide a solution that ends their out-of-control spending spree."

It is difficult for the public to know who to blame in the debt ceiling impasse after Biden scheduled talks with McCarthy and McConnell next Tuesday following months of declining to, Brookings Institution governance studies senior fellow Darrell West added.

Almost 40% of respondents to a Washington Post-ABC poll published Friday, for example, would blame congressional Republicans if there is a default and 36% Biden. Another 16% contend both the president and the GOP would be responsible if the country cannot pay its bills when the Treasury Department can no longer use cash on hand and so-called extraordinary measures this summer. Interestingly, almost 60% agree with Biden that the debt ceiling and spending cuts should be dealt with separately. Roughly a quarter side with Republicans in that the borrowing cap should only be raised in return for spending decreases.

"In a polarized world, people assume anyone on the other side is to blame so if Congress is unable to lift the ceiling, most people [will] side with their own group so there may not be a clear political winner," West said. "It will be easy to blame the other side for the intransigence that led to a government shutdown. The president [holds] big cards in a shutdown because he gets to decide what gets shutdown first."

"One popular tactic during summertime is to close the national parks knowing that the public will be outraged and will demand an end to the stalemate," TechTank's editor-in-chief went on. "Other popular bargaining chips could be Social Security payments, veterans benefits, and food programs because each has a ready-made constituency for its cause. The only safe prediction is political blame will be unpredictable and lots of people will end up being angry if Congress cannot resolve this issue."

Biden appeared to address the debt ceiling polling divide, repeating that he hoped to speak directly with the public during remarks to reporters before a Roosevelt Room meeting.

"This is becoming an issue in other countries. 'What is the United States going to do? Are they really fooling around with not paying the debt?'" he said. "So next week I'm going to reiterate to congressional leaders that they should do what every other Congress has done: that is pass the debt limit, avoid default. As I have said all along, we can debate where to cut, how much to spend, how to finally move the tax system where everybody has to pay their fair share or continue the route they're on, but not under the threat of default."

While Biden and Republicans may have publicly reiterated their positions, the White House is reportedly privately considering a short-term stopgap to the debt ceiling, a stance Office of Management and Budget director Shalanda Young confirmed during a briefing this week.

"Congressional leaders are going to have to figure out a way to do this," she said. "You saw the length in the congressional Republicans’ bill that would take us into this situation again, this time next year. So I'm sure one of the things on the table we will have to work through is how long. I'm not going to take anything off the table."

House GOP takes ax to Democratic clean energy credits with debt ceiling proposal

Jeremy Beaman

April 19, 04:32 PM April 19, 04:32 PM

House Republicans proposed new debt ceiling legislation Wednesday that would repeal nearly a dozen clean energy subsidies recently authorized by the Democratic Inflation Reduction Act as a way to reduce federal spending.

The GOP proposal would cut or shrink numerous of the tax credits that President Joe Biden and Democrats in Congress signed off on in August to expand renewable energy technologies, reduce greenhouse gas emissions, and accelerate their climate change agenda, including the new tax credit for consumer purchases of used electric vehicles.

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Other tax credits that would be repealed include the law's zero-emission nuclear power credit and the new tax $7,500 hundred tax credit for light-duty electric vehicles purchased for commercial use.

The debt ceiling bill also includes elements of HR 1, the House Republican sweeping energy proposal that would increase domestic production of fossil fuels and ease permitting for mining.

"The Limit, Save, Grow Act will limit federal spending, save taxpayers trillions of dollars, grow our economy, and lift the debt limit into next year," House Speaker Kevin McCarthy (R-CA) said. "This legislation will make us less dependent on the whims of the Chinese Communist Party and curb high inflation, all without touching Social Security or Medicare — because no one is hurt more by inflation than seniors."

Republicans have argued the Inflation Reduction Act's tax credits strengthen the advantage of China, which dominates various industries that produce batteries, solar products, and their upstream supply chains.

The law included language designed to bring those industries home or enable their expansion in trade partner countries, although some Democrats, most notably the chief author, Sen. Joe Manchin (D-WV), have complained that the administration is implementing the law too liberally to achieve those goals.

The White House is blasting Republicans' effort to repeal Biden's signature achievement, flipping the script to say their proposal would favor China.

"Let's be clear what MAGA attacks on the Inflation Reduction Act would mean for American families," press secretary Karine Jean-Pierre said Tuesday. "Offshore tens of thousands of manufacturing jobs, including in districts many of these members actually represent."

The legislation unveiled Wednesday is McCarthy's first offer in talks with Biden to raise the federal debt ceiling. The limit must be raised by some time this summer or early fall to prevent the Treasury from defaulting on the debt, a prospect the Treasury has said would create massive economic turmoil. Biden has said that he won't negotiate with Republicans over raising the debt limit and has challenged the House GOP to produce a budget resolution to show their plans for taxing and spending.

Bipartisan lawmakers draft ‘Plan B’ debt ceiling proposal as negotiations stall

Cami Mondeaux

April 19, 08:33 AM April 19, 08:33 AM

A bipartisan group of lawmakers drafted a debt ceiling proposal that would help the country avoid defaulting on its loans and would act as a backup plan if House Republicans and President Joe Biden can’t come to an agreement.

The plan created by centrist lawmakers in the Problem Solvers Caucus seeks to suspend the debt ceiling through the rest of the year while Congress proceeds with its usual budget and appropriations process, according to a confidential draft discussion obtained by Politico. The two-page memo does not go into detail on how the caucus would implement the plan, but it alludes to a framework that would take “a reasonable, responsible bipartisan approach.”

BIDEN AND MCCARTHY ENTER THE NEXT PHASE OF THEIR DEBT CEILING SHOWDOWN

As part of that plan, lawmakers would propose appointing an independent fiscal commission to “address ballooning debt and deficit and put the country on a sustainable path.” The group would be tasked with submitting its policy recommendations to Congress after the 2024 presidential election, which would then be teed up for a vote no later than February 2025.

“As every well-regarded expert, business leader, and economist can attest, defaulting would potentially send our currency and markets into a free fall,” the draft states. “Our nation is also on path to substantially increase our debt to GDP ratio from current alarming levels, which is unsustainable and fiscally dangerous.”

The backup plan comes as Republicans led by House Speaker Kevin McCarthy (R-CA) work to finalize a budget proposal by next week, hoping to restart negotiations with the White House on how to address the debt ceiling. Discussions have largely been stalled over the last two months as members of both parties attempt to use the financial crisis to achieve their priorities.

While Republicans seek to negotiate spending cuts in exchange for raising the debt ceiling, Democrats have remained adamant about passing a clean debt ceiling raise — putting lawmakers at an impasse just months before the looming deadline of a default.

McCarthy unveiled a proposal to GOP lawmakers on Tuesday that would raise the debt ceiling into 2024 while making cuts to government spending. The House speaker acknowledged the plan is not complete but will act as a catalyst to kick-start discussions with Biden.

The proposal, which McCarthy hopes to bring to the floor for a vote by next week, has received mixed reactions from GOP members. However, the speaker expressed confidence it can pass, urging members to back his plan.

McCarthy met with Biden in January to begin negotiations on the debt ceiling, but that meeting ended without a binding agreement as the White House maintains it will not discuss federal spending until the borrowing limit is lifted. McCarthy said on Monday he has not spoken with Biden since that initial meeting, accusing the president of “bumbling into the first default in our nation’s history.”

However, the White House declined to continue negotiations until Republicans release their budget proposal for the next fiscal year — a talking point that has been repeatedly used by Democrats in recent weeks.

“We will evaluate any legislative text when and if House Republicans can ever agree with themselves about how much they want to devastate American families,” House Minority Leader Hakeem Jeffries (D-NY) said.

It’s not clear whether the Problem Solvers Caucus plan would gain much traction in the House or come through for a vote. However, it is possible it will spark conversations about alternative plans to address the debt ceiling if an agreement can’t be reached.

Biden and McCarthy enter the next phase of their debt ceiling showdown

Naomi Lim

April 19, 05:27 AM April 19, 05:27 AM

More than 100 days into the 118th Congress and with only months before the country could default, President Joe Biden and House Speaker Kevin McCarthy (R-CA) are at loggerheads over the debt ceiling and federal budget.

But McCarthy's efforts to broker a debt ceiling deal among House Republicans could backfire with only a four-vote majority, jeopardizing negotiations with the White House, the stock market, millions of jobs, and the global financial system.

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House Republican Study Committee Chairman Kevin Hern (R-OK) is "encouraged" by McCarthy's outreach after the speaker spoke on the phone last weekend with his conference about the debt ceiling and then convened an in-person meeting Tuesday. The face-to-face was scheduled after McCarthy addressed Wall Street earlier this week.

"There seems to be a consensus among the conference on a number of issues, including bills we have already passed, that should be included in our debt limit legislation," Hern told the Washington Examiner. "There’s still hard work ahead of us, but I believe we can get 218 votes by the end of next week.”

Those bills include House Republicans' repeal of $80 billion in IRS funding, allocated through the Democrats-only Inflation Reduction Act, in addition to that measure's climate provisions — as well as the GOP-only Lower Energy Costs Act.

"A large bloc of members really want to see IRS & IRA included in the final bill," one source familiar said. "At conference this morning, there was wide support behind the inclusion of both IRA/IRS, and McCarthy seemed to be willing to have that discussion."

Rep. Chip Roy (R-TX) is one of those lawmakers, contending, "under no circumstances," should House Republicans "pass a long-term debt ceiling increase to mortgage our kids' future without getting substantive changes."

"We need to undo the Inflation Reduction Act, so-called, which has all these ridiculous green subsidies, which would destroy our ability to have economic growth and energy freedom," he told conservative radio host Glenn Beck. "We need to undo the damage of the IRS proposal, which will hang these bureaucrats going after the American people, who are trying to just go through their life."

McCarthy is seeking a vote on a debt ceiling deal before the House's next recess from April 28. The initial agreement, tentatively whipped by Reps. Tom Emmer (R-MN) and Guy Reschenthaler (R-PA), includes raising the debt ceiling for a year in exchange for capping nondefense discretionary spending at $584 billion next year, restricting budget increases to 1% annually for the next decade, redirecting unused COVID-19 aid, introducing social program work requirements, rescinding green tax credits, and rolling back student loan forgiveness schemes, among other ideas. But Biden has pressed McCarthy on where those cuts will come from.

During his New York Stock Exchange remarks, McCarthy was adamant "a no-strings-attached debt-limit increase will not pass," demanding Biden sit down with him to talk about the debt ceiling and budget.

"If there’s one thing I hope America has learned about me in these first 100 days since I was elected speaker, it’s this: I will never give up," he said Monday. "We owe it to the American people to use this moment in history to deliver the future they want, need, and deserve."

"Do you have the support of your party for what you’re actually proposing?” CNBC asked him afterward.

McCarthy replied, “You know what, I think I have the support of America because I’ll get the party behind it.”

Investors seemingly remain confident the White House and McCarthy will reach a deal and avoid a default. But House Republicans' response to Tuesday's meeting demonstrates the precariousness of the moment, with the conference not close to a debt ceiling raising agreement, let alone a budget, which is Biden's precondition for a conversation about spending. Simultaneously, McCarthy is grappling with reports he does not trust House Majority Leader Steve Scalise (R-LA) and Budget Committee Chairman Jodey Arrington (R-TX).

The White House has criticized McCarthy's speech and his approach to the debt ceiling and budget more broadly, though at least one poll indicates the speaker may be better positioned than Biden in their competing public relations campaigns. More than 50% of respondents in McCarthy-aligned American Action Network's battleground poll this month believe the speaker is negotiating with Biden in good faith, compared to 36% who think he is not. Roughly the same percentage are against raising the debt ceiling without cutting spending, in contrast to 37% who are for it.

"Yesterday, the speaker of the House, Kevin McCarthy, went to Wall Street," Biden said Tuesday during what was billed as a "care economy" event at the White House. "He did not tell the wealthy or the powerful on Wall Street it was finally time for them to start paying their fair share in taxes. That didn't come up, other than saying they're going to renew the $2 trillion tax cut."

White House spokesman Andrew Bates specifically ripped McCarthy for permitting "ultra-MAGA hardliners" to dominate the House Republican conference, repeating how the GOP raised the debt ceiling three times for former President Donald Trump.

"Now, the increasingly empowered extreme MAGA Republicans want their ransom to be killing tens of thousands of manufacturing jobs in a windfall for China, raising prescription drug and energy costs for middle-class families, and sending the deficit skyward — all in the name of sweetheart deals for rich special interests," he said.

Schumer: ‘If Speaker McCarthy doesn’t change course, we’re are headed for default'

Samantha-Jo Roth

April 17, 03:28 PM April 17, 03:28 PM

Senate Majority Leader Chuck Schumer (D-NY) warned the United States is “headed for default” in response to House Speaker Kevin McCarthy's (R-CA) debt limit speech at the New York Stock Exchange, calling the speech “theater” during a press conference on Monday.

“What we got today is not a plan. It’s a recycled pile of the same things he has been saying for months,” Schumer said to reporters during a press conference.

MCCARTHY MAKES CASE FOR PAIRING SPENDING CUTS WITH DEBT CEILING FIX IN NYSE ADDRESS

McCarthy outlined a proposal to lift the nation’s credit limit for one year in exchange for significant spending cuts and policy changes to federal assistance programs on Monday. He said House Republicans could vote “in the coming weeks.” Republicans have yet to offer a budget plan that would set out specifics of where the spending cuts would fall, which President Joe Biden and Schumer have repeatedly called on them to do. Schumer rejected one of the specific details McCarthy mentioned on Monday.

“Amazingly, one of the few specifics McCarthy presented is this terrible idea to kick the can down the road for just one year and undergo the same crisis again,” Schumer said. “Why would anyone want to undergo this crisis again and again and again and again?”

DEMOCRATS IN WHITE HOUSE AND CONGRESS UNMOVED BY MCCARTHY'S DEBT CEILING SPEECH

Schumer called on the House speaker to “show us your plan,” a rallying cry he’s been using since early January. McCarthy’s speech comes as Republicans have yet to agree on a fiscal blueprint for the budget. It’s unclear whether the proposal outlined by McCarthy on Monday could pass in the lower chamber with a slim majority. His proposal appeared to be significantly narrower than demands from some in the party that included balancing the budget in 10 years.

Negotiations have been at a stalemate as both sides attempt to leverage the debt ceiling crisis to advance their own positions. Democrats remain firm in their stance that House Republicans should raise the nation’s borrowing limit with no conditions. House Republicans continue to reject that position and assert they won’t pass a debt ceiling increase unless they have an agreement with the White House on budget cuts.

The speaker sent a letter to Biden on March 28 urging him to restart negotiations, accusing him of putting the economy “in jeopardy” by refusing to negotiate. Biden and Democrats have repeatedly said a second meeting could not occur until Republicans release their proposed budget for the next fiscal year. Biden responded that day, telling McCarthy that House Republicans must first release their proposed budget ahead of a meeting.

The Treasury Department warned on Jan. 19 it was using extraordinary measures to prevent a government default. It's unclear on what date the U.S. will default, but it will likely happen in the summer if lawmakers don't come to an agreement. The Senate majority leader said he had not received any new updates from Treasury Secretary Janet Yellen on when a default could occur.

White House invokes Trump and Reagan to attack McCarthy's debt 'brinkmanship'

Christian Datoc

April 17, 09:27 AM April 17, 09:27 AM

The Biden White House launched a new line of debt limit attacks against House Republicans ahead of House Speaker Kevin McCarthy's (R-CA) Monday speech in New York.

McCarthy is slated to lay out the GOP's budget proposals amid an escalating standoff with President Joe Biden over the debt limit.

MCCARTHY'S PAST WINS DON'T MATTER IF HE CAN'T DELIVER ON DEBT

McCarthy and Republicans are refusing to address the debt ceiling without extracting spending concessions from Democrats but have failed to propose specific cuts, which White House officials say is already threatening the "reliability and credibility" of U.S. credit months ahead of this summer's deadline.

"There is one responsible solution to the debt limit: addressing it promptly, without brinksmanship or hostage taking — as Republicans did three times in the last administration and as Presidents Trump and Reagan argued for in office," White House deputy press secretary Andrew Bates said in a statement Monday morning. "Speaker McCarthy is holding the full faith and credit of the United States hostage, threatening our economy and hardworking Americans’ retirement."

Bates claimed McCarthy's speech "isn’t a plan, but it’s clear that extreme MAGA Republicans’ wish lists will impose devastating cuts on hardworking families, send manufacturing overseas, take healthcare and food assistance away from millions of people, and increase energy costs — all while adding trillions to the debt with tax cuts skewed to the super-wealthy and corporations."

The White House has pointed to how Democrats worked with Republicans to raise the debt limit in the previous administration but additionally quoted former Presidents Donald Trump and Ronald Reagan cautioning against debt ceiling "brinkmanship."

Bates pointed to remarks Trump gave in 2019 about working with then-Senate Minority Leader Chuck Schumer (D-NY) and former House Speaker Nancy Pelosi (D-CA) to avoid a debt showdown.

"I can’t imagine anybody ever even thinking of using the debt ceiling as a negotiating wedge," Trump remarked at the time. "[I said to] Sen. Schumer and to Nancy Pelosi, ‘Would anybody ever use that to negotiate with?’ They said, ‘Absolutely not.’ That’s a sacred element of our country.”

Reagan, in a 1987 radio address, similarly claimed that debt "brinkmanship threatens the holders of government bonds and those who rely on Social Security and veterans benefits."

"The United States has a special responsibility to itself and the world to meet its obligations. It means we have a well-earned reputation for reliability and credibility — two things that set us apart from much of the world.”

Lawmakers return to Washington with no debt ceiling deal in sight

David Sivak

April 17, 05:25 AM April 17, 05:25 AM

It’s been three months since Kevin McCarthy (R-CA), freshly elected as speaker of the House, called on Joe Biden to negotiate spending cuts in exchange for hiking the debt limit.

Yet as Congress returns from a two-week recess on Monday, House Republicans are no closer to resolving what has become a protracted fight with the president.

‘OUR JOB IS OVERSIGHT': CONGRESS TO PROBE DAMAGING LEAK OF CLASSIFIED PENTAGON DOCUMENTS

Lawmakers fly back to Washington on Monday to consider a series of measures being voted on this week, including an effort to roll back police reforms enacted by the D.C. Council and legislation banning transgender athletes from competing in girls sports.

But looming in the background is a more daunting task for House Republicans: coalescing behind an opening offer in debt ceiling negotiations with the White House.

McCarthy's pledge to push for deep spending cuts, made to hard-liners in his conference to win the speaker's gavel, put him on a collision course with Biden, who is adamantly refusing to make concessions. McCarthy is slated to give a major speech on the debt limit at the New York Stock Exchange on Monday morning, a move reminiscent of President Ronald Reagan's own speech there 37 years ago.

The impasse threatens to send the United States into default as it approaches an unknown “X date” to lift the debt limit. The Treasury Department, which is using “extraordinary measures” to pay its federal obligations since hitting the government’s $31.4 trillion cap in January, has estimated it could run out of money as soon as June, though a late summer deadline is more likely.

That means Washington will have to agree to a deal before lawmakers depart for the monthlong recess in August.

Biden and McCarthy met at the White House for an initial meeting in February, even as the president reiterated his demand for a clean debt ceiling hike, and the pair put on a show of bipartisanship at a St. Patrick's Day luncheon six weeks later.

But no progress has been made between the two leaders with just months left to act.

McCarthy pressed for a second meeting shortly before the Easter recess, penning a letter in which he blamed Biden for not scheduling another sit-down. The move prompted the president to return the finger-pointing with a common refrain among Democrats: “Show us your budget.”

Biden argues negotiations won't be productive without McCarthy putting forward a budget that details the cuts Republicans want to make and refuses to sit down with him until then. The president says the ball is in Republicans' court after the White House released its own 2024 budget blueprint in March.

McCarthy outlined some of the possible demands in his March 28 letter, but the president quickly demanded a “full set of proposals.”

The posturing from the White House suggests the president views himself as having the upper hand in the stalemate. Republicans are historically blamed for government shutdown fights, and there’s no reason to expect the debt ceiling standoff is any different.

But more importantly, it’s not clear McCarthy has the votes needed to pass the spending cuts he’s demanding with only a four-seat majority in the lower chamber. He has to bridge the demands of hard-line members of the Freedom Caucus with the reservations of centrist Republicans up for reelection in swing districts.

Democrats are already messaging that Republicans want to slash popular programs and hurt the poor, and centrists may balk at taking a politically tough vote.

The sheer difficulty of getting the fractious Republican conference to agree on a set of demands is the greatest test yet for McCarthy’s speakership, one that has led to simmering tensions within House GOP leadership.

McCarthy has reportedly disparaged his top deputies in private, prompting blowback from lawmakers who say the speaker is trying to find a scapegoat in case their fight backfires.

But there are signs Republicans could rally around a set of demands. The Main Street Caucus, which represents a group of 70 “pragmatic” Republicans, outlined on Thursday a list of concessions it believes could get 218 votes.

The list includes clawing back some $70 billion in COVID-19 relief funds that states have not spent, reversing Biden’s student loan forgiveness program, and capping discretionary nondefense spending at 2022 levels.

The outline, sent to McCarthy in a letter on Thursday, also showed an appetite for energy permitting reform as part of a deal and called for work requirements for food stamps beneficiaries.

The demands are similar, if less expansive, than those put forward by the ultraconservative House Freedom Caucus in March. Any deal would need buy-in from its 30-some members, who were able to force the concessions during McCarthy’s speakership election in the first place.

But they show some areas of consensus as House leadership tries to unite the “five families” of the GOP conference.

House Republicans are drafting legislation that includes a set of demands with the widest support, according to Politico, and hope to pass the measure by the end of May.

The legislation would amount to the GOP’s first formal offer in talks with the White House and, if passed, would signal the GOP is serious about forcing cuts.

Thus far, Senate Republicans, who lack a majority in the upper chamber, are letting the House GOP take the lead on negotiations.

Calm before the storm? McCarthy's majority holds together after 100 days

W. James Antle III

April 13, 06:00 AM April 13, 06:00 AM

House Speaker Kevin McCarthy's (R-CA) 15 ballots to secure his job seem like a distant memory 100 days into the Republican majority, but his biggest challenges lie ahead.

Republicans have managed to pass a few bills that divide Democrats. Some of these measures have made it through the Senate, where Republicans not only lack a majority but actually lost a seat last year. President Joe Biden has even felt the need to sign some of them into law, though he has also issued the first two vetoes of his presidency during this time period.

But so much is still riding on whether McCarthy can make it through a debt ceiling showdown with Biden while neither capitulating on spending nor sending the country into default. His speakership may depend on his success.

MCCARTHY'S MOMENTUM

One thing McCarthy has succeeded in doing in helping his party overcome long odds — Republicans do not control the White House or the Senate — is identifying legislation that cannot be filibustered or kept off the legislative calendar by Majority Leader Chuck Schumer (D-NY). The Congressional Review Act, which allows Congress to repeal regulations published in the last 60 days, is one way to do that. Resolutions of disapproval of Washington, D.C., laws are another.

The other was finding issues that divide Democrats. There is a generational and ideological split within the Democratic Party over crime. Biden is trying to push Democrats away from defunding the police while big-city mayors and councilors, such as those found in 2024 DNC convention host city Chicago, position themselves well to the president’s left.

The vote on overturning a crime bill passed by the liberal council of the District of Columbia was instructive. Washington, D.C., is suffering a crime wave, like many large, Democratic-governed urban areas. The issue limited Democratic gains in the 2020 elections and remained a liability in the midterm elections. Democrats on the D.C. Council responded by relaxing penalties for serious crimes ranging from carjackings to homicides over the mayor’s objections.

Biden and the Democrats support D.C. statehood. Short of being able to deliver that, they would like to be seen as strongly supportive of home rule. But D.C.’s three electoral votes are assured next year. The votes of suburbanites worried about urban lawlessness intruding into their neighborhoods remain vigorously contested and may prove unavailable to Democrats seen as soft on crime.

The White House issued a statement of policy saying that it opposed a Republican attempt to overturn this law, as Congress has the constitutional authority to do in the federal district. But more sober minds in the West Wing eventually won out, considering the pitfalls of defending this crime policy. Biden relented.

“I support D.C. Statehood and home-rule — but I don’t support some of the changes D.C. Council put forward over the Mayor’s objections — such as lowering penalties for carjackings,” Biden said in a Twitter statement shortly after informing Senate Democrats in a closed-door meeting of his new position. “If the Senate votes to overturn what D.C. Council did — I’ll sign it.” House Democrats weren't tipped off accordingly.

Democrats were taken aback by Biden’s shift. Liberal activists and commentators condemned it as a sellout designed to win swing voters in 2024.

On declassifying intelligence on COVID-19 origins, Democrats did not mount even token opposition to legislation McCarthy moved to force Biden’s hand. The House passed it 419-0. It then cleared the Senate by unanimous consent.

McCarthy’s other COVID-19 victory came on lifting the national emergency. As was the case with crime in D.C., most House Democrats tried to hold the liberal line, assuming Biden was with them. Instead, the White House abandoned them.

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A loss in the debt ceiling fight, either through the failure to extend before the bills come due or the inability to deliver on any spending cuts, will obviate most of these successes. Democrats are hopeful recent history means they can prevail in this conflict.

McCarthy and his young House Republican majority are still entering in a better position than seemed likely after November's results or January's infighting.

Manchin criticizes Biden for placing 'ideological agenda' over debt ceiling negotiations

Cami Mondeaux

March 30, 09:13 AM March 30, 09:16 AM

Sen. Joe Manchin (D-WV) hit out against President Joe Biden on Wednesday, accusing the president of pushing his “ideological agenda” rather than meeting with members of Congress to address inflation and the looming debt ceiling crisis.

In an op-ed published by the Wall Street Journal, Manchin criticized Biden over his administration’s implementation of the Inflation Reduction Act, a landmark bill the West Virginia Democrat helped construe to reduce the country’s deficit and promote energy security. However, Manchin accused Biden administration officials of abusing the Inflation Reduction Act to increase spending levels unilaterally, calling the act a “betrayal.”

MANCHIN THREATENS TO SUE TREASURY OVER ELECTRIC VEHICLE TAX CREDITS

“While all parties have a responsibility to negotiate in good faith, recent actions make clear to me that the Biden administration is determined to pursue an ideological agenda rather than confront the clear and present danger that debts and deficits pose to our nation,” Manchin wrote. “Instead of implementing the law as intended, unelected ideologues, bureaucrats and appointees seem determined to violate and subvert the law to advance a partisan agenda that ignores both energy and fiscal security.”

Manchin specifically accused the Biden administration of ignoring stipulations in the Inflation Reduction Act to expand fossil fuel energy by redefining “domestic energy” to align with its own clean energy initiatives.

“The administration is attempting at every turn to implement the bill it wanted, not the bill Congress actually passed,” he wrote. “Ignoring the debt and deficit implications of these actions as the time nears to raise the debt ceiling isn’t only wrong, it’s policy and political malpractice.”

The West Virginia senator urged Biden to reverse those actions, offering a two-step plan to rein in the so-called “extremism.”

First, Manchin called on Biden to meet with “fiscally minded” Republicans and Democrats to negotiate a solution to the debt ceiling crisis, urging the president to end his stalemate with House Speaker Kevin McCarthy (R-CA) to come to an agreement. Biden and McCarthy initially met in January to discuss the debt ceiling, but the pair have not met since — with Biden maintaining he would not negotiate further until Republicans release their budget for the next fiscal year.

Manchin criticized Biden for his refusal to meet, urging the president to find areas in his own budget proposal to negotiate.

“While we can all acknowledge that raising the debt limit is an absolute necessity and Republicans shouldn’t threaten otherwise, are we seriously to believe there is no room to negotiate?” Manchin wrote. “Does the federal government operate so efficiently and effectively that there truly isn’t a dollar of waste, fraud or abuse? Let’s get serious.”

Manchin also pressed Biden to instruct his administration officials to implement the Inflation Reduction Act “as written” rather than interpreting its provisions to advance their own agenda.

“The president has the power, today, to direct his administration to follow the law, as well as to sit down with congressional leaders and negotiate meaningful, serious reforms to the federal budget,” Manchin wrote. “Failing to do so may score political points with left-wing partisans, but generations of Americans will ultimately pay the price.”

Biden responded to Manchin’s criticisms on Thursday morning, noting the president and senator share a “strong and productive relationship.” However, Biden did not indicate whether he would call for a meeting with congressional leaders.

"We are proud of the Inflation Reduction Act and our shared goals it achieves — promoting America’s energy security, strengthening supply chains, creating good-paying manufacturing jobs, and investing in energy communities and towns across America that have been left behind,” the White House said in a statement.

Congressional conservatives gird for battle with Biden over debt ceiling and spending

Samantha-Jo Roth

March 22, 05:42 PM March 22, 05:42 PM

House Freedom Caucus members and "Breakfast Club" senators held a rare joint news conference, chomping at the bit to start budget and debt limit work with President Joe Biden, with the deadline to raise the nation’s borrowing limit looming.

"We're ready to go right now," Rep. Scott Perry (R-PA), the House Freedom Caucus chairman, said during the press conference. "If the president wants to solve this, we're all here."

FREEDOM CAUCUS REVEALS LIST OF DEMANDS IN DEBT CEILING FIGHT AFTER BIDEN BUDGET RELEASED

The group recently released a blueprint for budget cuts as a condition for a vote to raise the debt limit. The exhaustive list of demands includes measures that would cut current spending and place a cap on future spending. It would also rescind unspent COVID-19 funds, end student loan bailout programs, and repeal increased funding for the Internal Revenue Service that was part of President Joe Biden’s Inflation Reduction Act.

“All we are saying is, 'Hey, let’s check under the couch cushions, maybe. Let’s see if we can find some money hanging around somewhere that doesn’t need to be spent on some wants and put it toward some actual needs of the federal government,'” said Rep. Michael Cloud (R-TX).

The White House called the House Freedom Caucus’s budget proposal a "five-alarm fire," arguing that its spending cuts would endanger the safety of the public. The Biden administration claims the proposal endangers public safety, raises costs for families, weakens national security, and hurts seniors. Democrats are also utilizing Congressional Budget Office analysis to argue that the Republican push for a balanced budget would impose devastating cuts to important federal programs.

WHITE HOUSE LAUNCHES MEDIA BLITZ AGAINST FREEDOM CAUCUS 'FIVE-ALARM' BUDGET PROPOSAL

“To the press secretary over at the White House, who said our plan is to create a five-alarm fire, you’re lying,” said Rep. Byron Donalds (R-FL). “I wish he would just take an economics course because spending money the way Joe Biden wants to, that is the five-alarm fire.”

A House budget resolution is expected to be delayed in order to allow for negotiations between Biden and House Speaker Kevin McCarthy (R-CA) on a debt limit increase in exchange for spending cuts, according to Roll Call. Biden continues to say he won’t negotiate conditions to raise the debt limit.

McCarthy and Biden met initially in February and agreed to keep the lines of communication open, but no further meetings have been scheduled. "Show us your plan" has become a rallying cry from Senate Majority Leader Chuck Schumer (D-NY) as he and other Democrats raise the specter of cuts to food stamps, Medicaid, and other federal programs. Schumer has even goaded Republicans by questioning whether the GOP wants to cut funding to veterans and first responders.

Lawmakers still have a couple months to work out a deal. The Congressional Budget Office estimates they have between June and September to find a resolution before the nation defaults on its bills.

“We need to stop getting into a position where they can hold us up to force us to pass an omnibus, or say they’re going to shut down everything. That’s wrong,” said Sen. Rick Scott (R-FL). “What the Freedom Caucus proposed is to stop this whole process where they hold this up and then get more and more spending.”

The looming debate will likely be one of McCarthy’s most difficult challenges as speaker as he attempts to negotiate with Biden without upsetting his right flank. After the chaos of the speaker’s election, members of the caucus are standing firm on their demands, firing a warning shot at the Biden administration.

“I’d like to remind Mr. Biden that America saw what the House Freedom Caucus is made of in January,” said Rep. Lauren Boebert (R-CO). “Lies don’t move us. Media coverage doesn’t move us. Attack ads don’t move us. Policy moves us.”

As the deadline draws closer, Senate Republicans are making it clear a plan to raise the debt ceiling must originate in the House, leaving negotiations to McCarthy.

“What Senate Republicans are doing, we’re supporting our counterparts in the House of Representatives and leadership and their efforts to negotiate a deal with the White House. I can’t speak to the current progress of that,” said Sen. John Thune (R-SD), the No. 2 Republican in the Senate during a press conference on Wednesday. “Sometimes, all it takes is a little bit of pressure in order to get people to the table.”