President Joe Biden and top Republican lawmakers will declare their positions face to face on raising the $31.4 trillion U.S. debt ceiling on Tuesday, with the looming prospect of an unprecedented default in three weeks if Congress does not act.
Ahead of the 4 p.m. ET Oval Office session, there were no signs that either side would immediately agree to any concessions to head off a default as early as June 1.
Economists warn that a lengthy default could send the U.S. economy into a deep recession with soaring unemployment while destabilizing a global financial system that’s built on U.S. bonds. Investors are bracing for impact.
Tuesday’s meeting was likely to be the start of an increasingly fraught period.
McCarthy, whose party holds only a slim majority in the House, wants to tie a vote on the debt ceiling to broad spending cuts the White House considers draconian.
On Tuesday, McCarthy appeared to close the door to one short-term solution, saying he opposed a deal that would lift the debt ceiling through September to allow more time for an agreement with Democrats on spending.
“No,” McCarthy said when asked by reporters if he would agree to align the debt ceiling with the budget process should Biden propose such an idea.
Biden would agree to a separate discussion on the budget but not tied to the debt ceiling, the White House said.
His meeting with McCarthy will be their first since Feb. 1. They will be joined by Senate Majority Leader Chuck Schumer, a Democrat, as well as top Senate Republican Mitch McConnell and top House Democrat Hakeem Jeffries.