debt ceiling – Cincy Link https://cincylink.com Explore Cincy Sat, 03 Jun 2023 12:36:38 +0000 en-US hourly 1 https://wordpress.org/?v=6.7.1 https://cincylink.com/pub/content/uploads/sites/27/2020/03/apple-touch-icon-precomposed-100x100.png debt ceiling – Cincy Link https://cincylink.com 32 32 Biden expected to sign budget deal to raise debt ceiling https://cincylink.com/2023/06/03/biden-expected-to-sign-budget-deal-to-raise-debt-ceiling/ https://cincylink.com/2023/06/03/biden-expected-to-sign-budget-deal-to-raise-debt-ceiling/#respond Sat, 03 Jun 2023 12:36:38 +0000 https://cincylink.com/?p=201495


By CHRIS MEGERIAN Associated Press

Biden expected to sign budget deal to raise debt ceiling



My fellow Americans when I ran for president, I was told the days of bipartisanship are over and the Democrats and Republicans can no longer work together. But I refuse to believe that because America can never give into that way of thinking. Look, the only way American democracy can function is through compromise and consensus. And that's what I work to do as your president, you know, to forge bipartisan agreement where it's possible and where it's needed. I've signed more than 350 bipartisan laws thus far, almost 2.5 years including the historic law that rebuilding America so that we can rank number one in the world in infrastructure instead of where we're ranked now number 13 in the world, another historic law, rebuilding our manufacturing base. So that will lead the world once again in making semiconductor chips so much more and so so many more and so many more sophisticated ones. And now *** bipartisan budget agreement, this is vital because because it's essential to the progress we made over the last few years is keeping full faith and credit of the United States of America and passing *** budget that continues to grow our economy and reflects our values as *** nation. That's why I'm speaking tonight to report on the crisis of verdict and what we're doing to protect America's future. Passing this budget agreement was critical. The stakes could not have been higher if we had failed to reach an agreement on the budget. There were extreme voices threatening to take America for the first time in our 247 year history and to default on our national debt, nothing, nothing would have been more irresponsible. Nothing would have been more catastrophic. Our economy would have been thrown in *** recession. Retirement accounts from millions of Americans would have been decimated. Eight million Americans would have lost their jobs. Default would have been have have destroyed our nation's credit rating which would have made everything from mortgages to car loans, to funding for the government much more expensive. And it would have taken years to climb out of that hole and America standing as the most trusted, reliable financial partner in the world would have been shattered. So it was critical to reach an agreement and it's very good news for the American people. No one got everything they want but the American people got what they needed. We averted an economic crisis, an economic collapse. We're cutting spending and bringing the deficits down. At the same time, we're protecting important priorities from Social security to Medicare, to Medicaid, to veterans, to our transformational investments in infrastructure and clean energy. I want to commend Senator Speaker mccarthy, you know, uh he and I uh we and our teams, we were able to get along, get things done. We were straightforward with one another, completely honest with one another, respectful with one another. Both sides operated in good faith. Both sides kept their word. And I also want to commend other congressional leaders. House minority leader Jeffries, Senate, majority leader Schumer Senate, minority leader mcconnell, they acted responsibly and put the good of the country ahead of politics. The final vote in both chambers was overwhelming. Far more bipartisan than anyone thought was possible. So I want to thank the members of Congress who voted to pass this agreement, which I'm gonna sign tomorrow and become the law. So here's what the deal does. First, it cuts spending and over the next 10 years, the deficit will be cut by more than $1 trillion and I'll be on top of the record 1.7 trillion $1.7 trillion. I already cut the deficit in my first two years in office and it's clear we're all in *** much more fiscally responsible course than the one I inherited when I took office. Four years ago, when I came to office, the deficit had increased every year, the previous four years and nearly $8 trillion were added to the national debt in the last administration. And now we're turning things around and that's good for America. You know, my dad used to have an expression. He said, Joey, don't tell me what you value, show me your budget. I'll tell you what you value. That's at the heart of this debate. What do we value protecting seniors? You may remember during my State of the Union address, there was, there was *** spirit exchange between me and *** few Republicans spontaneously occurring on the floor of the House of Representatives. I was pointing out that for years, some of them were putting forward proposals to cut Social Security Medicare and some of them that night took exception and they said very loudly that that wasn't true. So I asked them on the floor at that night, I said, ask them *** simple question. Will you agree not to cut social security not to cut Medicare? Would they agree to protect these essential programs? *** lifeline for millions of Americans programs that these Americans have been paying and into every single paycheck they've earned since they started working and it provides so much peace of mind with the bright lights and cameras on those few Republicans who were protesting, they agreed, they said they wouldn't cut it. That's how we protected Social Security Medicare from the beginning and from *** being cut period, health care was another priority for me. *** top priority. I made it clear from the outset, I would not agree to any cuts in Medicaid, another essential lifeline for millions of Americans, including Children in poverty, the elderly, in nursing homes and Americans living with disabilities. The original House Republican proposal would have cut health care for up to 21 million Americans on Medicaid. And I said no, and Medicare is protected and so are millions of people most in need. Look, I've long believed that the only one truly sacred obligation that the government has is to pair those we send into harm's way and care for them and their families when they come home and when they don't come home, that's why my last budget provided va hospitals with additional funding for more doctors, nurses and equipment to accommodate the needs of veterans and more appointments. The House Republican plan would have met 30 fewer million va health care visits for our veterans. We didn't let that happen. In addition, this bill fully funds the bipartisan Pact Act. The most significant law in decades for veterans exposed to toxic burn pits and for their families expands access to those veterans and their families, to health care and to disability benefits. Look, we're investing in America in our people and in our future, we've created over 13 million new jobs. Nearly 800,000 manufacturing jobs. Where is it? Written? And America can't lead the world again. In manufacturing, unemployment is at 3.7% more Americans are working today than ever in the history of this country. And inflation has dropped 10 straight months in *** row. In this debate, I refused to put what was responsible for all this economic progress on the chopping block. This bipartisan agreement protects the law that will help us build the best infrastructure in the world, fully protects the Chips and Science Act, which is gonna bring key parts of our supply chain to America. So we don't have to rely on others like semiconductors, those tiny computer chips smaller than the tip of your finger that affect nearly everything we rely on from cell phones to have building automobiles to the most sophisticated weapon systems. And so much more, we protected another law that I passed and signed last year that finally beat Big Pharma, which I've been trying to do for over 30 years. It finally gives Medicare the power to negotiate lower drug prices just like the VA has been able to do for veterans. This law has already dramatically cut the cost of insulin for seniors from as much as $400 *** month to just $35 *** month for insulin negotiating lower drug prices, not only saves seniors *** lot of money, it saves the country, *** lot of money, 100 and $60 billion. That's not having to be paid out because we're drug prices are more rational. We pay the highest drug prices of any industrial nation in the world. And it's just the beginning, you know, we also protected the most significant breakthrough ever ever in dealing with the existential threat of climate change. Today, new wind and solar power is cheaper than fossil fuel since I've been in office, clean energy and advanced manufacturing have brought in $470 billion in private investment that's going to create thousands of jobs, good paying jobs all across this country and help the environment. At the same time. Remember at the beginning of this debate, some of our Republican colleagues were determined to gut the clean energy investments. I said, no, we kept them all and there's more and there's so much more to do. We're going to do even more to reduce the deficit. We need to control spending if we're going to do that. But we also have to raise revenue and go after tax sheets and make sure everybody is paying their fair share. No one, I promise no one making more, less than $400,000 *** year will pay *** penny more in federal taxes. But like most of you at home, I know the federal tax system isn't fair. That's why I kept my commitment again that no one earning less than $400,000 *** year will pay *** penny more in federal taxes. That's why last year I secured more funding to go more IRS funding to go after wealthy tax cheats the nonpartisan congressional budget office and it is nonpartisan says that this bill will bring in 100 and $50 billion and other outside experts expect that it would save as much as $400 billion because it's forcing people to pay their fair share. Republicans may not like it, but I'm gonna make sure the wealthy pay their fair share. I'm also proposed closing over *** dozen special interest tax loopholes for big oil crypto traders, hedge fund billionaires saving taxpayers billions of dollars. Republi Republicans defended every single one of these special interest loopholes, every single one. But I'm going to be coming back and with your help, I'm gonna win right now. Catch this right now. The average billionaire in America pays just 8% in federal taxes. 8% teachers and firefighters pay more than that. That's why I proposed *** minimum tax for billionaires. Republicans are against it, but I'm gonna keep fighting for it. No billionaire should pay less in federal taxes than the teacher or firefighter. Look, let me close with this. I know bipartisanship is hard and unity is hard, but we can never stop trying because in moments like this one, the ones we just faced where the American economy and the world economy is at risk of collapsing. There's no other way, no matter how tough our politics gets, we need to see each other as not as adversaries, but as fellow Americans treat each other with dignity and respect to join forces as Americans to stop shouting lower the temperature and work together to pursue progress, secure prosperity and keep the promise of America for everybody. As I've said, my inaugural address without unity, there is no peace, only bitterness and, and fury and we can never become that country. I can honestly say, I can honestly say to you tonight that I've never been more optimistic about America's future. We just need to remember who we are. We are the United States of America and there's nothing, nothing we can't do when we do it together. Well, thank you all for listening, taking the time tonight to listen to me. May God bless you all and may God protect our troops. Thank you.

President Joe Biden is expected to sign legislation on Saturday to raise the debt ceiling, just two days before the U.S. Treasury warned that the country would struggle to pay its bills.The bipartisan measure, which was approved this week by the House and Senate, eliminates the potential for an unprecedented government default.“Passing this budget agreement was critical. The stakes could not have been higher," Biden said from the Oval Office on Friday evening. “Nothing would have been more catastrophic,” he said, than defaulting on the country's debt.The agreement was hashed out by Biden and House Speaker Kevin McCarthy, giving Republicans some of their demanded federal spending cuts but holding the line on major Democratic priorities. It raises the debt limit until 2025 — after the 2024 presidential election — and gives legislators budget targets for the next two years in hopes of assuring fiscal stability as the political season heats up.“No one got everything they wanted but the American people got what they needed,” Biden said, highlighting the “compromise and consensus” in the deal. “We averted an economic crisis and an economic collapse.”Video below: A closer look at the debt ceiling billBiden used the opportunity to itemize the achievements of his first term as he runs for reelection, including support for high-tech manufacturing, infrastructure investments and financial incentives for fighting climate change. He also highlighted ways he blunted Republican efforts to roll back his agenda and achieve deeper cuts.“We’re cutting spending and bringing deficits down at the same time,” Biden said. “We're protecting important priorities from Social Security to Medicare to Medicaid to veterans to our transformational investments in infrastructure and clean energy.”Even as he pledged to continue working with Republicans, Biden also drew contrasts with the opposing party, particularly when it comes to raising taxes on the wealthy, something the Democratic president has sought.It’s something he suggested may need to wait until a second term.“I’m going to be coming back,” he said. “With your help, I’m going to win.”Biden's remarks were the most detailed comments from the Democratic president on the compromise he and his staff negotiated. He largely remained quiet publicly during the high-stakes talks, a decision that frustrated some members of his party but was intended to give space for both sides to reach a deal and for lawmakers to vote it to his desk.Biden praised McCarthy and his negotiators for operating in good faith, and all congressional leaders for ensuring swift passage of the legislation. “They acted responsibly, and put the good of the country ahead of politics,” he said.Overall, the 99-page bill restricts spending for the next two years and changes some policies, including imposing new work requirements for older Americans receiving food aid and greenlighting an Appalachian natural gas pipeline that many Democrats oppose. Some environmental rules were modified to help streamline approvals for infrastructure and energy projects — a move long sought by moderates in Congress.The Congressional Budget Office estimates it could actually expand total eligibility for federal food assistance, with the elimination of work requirements for veterans, homeless people and young people leaving foster care.The legislation also bolsters funds for defense and veterans, cuts back some new money for the Internal Revenue Service and rejects Biden’s call to roll back Trump-era tax breaks on corporations and the wealthy to help cover the nation’s deficits. But the White House said the IRS' plans to step up enforcement of tax laws for high-income earners and corporations would continue.The agreement imposes an automatic overall 1% cut to spending programs if Congress fails to approve its annual spending bills — a measure designed to pressure lawmakers of both parties to reach consensus before the end of the fiscal year in September.In both chambers, more Democrats backed the legislation than Republicans, but both parties were critical to its passage. In the Senate the tally was 63-36 including 46 Democrats and independents and 17 Republicans in favor, 31 Republicans along with four Democrats and one independent who caucuses with the Democrats opposed.The vote in the House was 314-117.___AP Congressional Correspondent Lisa Mascaro contributed to this report.

WASHINGTON —

President Joe Biden is expected to sign legislation on Saturday to raise the debt ceiling, just two days before the U.S. Treasury warned that the country would struggle to pay its bills.

The bipartisan measure, which was approved this week by the House and Senate, eliminates the potential for an unprecedented government default.

“Passing this budget agreement was critical. The stakes could not have been higher," Biden said from the Oval Office on Friday evening. “Nothing would have been more catastrophic,” he said, than defaulting on the country's debt.

The agreement was hashed out by Biden and House Speaker Kevin McCarthy, giving Republicans some of their demanded federal spending cuts but holding the line on major Democratic priorities. It raises the debt limit until 2025 — after the 2024 presidential election — and gives legislators budget targets for the next two years in hopes of assuring fiscal stability as the political season heats up.

“No one got everything they wanted but the American people got what they needed,” Biden said, highlighting the “compromise and consensus” in the deal. “We averted an economic crisis and an economic collapse.”

Video below: A closer look at the debt ceiling bill

Biden used the opportunity to itemize the achievements of his first term as he runs for reelection, including support for high-tech manufacturing, infrastructure investments and financial incentives for fighting climate change. He also highlighted ways he blunted Republican efforts to roll back his agenda and achieve deeper cuts.

“We’re cutting spending and bringing deficits down at the same time,” Biden said. “We're protecting important priorities from Social Security to Medicare to Medicaid to veterans to our transformational investments in infrastructure and clean energy.”

Even as he pledged to continue working with Republicans, Biden also drew contrasts with the opposing party, particularly when it comes to raising taxes on the wealthy, something the Democratic president has sought.

It’s something he suggested may need to wait until a second term.

“I’m going to be coming back,” he said. “With your help, I’m going to win.”

Biden's remarks were the most detailed comments from the Democratic president on the compromise he and his staff negotiated. He largely remained quiet publicly during the high-stakes talks, a decision that frustrated some members of his party but was intended to give space for both sides to reach a deal and for lawmakers to vote it to his desk.

Biden praised McCarthy and his negotiators for operating in good faith, and all congressional leaders for ensuring swift passage of the legislation. “They acted responsibly, and put the good of the country ahead of politics,” he said.

Overall, the 99-page bill restricts spending for the next two years and changes some policies, including imposing new work requirements for older Americans receiving food aid and greenlighting an Appalachian natural gas pipeline that many Democrats oppose. Some environmental rules were modified to help streamline approvals for infrastructure and energy projects — a move long sought by moderates in Congress.

The Congressional Budget Office estimates it could actually expand total eligibility for federal food assistance, with the elimination of work requirements for veterans, homeless people and young people leaving foster care.

The legislation also bolsters funds for defense and veterans, cuts back some new money for the Internal Revenue Service and rejects Biden’s call to roll back Trump-era tax breaks on corporations and the wealthy to help cover the nation’s deficits. But the White House said the IRS' plans to step up enforcement of tax laws for high-income earners and corporations would continue.

The agreement imposes an automatic overall 1% cut to spending programs if Congress fails to approve its annual spending bills — a measure designed to pressure lawmakers of both parties to reach consensus before the end of the fiscal year in September.

In both chambers, more Democrats backed the legislation than Republicans, but both parties were critical to its passage. In the Senate the tally was 63-36 including 46 Democrats and independents and 17 Republicans in favor, 31 Republicans along with four Democrats and one independent who caucuses with the Democrats opposed.

The vote in the House was 314-117.

___

AP Congressional Correspondent Lisa Mascaro contributed to this report.


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]]> https://cincylink.com/2023/06/03/biden-expected-to-sign-budget-deal-to-raise-debt-ceiling/feed/ 0 The Fed can’t figure out what’s happening with the job market https://cincylink.com/2023/06/02/the-fed-cant-figure-out-whats-happening-with-the-job-market/ https://cincylink.com/2023/06/02/the-fed-cant-figure-out-whats-happening-with-the-job-market/#respond Fri, 02 Jun 2023 13:21:21 +0000 https://cincylink.com/?p=200557

Policymakers at the Federal Reserve signaled last month that they were considering a pause in their 14-month-long regimen of hiking interest rates to cool the economy and bring down inflation.Related video above: Economy: Debt limit looms; inflation concernsBut the U.S. economy is like an engine that won’t quit — it just keeps on pumping out jobs. New data out Wednesday showed that job openings and hiring both rose in April, while unemployment sits near 53-year lows. With just two weeks left until the central bank’s next policy decision, it appears that more rate hikes could be coming after all.Investors — already contending with the fallout from the banking crisis, the lingering effects of debt ceiling turmoil and economic slowdowns in China and Europe — aren’t very happy about that prospect.What’s happeningThe number of available jobs in the United States rose unexpectedly in April after three months of declines.Job openings climbed to 10.1 million in April, according to data released Wednesday by the Bureau of Labor Statistics. Economists were expecting about 9.4 million, according to consensus estimates on Refinitiv. There are now 1.77 openings for every job seeker, the BLS data show. Hiring activity also grew and layoffs dropped in April.Job growth is healthy and that’s good for the economy. Business and consumer sentiment remain resilient and spending and investment are also proving to be relatively robust. But this could be another case of “good news is bad news” for the Federal Reserve. Fed Chair Jerome Powell has said that he wants to see more slack in the labor market. If there’s an imbalance between labor supply and demand, he says, wages will rise and add to upward pressure on prices.More data is expected before the Fed next decides on interest rates on June 14, including the closely-watched government jobs report Friday and the Consumer Price Index for May due June 13.Fed Governor Philip Jefferson said on Wednesday that a pause at the June meeting wouldn’t mean that hikes are finished but would instead give central bank officials more time to assess the state of the economy.“A decision to hold our policy rate constant at a coming meeting should not be interpreted to mean that we have reached the peak rate for this cycle,” said Jefferson in a speech. “Indeed, skipping a rate hike at a coming meeting would allow the committee to see more data before making decisions about the extent of additional policy firming.”Also complicating matters: The Fed’s favorite inflation gauge bounced higher in April. The Personal Consumption Expenditures price index rose 4.4% for the 12 months ended in April, up from a 4.2% increase seen in March, according to data released Friday by the Commerce Department.“It remains to be seen whether the Fed is prepared to pause or skip a rate hike at a forthcoming meeting,” said Bankrate senior economic analyst Mark Hamrick. “While the Fed is still talking like it is on the inflation righting warpath, the resilience and strength of the job market have been remarkable.” Markets are currently placing the probability of a quarter percentage point rate hike in June only at about 30%, according to CME FedWatch. That’s up from around 0% in mid-May. Prior to Jefferson’s speech, markets were pricing in a 70% chance. “After last month’s meeting, it seemed certain that the word change signaled that the Fed was on pause,” said Sam Stovall, chief investment strategist at CFRA research. “However, due to stronger-than-expected economic reports, stickier-than-anticipated inflation readings, and increasingly hawkish Fedspeak, we now see the postponing its pause and raising rates by ,” he said. The bottom lineUncertainty seems to be the name of the game right now. “Markets may wish for a Fed pivot, but we believe that hope is not a strategy,” said David Kotok, chairman and chief investment officer at Cumberland Advisors. “Of course,” he added, “that could change at any time.”Debt ceiling deal makes its way to the Senate The House of Representatives passed the deal to suspend the nation’s debt ceiling through Jan. 1, 2025, late on Wednesday night. The final tally for the vote was 314 to 117. The bill now needs to be passed by the Senate before it can be sent to President Joe Biden to be signed into law. It’s not yet clear when the Senate will vote, but Senate Minority Leader Mitch McConnell told reporters on Wednesday that he hopes the Senate will finish voting on the debt ceiling agreement on Thursday or Friday“Tonight, the House took a critical step forward to prevent a first-ever default and protect our country’s hard-earned and historic economic recovery,” Biden said in a statement moments after the House voted. “This budget agreement is a bipartisan compromise. Neither side got everything it wanted. That’s the responsibility of governing.”But while Biden celebrated the news, investors weren’t as excited. Stock futures inched up immediately after the bill passed through the House but quickly dropped down again. They were narrowly higher early on Thursday.That could be because of lingering concerns about its passage through the Senate, but also because other worries are likely to return center stage.Economic problems in China have been rattling US markets. Factory activity in China dropped to new lows for the second month in a row, fueling investor fears that the country’s post-Covid economic boom is ending. American CEOs, including JPMorgan (JPM) chief Jamie Dimon and Tesla (TSLA) head Elon Musk, have flocked to China this week to assess the risks to their investments in the country.Dimon for president? Jamie Dimon is arguably the most powerful man in corporate America. He may be eying political power, too. Normally, Dimon is quick to shoot down speculation that he could run for office. But in an interview with Bloomberg Television released on Wednesday, Dimon didn’t rule it out.Asked if he’s ever considered a public office position, Dimon said: “I love my country, and maybe one day I’ll serve my country in one capacity or another.”Dimon, 67, stressed that he’s focused on running JPMorgan, a role that has become even more complex amid the banking crisis and the ongoing debate over the debt ceiling, reports my colleague Matt Egan. “I love what I do,” Dimon told Bloomberg, adding he’s “quite happy” in his current job. He noted JPMorgan does a “great job helping Americans, for helping countries around the world.”In 2016, Dimon said he’d “love to be president” but added it’s “too hard and too late” for him to do that.

Policymakers at the Federal Reserve signaled last month that they were considering a pause in their 14-month-long regimen of hiking interest rates to cool the economy and bring down inflation.

Related video above: Economy: Debt limit looms; inflation concerns

But the U.S. economy is like an engine that won’t quit — it just keeps on pumping out jobs. New data out Wednesday showed that job openings and hiring both rose in April, while unemployment sits near 53-year lows. With just two weeks left until the central bank’s next policy decision, it appears that more rate hikes could be coming after all.

Investors — already contending with the fallout from the banking crisis, the lingering effects of debt ceiling turmoil and economic slowdowns in China and Europe — aren’t very happy about that prospect.

What’s happening

The number of available jobs in the United States rose unexpectedly in April after three months of declines.

Job openings climbed to 10.1 million in April, according to data released Wednesday by the Bureau of Labor Statistics. Economists were expecting about 9.4 million, according to consensus estimates on Refinitiv.

There are now 1.77 openings for every job seeker, the BLS data show. Hiring activity also grew and layoffs dropped in April.

Job growth is healthy and that’s good for the economy. Business and consumer sentiment remain resilient and spending and investment are also proving to be relatively robust. But this could be another case of “good news is bad news” for the Federal Reserve.

Fed Chair Jerome Powell has said that he wants to see more slack in the labor market. If there’s an imbalance between labor supply and demand, he says, wages will rise and add to upward pressure on prices.

More data is expected before the Fed next decides on interest rates on June 14, including the closely-watched government jobs report Friday and the Consumer Price Index for May due June 13.

Fed Governor Philip Jefferson said on Wednesday that a pause at the June meeting wouldn’t mean that hikes are finished but would instead give central bank officials more time to assess the state of the economy.

“A decision to hold our policy rate constant at a coming meeting should not be interpreted to mean that we have reached the peak rate for this cycle,” said Jefferson in a speech. “Indeed, skipping a rate hike at a coming meeting would allow the committee to see more data before making decisions about the extent of additional policy firming.”

Also complicating matters: The Fed’s favorite inflation gauge bounced higher in April. The Personal Consumption Expenditures price index rose 4.4% for the 12 months ended in April, up from a 4.2% increase seen in March, according to data released Friday by the Commerce Department.

“It remains to be seen whether the Fed is prepared to pause or skip a rate hike at a forthcoming meeting,” said Bankrate senior economic analyst Mark Hamrick. “While the Fed is still talking like it is on the inflation righting warpath, the resilience and strength of the job market have been remarkable.”

Markets are currently placing the probability of a quarter percentage point rate hike in June only at about 30%, according to CME FedWatch. That’s up from around 0% in mid-May. Prior to Jefferson’s speech, markets were pricing in a 70% chance.

“After last month’s meeting, it seemed certain that the word change signaled that the Fed was on pause,” said Sam Stovall, chief investment strategist at CFRA research.

“However, due to stronger-than-expected economic reports, stickier-than-anticipated inflation readings, and increasingly hawkish Fedspeak, we now see the [Fed] postponing its pause and raising rates by [a quarter percentage point],” he said.

The bottom line

Uncertainty seems to be the name of the game right now. “Markets may wish for a Fed pivot, but we believe that hope is not a strategy,” said David Kotok, chairman and chief investment officer at Cumberland Advisors. “Of course,” he added, “that could change at any time.”

Debt ceiling deal makes its way to the Senate

The House of Representatives passed the deal to suspend the nation’s debt ceiling through Jan. 1, 2025, late on Wednesday night. The final tally for the vote was 314 to 117.

The bill now needs to be passed by the Senate before it can be sent to President Joe Biden to be signed into law.

It’s not yet clear when the Senate will vote, but Senate Minority Leader Mitch McConnell told reporters on Wednesday that he hopes the Senate will finish voting on the debt ceiling agreement on Thursday or Friday

“Tonight, the House took a critical step forward to prevent a first-ever default and protect our country’s hard-earned and historic economic recovery,” Biden said in a statement moments after the House voted. “This budget agreement is a bipartisan compromise. Neither side got everything it wanted. That’s the responsibility of governing.”

But while Biden celebrated the news, investors weren’t as excited. Stock futures inched up immediately after the bill passed through the House but quickly dropped down again. They were narrowly higher early on Thursday.

That could be because of lingering concerns about its passage through the Senate, but also because other worries are likely to return center stage.

Economic problems in China have been rattling US markets.

Factory activity in China dropped to new lows for the second month in a row, fueling investor fears that the country’s post-Covid economic boom is ending. American CEOs, including JPMorgan (JPM) chief Jamie Dimon and Tesla (TSLA) head Elon Musk, have flocked to China this week to assess the risks to their investments in the country.

Dimon for president?

Jamie Dimon is arguably the most powerful man in corporate America. He may be eying political power, too.

Normally, Dimon is quick to shoot down speculation that he could run for office. But in an interview with Bloomberg Television released on Wednesday, Dimon didn’t rule it out.

Asked if he’s ever considered a public office position, Dimon said: “I love my country, and maybe one day I’ll serve my country in one capacity or another.”

Dimon, 67, stressed that he’s focused on running JPMorgan, a role that has become even more complex amid the banking crisis and the ongoing debate over the debt ceiling, reports my colleague Matt Egan.

“I love what I do,” Dimon told Bloomberg, adding he’s “quite happy” in his current job. He noted JPMorgan does a “great job helping Americans, for helping countries around the world.”

In 2016, Dimon said he’d “love to be president” but added it’s “too hard and too late” for him to do that.


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]]> https://cincylink.com/2023/06/02/the-fed-cant-figure-out-whats-happening-with-the-job-market/feed/ 0 Biden, McCarthy reach final deal to prevent default, now must sell to Congress https://cincylink.com/2023/05/29/biden-mccarthy-reach-final-deal-to-prevent-default-now-must-sell-to-congress/ https://cincylink.com/2023/05/29/biden-mccarthy-reach-final-deal-to-prevent-default-now-must-sell-to-congress/#respond Mon, 29 May 2023 04:07:09 +0000 https://cincylink.com/?p=199473

With days to spare before a potential first-ever government default, President Joe Biden and House Speaker Kevin McCarthy reached a final agreement Sunday on a deal to raise the nation's debt ceiling while trying to ensure enough Republican and Democratic votes to pass the measure in the coming week.The Democratic president and Republican speaker spoke with each other Sunday evening as negotiators rushed to draft and post the 99-page bill text so lawmakers can review compromises that neither the hard-right or left flank is likely to support. Instead, the leaders are working to gather backing from the political middle as Congress hurries toward votes before a June 5 deadline to avert a damaging federal default.“Good news,” Biden declared Sunday evening at the White House."The agreement prevents the worst possible crisis, a default, for the first time in our nation’s history,” he said. “Takes the threat of a catastrophic default off the table.”The president urged both parties in Congress to come together for swift passage. "The speaker and I made clear from the start that the only way forward was a bipartisan agreement,” he said. The compromise announced late Saturday includes spending cuts but risks angering some lawmakers as they take a closer look at the concessions. Biden told reporters at the White House upon his return from Delaware that he was confident the plan will make it to his desk. The bill was posted Sunday evening.McCarthy, too, was confident in remarks at the Capitol: "At the end of the day, people can look together to be able to pass this."The days ahead will determine whether Washington is again able to narrowly avoid a default on U.S. debt, as it has done many times before, or whether the global economy enters a potential crisis.In the United States, a default could cause financial markets to freeze up and spark an international financial crisis. Analysts say millions of jobs would vanish, borrowing and unemployment rates would jump, and a stock-market plunge could erase trillions of dollars in household wealth. It would all but shatter the $24 trillion market for Treasury debt.Anxious retirees and others were already making contingency plans for missed checks, with the next Social Security payments due soon as the world watches American leadership at stake.McCarthy and his negotiators portrayed the deal as delivering for Republicans though it fell well short of the sweeping spending cuts they sought. Top White House officials were briefing Democratic lawmakers and phoning some directly to try to shore up support.As Sunday dragged on, negotiators labored to write the bill text and lawmakers raised questions.McCarthy told reporters at the Capitol on Sunday that the agreement "doesn't get everything everybody wanted," but that was to be expected in a divided government. Privately, he told lawmakers on a conference call that Democrats "got nothing" they wanted.A White House statement from the president, issued after Biden and McCarthy spoke by phone Saturday evening and an agreement in principle followed, said the deal "prevents what could have been a catastrophic default."Support from both parties will be needed to win congressional approval before a projected June 5 government default on U.S. debts. Lawmakers are not expected to return to work from the Memorial Day weekend before Tuesday, at the earliest, and McCarthy has promised lawmakers he will abide by the rule to post any bill for 72 hours before voting.Negotiators agreed to some Republican demands for increased work requirements for recipients of food stamps that House Democrats had called a non-starter.With the outlines of an agreement in place, the legislative package could be drafted and shared with lawmakers in time for House votes as soon as Wednesday, and later in the coming week in the Senate.Central to the compromise is a two-year budget deal that would essentially hold spending flat for 2024, while boosting it for defense and veterans, and capping increases at 1% for 2025. That's alongside raising the debt limit for two years, pushing the volatile political issue past the next presidential election.Driving hard to impose tougher work requirements on government aid recipients, Republicans achieved some of what they wanted. It ensures people ages 49 to 54 with food stamp aid would have to meet work requirements if they are able-bodied and without dependents. Biden was able to secure waivers for veterans and homeless people.The deal puts in place changes in the landmark National Environmental Policy Act designating "a single lead agency" to develop environmental reviews, in hopes of streamlining the process.It halts some funds to hire new Internal Revenue Service agents as Republicans demanded, and rescinds some $30 billion for coronavirus relief, keeping $5 billion for developing the next generation of COVID-19 vaccines.The deal came together after Treasury Secretary Janet Yellen told Congress that the United States could default on its debt obligations by June 5 — four days later than previously estimated — if lawmakers did not act in time. Lifting the nation's debt limit, now at $31 trillion, allows more borrowing to pay bills already insured.McCarthy commands only a slim Republican majority in the House, where hard-right conservatives may resist any deal as insufficient as they try to slash spending. By compromising with Democrats, he risks losing support from his own members, setting up a career-challenging moment for the new speaker."I think you're going to get a majority of Republicans voting for this bill," McCarthy said on "Fox News Sunday," adding that because Biden backed it, "I think there's going to be a lot of Democrats that will vote for it, too."House Democratic leader Hakeem Jeffries of New York said on CBS' "Face the Nation" that he expected there will be Democratic support but he declined to provide a number. Asked whether he could guarantee there would not be a default, he said, "Yes."A 100-strong group of moderates in the New Democratic Coalition gave a crucial nod of support on Sunday, saying in a statement it was confident that Biden and his team "delivered a viable, bipartisan solution to end this crisis" and were working to ensure the agreement would receive support from both parties.The coalition could provide enough support for McCarthy to make up for members in the right flank of his party who have expressed opposition before the bill's wording was even released.It also takes the pressure off Biden, facing criticism from progressives for giving into what they call hostage-taking by Republicans.Democratic Rep. Pramila Jayapal of Washington state, who leads the Congressional Progressive Caucus, told CBS that the White House and Jeffries should worry about whether caucus members will support the agreement.

WASHINGTON —

With days to spare before a potential first-ever government default, President Joe Biden and House Speaker Kevin McCarthy reached a final agreement Sunday on a deal to raise the nation's debt ceiling while trying to ensure enough Republican and Democratic votes to pass the measure in the coming week.

The Democratic president and Republican speaker spoke with each other Sunday evening as negotiators rushed to draft and post the 99-page bill text so lawmakers can review compromises that neither the hard-right or left flank is likely to support. Instead, the leaders are working to gather backing from the political middle as Congress hurries toward votes before a June 5 deadline to avert a damaging federal default.

“Good news,” Biden declared Sunday evening at the White House.

"The agreement prevents the worst possible crisis, a default, for the first time in our nation’s history,” he said. “Takes the threat of a catastrophic default off the table.”

The president urged both parties in Congress to come together for swift passage. "The speaker and I made clear from the start that the only way forward was a bipartisan agreement,” he said.

The compromise announced late Saturday includes spending cuts but risks angering some lawmakers as they take a closer look at the concessions. Biden told reporters at the White House upon his return from Delaware that he was confident the plan will make it to his desk. The bill was posted Sunday evening.

McCarthy, too, was confident in remarks at the Capitol: "At the end of the day, people can look together to be able to pass this."

The days ahead will determine whether Washington is again able to narrowly avoid a default on U.S. debt, as it has done many times before, or whether the global economy enters a potential crisis.

In the United States, a default could cause financial markets to freeze up and spark an international financial crisis. Analysts say millions of jobs would vanish, borrowing and unemployment rates would jump, and a stock-market plunge could erase trillions of dollars in household wealth. It would all but shatter the $24 trillion market for Treasury debt.

Anxious retirees and others were already making contingency plans for missed checks, with the next Social Security payments due soon as the world watches American leadership at stake.

McCarthy and his negotiators portrayed the deal as delivering for Republicans though it fell well short of the sweeping spending cuts they sought. Top White House officials were briefing Democratic lawmakers and phoning some directly to try to shore up support.

As Sunday dragged on, negotiators labored to write the bill text and lawmakers raised questions.

McCarthy told reporters at the Capitol on Sunday that the agreement "doesn't get everything everybody wanted," but that was to be expected in a divided government. Privately, he told lawmakers on a conference call that Democrats "got nothing" they wanted.

A White House statement from the president, issued after Biden and McCarthy spoke by phone Saturday evening and an agreement in principle followed, said the deal "prevents what could have been a catastrophic default."

Support from both parties will be needed to win congressional approval before a projected June 5 government default on U.S. debts. Lawmakers are not expected to return to work from the Memorial Day weekend before Tuesday, at the earliest, and McCarthy has promised lawmakers he will abide by the rule to post any bill for 72 hours before voting.

Negotiators agreed to some Republican demands for increased work requirements for recipients of food stamps that House Democrats had called a non-starter.

With the outlines of an agreement in place, the legislative package could be drafted and shared with lawmakers in time for House votes as soon as Wednesday, and later in the coming week in the Senate.

Central to the compromise is a two-year budget deal that would essentially hold spending flat for 2024, while boosting it for defense and veterans, and capping increases at 1% for 2025. That's alongside raising the debt limit for two years, pushing the volatile political issue past the next presidential election.

Driving hard to impose tougher work requirements on government aid recipients, Republicans achieved some of what they wanted. It ensures people ages 49 to 54 with food stamp aid would have to meet work requirements if they are able-bodied and without dependents. Biden was able to secure waivers for veterans and homeless people.

The deal puts in place changes in the landmark National Environmental Policy Act designating "a single lead agency" to develop environmental reviews, in hopes of streamlining the process.

It halts some funds to hire new Internal Revenue Service agents as Republicans demanded, and rescinds some $30 billion for coronavirus relief, keeping $5 billion for developing the next generation of COVID-19 vaccines.

The deal came together after Treasury Secretary Janet Yellen told Congress that the United States could default on its debt obligations by June 5 — four days later than previously estimated — if lawmakers did not act in time. Lifting the nation's debt limit, now at $31 trillion, allows more borrowing to pay bills already insured.

McCarthy commands only a slim Republican majority in the House, where hard-right conservatives may resist any deal as insufficient as they try to slash spending. By compromising with Democrats, he risks losing support from his own members, setting up a career-challenging moment for the new speaker.

"I think you're going to get a majority of Republicans voting for this bill," McCarthy said on "Fox News Sunday," adding that because Biden backed it, "I think there's going to be a lot of Democrats that will vote for it, too."

House Democratic leader Hakeem Jeffries of New York said on CBS' "Face the Nation" that he expected there will be Democratic support but he declined to provide a number. Asked whether he could guarantee there would not be a default, he said, "Yes."

A 100-strong group of moderates in the New Democratic Coalition gave a crucial nod of support on Sunday, saying in a statement it was confident that Biden and his team "delivered a viable, bipartisan solution to end this crisis" and were working to ensure the agreement would receive support from both parties.

The coalition could provide enough support for McCarthy to make up for members in the right flank of his party who have expressed opposition before the bill's wording was even released.

It also takes the pressure off Biden, facing criticism from progressives for giving into what they call hostage-taking by Republicans.

Democratic Rep. Pramila Jayapal of Washington state, who leads the Congressional Progressive Caucus, told CBS that the White House and Jeffries should worry about whether caucus members will support the agreement.


Source link

]]> https://cincylink.com/2023/05/29/biden-mccarthy-reach-final-deal-to-prevent-default-now-must-sell-to-congress/feed/ 0 Biden and GOP agree to 2-year budget-debt ceiling deal https://cincylink.com/2023/05/28/biden-and-gop-agree-to-2-year-budget-debt-ceiling-deal/ https://cincylink.com/2023/05/28/biden-and-gop-agree-to-2-year-budget-debt-ceiling-deal/#respond Sun, 28 May 2023 04:07:11 +0000 https://cincylink.com/?p=199228

President Joe Biden and House Speaker Kevin McCarthy reached an "agreement in principle" late Saturday as they raced to strike a deal to limit federal spending and resolve the looming debt crisis ahead of a June 5 deadline, the House speaker said.Video above: House Speaker Kevin McCarthy speaks after agreement in principle madeA deal would avert a catastrophic U.S. default, but risks angering both Democratic and Republican sides with the concessions made to reach it.The Democratic president and Republican speaker reached the agreement after the two spoke earlier Saturday evening by phone, said McCarthy, speaking Saturday night. The country and the world have been watching and waiting for a resolution to the political standoff that threatened the U.S. and global economy.With the outlines of a deal in place, the legislative package could be drafted and shared with lawmakers in time for votes early next week in the House and later in the Senate.Central to the package is a two-year budget deal that would hold spending flat for 2024 and impose limits for 2025 in exchange for raising the debt limit for two years, pushing the volatile political issue past the next presidential election.Negotiators agreed to some Republican demands for enhanced work requirements on recipients of food stamps that had sparked an uproar from House Democrats as a non-starter.Video above: Why the United States has a debt ceilingBiden also spoke earlier in the day with Democratic leaders in Congress to discuss the status of the talks, according to three people familiar with the situation, who spoke on condition of anonymity because they were not authorized to discuss the matter publicly.The Republican House speaker had gathered top allies behind closed doors at the Capitol as negotiators pushed for a deal that would raise the nation's borrowing limit and avoid a first-ever default on the federal debt, while also making spending cuts that House Republicans are demanding.As he arrived at the Capitol early in the day, McCarthy said that Republican negotiators were "closer to an agreement."McCarthy's comments had echoed the latest public assessment from Biden, who said Friday evening that bargainers were "very close." Biden and McCarthy last met face-to-face on the matter Monday.Their new discussion Saturday by phone came after Treasury Secretary Janet Yellen told Congress that the United States could default on its debt obligations by June 5 – four days later than previously estimated – if lawmakers do not act in time to raise the federal debt ceiling. The extended "X-date" gives the two sides a bit of extra time as they scramble for a deal.But as another day dragged on with financial disaster looming closer, it had appeared some of the problems over policy issues that dogged talks all week remained unresolved.Both sides have suggested one of the main holdups is a GOP effort to expand existing work requirements for recipients of food stamps and other federal aid programs, a longtime Republican goal that Democrats have strenuously opposed. The White House said the Republican proposals were "cruel and senseless."They also appeared to still be laboring over a compromise on federal permitting changes that would ease regulations for developing oil, gas and renewable energy projects and foster new transmission line connections.McCarthy, who dashed out before the lunch hour Saturday and arrived back at the Capitol with a big box of takeout, declined to elaborate on those discussions. One of his negotiators, Louisiana Rep. Garret Graves, said there was "not a chance" that Republicans might relent on the work requirements issue.Video above: What is the debt ceiling?Americans and the world were uneasily watching the negotiating brinkmanship that could throw the U.S. economy into chaos and sap world confidence in the nation's leadership. House negotiators left the Capitol at 2 a.m. the night before, only to return hours later.Failure to lift the borrowing limit, now $31 trillion, to pay the nation's incurred bills, would send shockwaves through the U.S. and global economy. Yellen said failure to act by the new date would "cause severe hardship to American families, harm our global leadership position and raise questions about our ability to defend our national security interests."Anxious retirees and others were already making contingency plans for missed checks, with the next Social Security payments due next week.The president, spending part of the weekend at Camp David, continued to talk with his negotiating team multiple times a day, signing off on offers and counteroffers. Biden was upbeat as he departed the White House on Friday evening, saying: "It's very close, and I'm optimistic."All sides also are hearing from other lawmakers, including Sen. Kyrsten Sinema, the independent from Arizona, who has been in the center of big policy debates, and Rep. Josh Gottheimer, D-N.J., of the bipartisan Problem Solvers Caucus.Biden and McCarthy have seemed to be narrowing on a two-year budget-cutting deal that would also extend the debt limit into 2025 past the next presidential election. The contours of the deal have been taking shape to cut spending for 2024 and impose a 1% cap on spending growth for 2025.Rep. Tom Emmer of Minnesota, the Republican whip who is in charge of counting the votes from McCarthy's slim majority to ensure passage of any deal, said he is telling rank-and-file lawmakers not to believe what they're hearing until party leaders deliver the news about any deal.Any deal would need to be a political compromise in a divided Congress. Many of the hard-right Trump-aligned Republicans in Congress have long been skeptical of the Treasury's projections, and they are pressing McCarthy to hold out.Video above: What could happen if U.S. defaults"We're constantly in touch with our members, letting them know that what is being reported, you should not accept that," Emmer said. "If there's an agreement, we will let them know."The Republican proposal on work requirements would save $11 billion over 10 years by raising the maximum age for existing standards that require able-bodied adults who do not live with dependents to work or attend training programs.Current law applies those standards to recipients under the age of 50. The GOP plan would raise the age to include adults 55 and under. It would lower the number of exemptions that states can grant to some recipients subject to those requirements.Biden has said the work requirements for Medicaid would be a non-starter. He initially seemed potentially open to negotiating minor changes on food stamps, now known as the Supplemental Nutrition Assistance Program, or SNAP, but his position has appeared to harden.Lawmakers are not expected to return to work from the Memorial Day weekend before Tuesday, at the earliest, and McCarthy has promised lawmakers he will abide by the rule to post any bill for 72 hours before voting.The Democratic-held Senate has largely stayed out of the negotiations, leaving the talks to Biden and McCarthy. Senate Majority Leader Chuck Schumer of New York has pledged to move quickly to send a compromise package to Biden's desk.Weeks of talks have failed to produce a deal in part because the Biden administration resisted for months on negotiating with McCarthy, arguing that the country's full faith and credit should not be used as leverage to extract other partisan priorities.But House Republicans united behind a plan to cut spending, narrowly passing legislation in late April that would raise the debt ceiling in exchange for the spending reductions.Associated Press writers Zeke Miller, Stephen Groves, Fatima Hussein, Farnoush Amiri, Seung Min Kim and videojournalist Rick Gentilo contributed to this report.

WASHINGTON —

President Joe Biden and House Speaker Kevin McCarthy reached an "agreement in principle" late Saturday as they raced to strike a deal to limit federal spending and resolve the looming debt crisis ahead of a June 5 deadline, the House speaker said.

Video above: House Speaker Kevin McCarthy speaks after agreement in principle made

A deal would avert a catastrophic U.S. default, but risks angering both Democratic and Republican sides with the concessions made to reach it.

The Democratic president and Republican speaker reached the agreement after the two spoke earlier Saturday evening by phone, said McCarthy, speaking Saturday night. The country and the world have been watching and waiting for a resolution to the political standoff that threatened the U.S. and global economy.

With the outlines of a deal in place, the legislative package could be drafted and shared with lawmakers in time for votes early next week in the House and later in the Senate.

Central to the package is a two-year budget deal that would hold spending flat for 2024 and impose limits for 2025 in exchange for raising the debt limit for two years, pushing the volatile political issue past the next presidential election.

Negotiators agreed to some Republican demands for enhanced work requirements on recipients of food stamps that had sparked an uproar from House Democrats as a non-starter.

Video above: Why the United States has a debt ceiling

Biden also spoke earlier in the day with Democratic leaders in Congress to discuss the status of the talks, according to three people familiar with the situation, who spoke on condition of anonymity because they were not authorized to discuss the matter publicly.

The Republican House speaker had gathered top allies behind closed doors at the Capitol as negotiators pushed for a deal that would raise the nation's borrowing limit and avoid a first-ever default on the federal debt, while also making spending cuts that House Republicans are demanding.

As he arrived at the Capitol early in the day, McCarthy said that Republican negotiators were "closer to an agreement."

McCarthy's comments had echoed the latest public assessment from Biden, who said Friday evening that bargainers were "very close." Biden and McCarthy last met face-to-face on the matter Monday.

Their new discussion Saturday by phone came after Treasury Secretary Janet Yellen told Congress that the United States could default on its debt obligations by June 5 – four days later than previously estimated – if lawmakers do not act in time to raise the federal debt ceiling. The extended "X-date" gives the two sides a bit of extra time as they scramble for a deal.

But as another day dragged on with financial disaster looming closer, it had appeared some of the problems over policy issues that dogged talks all week remained unresolved.

Both sides have suggested one of the main holdups is a GOP effort to expand existing work requirements for recipients of food stamps and other federal aid programs, a longtime Republican goal that Democrats have strenuously opposed. The White House said the Republican proposals were "cruel and senseless."

They also appeared to still be laboring over a compromise on federal permitting changes that would ease regulations for developing oil, gas and renewable energy projects and foster new transmission line connections.

McCarthy, who dashed out before the lunch hour Saturday and arrived back at the Capitol with a big box of takeout, declined to elaborate on those discussions. One of his negotiators, Louisiana Rep. Garret Graves, said there was "not a chance" that Republicans might relent on the work requirements issue.

Video above: What is the debt ceiling?

Americans and the world were uneasily watching the negotiating brinkmanship that could throw the U.S. economy into chaos and sap world confidence in the nation's leadership. House negotiators left the Capitol at 2 a.m. the night before, only to return hours later.

Failure to lift the borrowing limit, now $31 trillion, to pay the nation's incurred bills, would send shockwaves through the U.S. and global economy. Yellen said failure to act by the new date would "cause severe hardship to American families, harm our global leadership position and raise questions about our ability to defend our national security interests."

Anxious retirees and others were already making contingency plans for missed checks, with the next Social Security payments due next week.

The president, spending part of the weekend at Camp David, continued to talk with his negotiating team multiple times a day, signing off on offers and counteroffers. Biden was upbeat as he departed the White House on Friday evening, saying: "It's very close, and I'm optimistic."

All sides also are hearing from other lawmakers, including Sen. Kyrsten Sinema, the independent from Arizona, who has been in the center of big policy debates, and Rep. Josh Gottheimer, D-N.J., of the bipartisan Problem Solvers Caucus.

Biden and McCarthy have seemed to be narrowing on a two-year budget-cutting deal that would also extend the debt limit into 2025 past the next presidential election. The contours of the deal have been taking shape to cut spending for 2024 and impose a 1% cap on spending growth for 2025.

Rep. Tom Emmer of Minnesota, the Republican whip who is in charge of counting the votes from McCarthy's slim majority to ensure passage of any deal, said he is telling rank-and-file lawmakers not to believe what they're hearing until party leaders deliver the news about any deal.

Any deal would need to be a political compromise in a divided Congress. Many of the hard-right Trump-aligned Republicans in Congress have long been skeptical of the Treasury's projections, and they are pressing McCarthy to hold out.

Video above: What could happen if U.S. defaults

"We're constantly in touch with our members, letting them know that what is being reported, you should not accept that," Emmer said. "If there's an agreement, we will let them know."

The Republican proposal on work requirements would save $11 billion over 10 years by raising the maximum age for existing standards that require able-bodied adults who do not live with dependents to work or attend training programs.

Current law applies those standards to recipients under the age of 50. The GOP plan would raise the age to include adults 55 and under. It would lower the number of exemptions that states can grant to some recipients subject to those requirements.

Biden has said the work requirements for Medicaid would be a non-starter. He initially seemed potentially open to negotiating minor changes on food stamps, now known as the Supplemental Nutrition Assistance Program, or SNAP, but his position has appeared to harden.

Lawmakers are not expected to return to work from the Memorial Day weekend before Tuesday, at the earliest, and McCarthy has promised lawmakers he will abide by the rule to post any bill for 72 hours before voting.

The Democratic-held Senate has largely stayed out of the negotiations, leaving the talks to Biden and McCarthy. Senate Majority Leader Chuck Schumer of New York has pledged to move quickly to send a compromise package to Biden's desk.

Weeks of talks have failed to produce a deal in part because the Biden administration resisted for months on negotiating with McCarthy, arguing that the country's full faith and credit should not be used as leverage to extract other partisan priorities.

But House Republicans united behind a plan to cut spending, narrowly passing legislation in late April that would raise the debt ceiling in exchange for the spending reductions.

Associated Press writers Zeke Miller, Stephen Groves, Fatima Hussein, Farnoush Amiri, Seung Min Kim and videojournalist Rick Gentilo contributed to this report.


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]]> https://cincylink.com/2023/05/28/biden-and-gop-agree-to-2-year-budget-debt-ceiling-deal/feed/ 0 Debt ceiling talks stuck on classic problem: spending cuts https://cincylink.com/2023/05/25/debt-ceiling-talks-stuck-on-classic-problem-spending-cuts/ https://cincylink.com/2023/05/25/debt-ceiling-talks-stuck-on-classic-problem-spending-cuts/#respond Thu, 25 May 2023 04:10:06 +0000 https://cincylink.com/?p=198036

Debt ceiling negotiations are locked on a classic problem that has vexed, divided and disrupted Washington before: Republicans led by House Speaker Kevin McCarthy want to roll back federal government spending, while President Joe Biden and other Democrats do not.Time is short to strike a deal before a deadline as soon as June 1, when the Treasury says the government risks running out of cash to pay its bills. Negotiators are expected to convene Wednesday for another round of talks as frustration mounts. The political standoff is edging the country closer to a crisis, roiling financial markets and threatening the global economy."They've got to acknowledge that we're spending too much," said McCarthy.Cheered on by a hard-charging conservative House majority that hoisted him to power, McCarthy, R-Calif., was not swayed by a White House counter-offer to freeze spending instead. "A freeze is not going to work," McCarthy said.Video above: Why the United States has a debt ceilingThe longstanding Washington debate over the size and scope of the federal government now has just days to be resolved. Failure to raise the nation's debt ceiling, now at $31 trillion, would risk a potentially chaotic federal default, almost certain to inflict economic turmoil at home and abroad.From the White House, press secretary Karine Jean-Pierre said it was "ridiculous" to suggest Biden wasn't acting with urgency after Republicans complained about the pace. "He wants to see this done as soon as possible," she said.Dragging into a third week, the negotiations over raising the nation's debt limit were never supposed to arrive at this point.The White House insisted early on it was unwilling to barter over the need to pay the nation's bills, demanding that Congress simply lift the ceiling as it has done many times before with no strings attached.But the newly elected speaker visited Biden at the Oval Office in February, urging the president to come to the negotiating table on a budget package that would reduce spending and the nation's ballooning deficits in exchange for the vote to allow future debt."I told the president Feb. 1," McCarthy recounted. "I said, Mr. President, you're not going to raise taxes. You've got to spend less money than was spent this year."Negotiations are focused on finding agreement on a 2024 budget year limit. Republicans have set aside their demand to roll back spending to 2022 levels, but say that next year's government spending must be less than it is now. But the White House instead offered to freeze spending at current 2023 numbers."We are holding firm to the speaker's red line," said a top Republican negotiator, Rep. Garret Graves of Louisiana. "Which is that we will not do a deal unless it spends less money than we're spending this year."By sparing defense and some veterans accounts from reductions, the Republicans would shift the bulk of spending reductions to other federal programs, an approach that breaks a tradition in Congress of budget cap parity.Graves said there were still "significant gaps" between his side and the White House.Agreement on that topline spending level is vital. It would enable McCarthy to deliver spending restraints for conservatives while not being so severe that it would chase off the Democratic votes that would be needed in the divided Congress to pass any bill.But what, if anything, Democrats would get if they agreed to deeper spending cuts than Biden's team has proposed is uncertain.Asked what concessions the Republicans were willing to give, McCarthy quipped, "We're going to raise the debt ceiling."The White House has continued to argue that deficits can be reduced by ending tax breaks for wealthier households and some corporations, but McCarthy said he told the president at their February meeting that raising revenue from tax hikes is off the table.The negotiators are now also debating the duration of a 1% cap on annual spending growth going forward, with Republicans dropping their demand for a 10-year cap to six years, but the White House offering only one year, for 2025.Typically, the debt ceiling has been lifted for the duration of a budget deal, and in this negotiation the White House is angling for a two-year agreement that would push past the presidential elections.Past debt ceiling talks have produced budget agreements in which both parties have won some concessions in a give and take. Both have wanted to raise the debt limit to prevent a economy-shattering federal default.Graves explained the Republican position this time around. Since Biden already boosted federal spending in significant ways with his COVID-19 rescue package, Inflation Reduction Act and other bills, "they've already got theirs.""We're willing to give them an increase in debt ceiling. That's what they're getting," he said.And yet, the Republicans are pushing additional priorities as the negotiators focus on the $100 billion-plus difference between the 2022 and 2023 spending plans as a place to cut.Republicans want to beef up work requirements for government aid to recipients of food stamps, cash assistance and the Medicaid health care program that the Biden administration says would impact millions of people who depend on assistance.All sides have been eyeing the potential for the package to include a framework to ease federal regulations and speed energy project developments. They are all but certain to claw back some $30 billion in unspent COVID-19 funds now that the pandemic emergency has officially lifted.The White House has countered by keeping defense and nondefense spending flat next year, which would save $90 billion in the 2024 budget year and $1 trillion over 10 years.Video below: President Biden and Speaker Kevin McCarthy offered remarks from the Oval Office on MondayThe House speaker promised lawmakers he will abide by the rule to post any bill for 72 hours before voting, making any action doubtful until the weekend — just days before the potential deadline. The Senate would also have to pass the package before it could go to Biden's desk to be signed.McCarthy faces a hard-right flank in his own party that is likely to reject any deal, and that has led some Democrats to encourage Biden to resist any compromise with the Republicans and simply invoke the 14th Amendment to raise the debt ceiling on his own, an unprecedented and legally fraught action the president has resisted for now.___Associated Press writers Farnoush Amiri, Stephen Groves, Kevin Freking, Chris Megerian, Darlene Superville and Mary Clare Jalonick contributed to this report.

WASHINGTON —

Debt ceiling negotiations are locked on a classic problem that has vexed, divided and disrupted Washington before: Republicans led by House Speaker Kevin McCarthy want to roll back federal government spending, while President Joe Biden and other Democrats do not.

Time is short to strike a deal before a deadline as soon as June 1, when the Treasury says the government risks running out of cash to pay its bills. Negotiators are expected to convene Wednesday for another round of talks as frustration mounts. The political standoff is edging the country closer to a crisis, roiling financial markets and threatening the global economy.

"They've got to acknowledge that we're spending too much," said McCarthy.

Cheered on by a hard-charging conservative House majority that hoisted him to power, McCarthy, R-Calif., was not swayed by a White House counter-offer to freeze spending instead. "A freeze is not going to work," McCarthy said.

Video above: Why the United States has a debt ceiling

The longstanding Washington debate over the size and scope of the federal government now has just days to be resolved. Failure to raise the nation's debt ceiling, now at $31 trillion, would risk a potentially chaotic federal default, almost certain to inflict economic turmoil at home and abroad.

From the White House, press secretary Karine Jean-Pierre said it was "ridiculous" to suggest Biden wasn't acting with urgency after Republicans complained about the pace. "He wants to see this done as soon as possible," she said.

Dragging into a third week, the negotiations over raising the nation's debt limit were never supposed to arrive at this point.

The White House insisted early on it was unwilling to barter over the need to pay the nation's bills, demanding that Congress simply lift the ceiling as it has done many times before with no strings attached.

But the newly elected speaker visited Biden at the Oval Office in February, urging the president to come to the negotiating table on a budget package that would reduce spending and the nation's ballooning deficits in exchange for the vote to allow future debt.

"I told the president Feb. 1," McCarthy recounted. "I said, Mr. President, you're not going to raise taxes. You've got to spend less money than was spent this year."

Negotiations are focused on finding agreement on a 2024 budget year limit. Republicans have set aside their demand to roll back spending to 2022 levels, but say that next year's government spending must be less than it is now. But the White House instead offered to freeze spending at current 2023 numbers.

"We are holding firm to the speaker's red line," said a top Republican negotiator, Rep. Garret Graves of Louisiana. "Which is that we will not do a deal unless it spends less money than we're spending this year."

By sparing defense and some veterans accounts from reductions, the Republicans would shift the bulk of spending reductions to other federal programs, an approach that breaks a tradition in Congress of budget cap parity.

Graves said there were still "significant gaps" between his side and the White House.

Agreement on that topline spending level is vital. It would enable McCarthy to deliver spending restraints for conservatives while not being so severe that it would chase off the Democratic votes that would be needed in the divided Congress to pass any bill.

But what, if anything, Democrats would get if they agreed to deeper spending cuts than Biden's team has proposed is uncertain.

Asked what concessions the Republicans were willing to give, McCarthy quipped, "We're going to raise the debt ceiling."

The White House has continued to argue that deficits can be reduced by ending tax breaks for wealthier households and some corporations, but McCarthy said he told the president at their February meeting that raising revenue from tax hikes is off the table.

The negotiators are now also debating the duration of a 1% cap on annual spending growth going forward, with Republicans dropping their demand for a 10-year cap to six years, but the White House offering only one year, for 2025.

Typically, the debt ceiling has been lifted for the duration of a budget deal, and in this negotiation the White House is angling for a two-year agreement that would push past the presidential elections.

Past debt ceiling talks have produced budget agreements in which both parties have won some concessions in a give and take. Both have wanted to raise the debt limit to prevent a economy-shattering federal default.

Graves explained the Republican position this time around. Since Biden already boosted federal spending in significant ways with his COVID-19 rescue package, Inflation Reduction Act and other bills, "they've already got theirs."

"We're willing to give them an increase in debt ceiling. That's what they're getting," he said.

And yet, the Republicans are pushing additional priorities as the negotiators focus on the $100 billion-plus difference between the 2022 and 2023 spending plans as a place to cut.

Republicans want to beef up work requirements for government aid to recipients of food stamps, cash assistance and the Medicaid health care program that the Biden administration says would impact millions of people who depend on assistance.

All sides have been eyeing the potential for the package to include a framework to ease federal regulations and speed energy project developments. They are all but certain to claw back some $30 billion in unspent COVID-19 funds now that the pandemic emergency has officially lifted.

The White House has countered by keeping defense and nondefense spending flat next year, which would save $90 billion in the 2024 budget year and $1 trillion over 10 years.

Video below: President Biden and Speaker Kevin McCarthy offered remarks from the Oval Office on Monday

The House speaker promised lawmakers he will abide by the rule to post any bill for 72 hours before voting, making any action doubtful until the weekend — just days before the potential deadline. The Senate would also have to pass the package before it could go to Biden's desk to be signed.

McCarthy faces a hard-right flank in his own party that is likely to reject any deal, and that has led some Democrats to encourage Biden to resist any compromise with the Republicans and simply invoke the 14th Amendment to raise the debt ceiling on his own, an unprecedented and legally fraught action the president has resisted for now.

___

Associated Press writers Farnoush Amiri, Stephen Groves, Kevin Freking, Chris Megerian, Darlene Superville and Mary Clare Jalonick contributed to this report.


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]]> https://cincylink.com/2023/05/25/debt-ceiling-talks-stuck-on-classic-problem-spending-cuts/feed/ 0 Biden, GOP must decide what’s on the table for debt ceiling talks https://cincylink.com/2023/05/24/biden-gop-must-decide-whats-on-the-table-for-debt-ceiling-talks/ https://cincylink.com/2023/05/24/biden-gop-must-decide-whats-on-the-table-for-debt-ceiling-talks/#respond Wed, 24 May 2023 04:20:32 +0000 https://cincylink.com/?p=196188

Before President Joe Biden and congressional leaders can even try to avert an unprecedented U.S. government default, their initial challenge on Tuesday will be to agree on what exactly they're talking about as they hold their first substantive meeting in months.With the government at risk of being unable to meet its obligations as soon as June 1, raising the specter of potential economic calamity, Republicans are coming to the White House hoping to negotiate sweeping cuts to federal spending in exchange for allowing new borrowing to avoid default.Biden, on the other hand, is set to reinforce his opposition to allowing the country's full faith and credit to be held "hostage" to negotiations — and to affirm his willingness to hold talks on the budget only after default is no longer a threat.In the video player above: Treasury Secretary Janet Yellen is warning of the possibility of the government defaulting, potentially as early as June 1The chasm between these diametrically opposite postures is fomenting uncertainty that is already roiling financial markets and threatens to turn into a tidal wave that swamps the country's economy if not resolved.Default, officials say, would have sweeping impacts, threatening to disrupt Social Security payments to retirees, destabilize global markets and tilt the nation into a potentially debilitating recession.Biden's Oval Office meeting with House Speaker Kevin McCarthy, House Democratic leader Hakeem Jeffries, Senate Majority Leader Chuck Schumer and Minority Leader Mitch McConnell was set to begin at 4 p.m. — after U.S. financial markets close for the day.Expectations for a breakthrough are low.Treasury Secretary Janet Yellen acknowledged the "very big gap" between Democrats and Republicans in an interview Monday with CNBC."They're very far apart," she said. "The president hopes to establish a process for discussing and compromising on those issues, but he's not willing to do it with a gun to not only his head — more importantly, it's a gun to the head of the American people and the American economy."Video below: Pressure builds as debt ceiling fight continues. A senator explains what default would mean for the economyAlready looking past the meeting, Biden on Wednesday is set to go to Westchester County, N.Y., where he plans to deliver a speech on how proposed spending cuts approved by House Republicans could hurt teachers, older adults needing food aid and veterans seeking health care.It's part of a broader campaign by Biden to try to paint the Republican cuts as draconian. Aides believe that message both strengthens his position in talks with the GOP and boosts his nascent 2024 reelection effort. His Wednesday visit will be to a congressional district won by Biden in 2020, but that is now represented by a Republican, Rep. Mike Lawler.While calling for a "clean" increase to the debt limit, Biden has said he is open to discussion about how to reduce the federal deficit. His budget plan would trim deficits by nearly $3 trillion over a decade, mainly through tax increases on the wealthy and changes such as letting the government negotiate over prescription drug prices.By contrast, the bill that passed the House with Republican votes would achieve $4.5 trillion in deficit savings through cuts in spending, eliminating tax breaks for investing in clean energy, and reversing Biden's plans to reduce the burdens of student loan debt.McCarthy, R-Calif., has staked his speakership on extracting some concessions from Biden in exchange for raising the borrowing limit, with some of his members insisting they would withhold their votes on a debt measure unless all of their proposals made the final legislation.While the financial markets have started to show some jitters, the business community has thus far largely avoided backing either side in the showdown and instead called for a deal to be struck."Securing a bipartisan path forward to raise the debt ceiling could not be more urgent," said Josh Bolten, the head of the Business Roundtable, a group that represents CEOs. "The cost of a default, or even the threat of a default, is simply too high."Biden's refusal to negotiate on the debt limit is informed by his first-hand experience in 2011, when he was Barack Obama's vice president and the administration made painful concessions to Republicans in an effort to avoid default. Biden has told aides it's an experience he refuses to repeat, not just for himself, but for future presidents."There is no Plan B," Bharat Ramamurti, deputy director of the National Economic Council at the White House, told CNN on Monday. "Our plan is for Congress to act to address the debt limit, without conditions."Notably, though, the administration has not ruled out a short-term increase in the debt limit that would align the deadline to increase federal borrowing authority with the talks on government spending that must be resolved by Sept. 30.Though memories of the 2011 debt-limit standoff — which also featured a Democratic president and a Republican speaker — remain fresh in minds across Washington, aides to McConnell, the Senate GOP leader, have started to point to another, more recent battle as a more instructive example.In 2019, former President Donald Trump and Nancy Pelosi, then the newly reinstalled Democratic House speaker, reached a broader fiscal deal that not only raised the nation's borrowing authority for two years but staved off automatic budget cuts that both parties deplored.McConnell implored Trump at the time to negotiate directly with Pelosi and House Democrats, aides said — and the two parties were able to push off the prospect of a debt default beyond Trump's presidency despite political turmoil elsewhere.

WASHINGTON —

Before President Joe Biden and congressional leaders can even try to avert an unprecedented U.S. government default, their initial challenge on Tuesday will be to agree on what exactly they're talking about as they hold their first substantive meeting in months.

With the government at risk of being unable to meet its obligations as soon as June 1, raising the specter of potential economic calamity, Republicans are coming to the White House hoping to negotiate sweeping cuts to federal spending in exchange for allowing new borrowing to avoid default.

Biden, on the other hand, is set to reinforce his opposition to allowing the country's full faith and credit to be held "hostage" to negotiations — and to affirm his willingness to hold talks on the budget only after default is no longer a threat.

In the video player above: Treasury Secretary Janet Yellen is warning of the possibility of the government defaulting, potentially as early as June 1

The chasm between these diametrically opposite postures is fomenting uncertainty that is already roiling financial markets and threatens to turn into a tidal wave that swamps the country's economy if not resolved.

Default, officials say, would have sweeping impacts, threatening to disrupt Social Security payments to retirees, destabilize global markets and tilt the nation into a potentially debilitating recession.

Biden's Oval Office meeting with House Speaker Kevin McCarthy, House Democratic leader Hakeem Jeffries, Senate Majority Leader Chuck Schumer and Minority Leader Mitch McConnell was set to begin at 4 p.m. — after U.S. financial markets close for the day.

Expectations for a breakthrough are low.

Treasury Secretary Janet Yellen acknowledged the "very big gap" between Democrats and Republicans in an interview Monday with CNBC.

"They're very far apart," she said. "The president hopes to establish a process for discussing and compromising on those issues, but he's not willing to do it with a gun to not only his head — more importantly, it's a gun to the head of the American people and the American economy."

Video below: Pressure builds as debt ceiling fight continues. A senator explains what default would mean for the economy

Already looking past the meeting, Biden on Wednesday is set to go to Westchester County, N.Y., where he plans to deliver a speech on how proposed spending cuts approved by House Republicans could hurt teachers, older adults needing food aid and veterans seeking health care.

It's part of a broader campaign by Biden to try to paint the Republican cuts as draconian. Aides believe that message both strengthens his position in talks with the GOP and boosts his nascent 2024 reelection effort. His Wednesday visit will be to a congressional district won by Biden in 2020, but that is now represented by a Republican, Rep. Mike Lawler.

While calling for a "clean" increase to the debt limit, Biden has said he is open to discussion about how to reduce the federal deficit. His budget plan would trim deficits by nearly $3 trillion over a decade, mainly through tax increases on the wealthy and changes such as letting the government negotiate over prescription drug prices.

By contrast, the bill that passed the House with Republican votes would achieve $4.5 trillion in deficit savings through cuts in spending, eliminating tax breaks for investing in clean energy, and reversing Biden's plans to reduce the burdens of student loan debt.

McCarthy, R-Calif., has staked his speakership on extracting some concessions from Biden in exchange for raising the borrowing limit, with some of his members insisting they would withhold their votes on a debt measure unless all of their proposals made the final legislation.

While the financial markets have started to show some jitters, the business community has thus far largely avoided backing either side in the showdown and instead called for a deal to be struck.

"Securing a bipartisan path forward to raise the debt ceiling could not be more urgent," said Josh Bolten, the head of the Business Roundtable, a group that represents CEOs. "The cost of a default, or even the threat of a default, is simply too high."

Biden's refusal to negotiate on the debt limit is informed by his first-hand experience in 2011, when he was Barack Obama's vice president and the administration made painful concessions to Republicans in an effort to avoid default. Biden has told aides it's an experience he refuses to repeat, not just for himself, but for future presidents.

"There is no Plan B," Bharat Ramamurti, deputy director of the National Economic Council at the White House, told CNN on Monday. "Our plan is for Congress to act to address the debt limit, without conditions."

Notably, though, the administration has not ruled out a short-term increase in the debt limit that would align the deadline to increase federal borrowing authority with the talks on government spending that must be resolved by Sept. 30.

Though memories of the 2011 debt-limit standoff — which also featured a Democratic president and a Republican speaker — remain fresh in minds across Washington, aides to McConnell, the Senate GOP leader, have started to point to another, more recent battle as a more instructive example.

In 2019, former President Donald Trump and Nancy Pelosi, then the newly reinstalled Democratic House speaker, reached a broader fiscal deal that not only raised the nation's borrowing authority for two years but staved off automatic budget cuts that both parties deplored.

McConnell implored Trump at the time to negotiate directly with Pelosi and House Democrats, aides said — and the two parties were able to push off the prospect of a debt default beyond Trump's presidency despite political turmoil elsewhere.


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]]> https://cincylink.com/2023/05/24/biden-gop-must-decide-whats-on-the-table-for-debt-ceiling-talks/feed/ 0 Debt ceiling negotiations explained https://cincylink.com/2023/05/23/debt-ceiling-negotiations-explained/ https://cincylink.com/2023/05/23/debt-ceiling-negotiations-explained/#respond Wed, 24 May 2023 03:07:42 +0000 https://cincylink.com/?p=197646

President Joe Biden and House Speaker Kevin McCarthy met Monday after a weekend of on again, off again negotiations over raising the nation's debt ceiling and mere days before the government could reach a “hard deadline” and run out of cash to pay its bills.The two sides are working to reach a budget compromise before June 1, when Treasury Secretary Janet Yellen has said the country could default.Video above: What could happen if U.S. defaults?Speaking to reporters after Monday's meeting, McCarthy said the two sides had not yet reached an agreement but the meeting was “productive.” In his own statement following the Oval Office sit-down, Biden echoed those sentiments.“We reiterated once again that default is off the table and the only way to move forward is in good faith toward a bipartisan agreement,” Biden said. Their handpicked negotiators will continue to meet.McCarthy and Republicans are insisting on spending cuts in exchange for raising the debt limit. Biden has come to the negotiating table after balking for months but says the GOP lawmakers will have to back off their “extreme positions.”On Sunday evening, negotiators met again and appeared to be narrowing on a 2024 budget year cap that could resolve the standoff. After speaking with Biden by phone as the president traveled home from a trip to Asia, McCarthy sounded somewhat optimistic. But he warned that "there's no agreement on anything.”A look at the negotiations and why they are happening:WHAT IS THE DEBT CEILING FIGHT ALL ABOUT?Once a routine act by Congress, the vote to raise the debt ceiling allows the Treasury Department to continue borrowing money to pay the nation's already incurred bills.The vote in more recent times has been used as a political leverage point, a must-pass bill that can be loaded up with other priorities.Video below: President Biden and Speaker Kevin McCarthy comment on debt ceiling negotiations House Republicans, newly empowered in the majority this Congress, are refusing to raise the debt limit unless Biden and the Democrats impose federal spending cuts and restrictions on future spending.The Republicans say the nation's debt, now at $31 trillion, is unsustainable. They also want to attach other priorities, including stiffer work requirements on recipients of government cash aid, food stamps and the Medicaid health care program. Many Democrats oppose those requirements.Biden had insisted on approving the debt ceiling with no strings attached, saying the U.S. always pays its bills and defaulting on debt is non-negotiable.But facing a deadline as soon as June 1, when Treasury says it will run out of money, Biden launched negotiations with Republicans. IS IT CLOSE TO BEING RESOLVED?There are positive signs, though there have been rocky moments in the talks.Start-stop negotiations were back on track late Sunday, and all sides appear to be racing toward a deal. Negotiators left the Capitol after 8 p.m. Sunday and said they would keep working.McCarthy said after his call with Biden that "I think we can solve some of these problems if he understands what we're looking at."The speaker added: "We have to spend less money than we spent last year."Biden, for his part, said at a press conference in Japan before departing: "I think that we can reach an agreement."But reaching an agreement is only part of the challenge. Any deal will also have to pass the House and Senate with significant bipartisan support. Many expect that buy-in from the White House and GOP leadership will be enough to muscle it over the finish line.WHAT ARE THE HANGUPS?Republicans want to roll back spending to 2022 levels and cap future spending for the next decade.Democrats aren't willing to go that far to cut federal spending. The White House has instead proposed holding spending flat at the current 2023 levels.Video below: Here's what a debt ceiling failure could mean for youThere are also policy priorities under consideration, including steps that could help speed the construction and development of energy projects that both Republicans and some Democrats want.Democrats have strenuously objected to a Republican push to impose stiffer work requirements on people who receive government aid through food stamps, Medicaid health care and the cash assistance programs.Biden, though, has kept the door open to some discussion over work requirements.WHAT HAPPENS IF THEY DON'T RAISE THE DEBT CEILING?A government default would be unprecedented and devastating to the nation's economy. Yellen and economic experts have said it could be "catastrophic."There isn't really a blueprint for what would happen. But it would have far-reaching effects.Yellen has said it would destroy jobs and businesses and leave millions of families who rely on federal government payments to "likely go unpaid," including Social Security beneficiaries, veterans and military families. Video below: Financial research firm on what government default could meanMore than 8 million people could lose their jobs, government officials estimate. The economy could nosedive into a recession."A default could cause widespread suffering as Americans lose the income that they need to get by," she said. Disruptions to federal government operations would impact "air traffic control and law enforcement, border security and national defense, and food safety."IS THERE A BACKUP PLAN IF TALKS FAIL?Some Democrats have proposed that they could raise the debt ceiling on their own, without help from Republicans.Progressives have urged Biden to invoke a clause in the Constitution's 14th Amendment that says the validity of the public debt in the United States "shall not be questioned." Default, the argument goes, is therefore unconstitutional.Supporters of unilateral action say Biden already has the authority to effectively nullify the debt limit if Congress won't raise it, so that the validity of the country's debt isn't questioned. The president said Sunday that it's a "question that I think is unresolved," as to whether he could act alone, adding he hopes to try to get the judiciary to weigh in on the notion for the future.In Congress, meanwhile, House Democratic leader Hakeem Jeffries has launched a process that would "discharge" the issue to the House floor and force a vote on raising the debt limit.It's a cumbersome legislative procedure, but Jeffries urged House Democrats to sign on to the measure in hopes of gathering the majority needed to trigger a vote.The challenge for Democrats is that they have only 213 members on their side — five short of the 218 needed for a majority.Getting five Republicans to cross over and join the effort won't be easy. Signing onto a "discharge" petition from the minority is seen as a major affront to party leadership, particularly on an issue as important as the debt ceiling. Few Republicans, if any, may be willing to suffer the consequences.

WASHINGTON —

President Joe Biden and House Speaker Kevin McCarthy met Monday after a weekend of on again, off again negotiations over raising the nation's debt ceiling and mere days before the government could reach a “hard deadline” and run out of cash to pay its bills.

The two sides are working to reach a budget compromise before June 1, when Treasury Secretary Janet Yellen has said the country could default.

Video above: What could happen if U.S. defaults?

Speaking to reporters after Monday's meeting, McCarthy said the two sides had not yet reached an agreement but the meeting was “productive.” In his own statement following the Oval Office sit-down, Biden echoed those sentiments.

“We reiterated once again that default is off the table and the only way to move forward is in good faith toward a bipartisan agreement,” Biden said. Their handpicked negotiators will continue to meet.

McCarthy and Republicans are insisting on spending cuts in exchange for raising the debt limit. Biden has come to the negotiating table after balking for months but says the GOP lawmakers will have to back off their “extreme positions.”

On Sunday evening, negotiators met again and appeared to be narrowing on a 2024 budget year cap that could resolve the standoff. After speaking with Biden by phone as the president traveled home from a trip to Asia, McCarthy sounded somewhat optimistic. But he warned that "there's no agreement on anything.”

A look at the negotiations and why they are happening:

WHAT IS THE DEBT CEILING FIGHT ALL ABOUT?

Once a routine act by Congress, the vote to raise the debt ceiling allows the Treasury Department to continue borrowing money to pay the nation's already incurred bills.

The vote in more recent times has been used as a political leverage point, a must-pass bill that can be loaded up with other priorities.

Video below: President Biden and Speaker Kevin McCarthy comment on debt ceiling negotiations

House Republicans, newly empowered in the majority this Congress, are refusing to raise the debt limit unless Biden and the Democrats impose federal spending cuts and restrictions on future spending.

The Republicans say the nation's debt, now at $31 trillion, is unsustainable. They also want to attach other priorities, including stiffer work requirements on recipients of government cash aid, food stamps and the Medicaid health care program. Many Democrats oppose those requirements.

Biden had insisted on approving the debt ceiling with no strings attached, saying the U.S. always pays its bills and defaulting on debt is non-negotiable.

But facing a deadline as soon as June 1, when Treasury says it will run out of money, Biden launched negotiations with Republicans.

IS IT CLOSE TO BEING RESOLVED?

There are positive signs, though there have been rocky moments in the talks.

Start-stop negotiations were back on track late Sunday, and all sides appear to be racing toward a deal. Negotiators left the Capitol after 8 p.m. Sunday and said they would keep working.

McCarthy said after his call with Biden that "I think we can solve some of these problems if he understands what we're looking at."

The speaker added: "We have to spend less money than we spent last year."

Biden, for his part, said at a press conference in Japan before departing: "I think that we can reach an agreement."

But reaching an agreement is only part of the challenge. Any deal will also have to pass the House and Senate with significant bipartisan support. Many expect that buy-in from the White House and GOP leadership will be enough to muscle it over the finish line.

WHAT ARE THE HANGUPS?

Republicans want to roll back spending to 2022 levels and cap future spending for the next decade.

Democrats aren't willing to go that far to cut federal spending. The White House has instead proposed holding spending flat at the current 2023 levels.

Video below: Here's what a debt ceiling failure could mean for you

There are also policy priorities under consideration, including steps that could help speed the construction and development of energy projects that both Republicans and some Democrats want.

Democrats have strenuously objected to a Republican push to impose stiffer work requirements on people who receive government aid through food stamps, Medicaid health care and the cash assistance programs.

Biden, though, has kept the door open to some discussion over work requirements.

WHAT HAPPENS IF THEY DON'T RAISE THE DEBT CEILING?

A government default would be unprecedented and devastating to the nation's economy. Yellen and economic experts have said it could be "catastrophic."

There isn't really a blueprint for what would happen. But it would have far-reaching effects.

Yellen has said it would destroy jobs and businesses and leave millions of families who rely on federal government payments to "likely go unpaid," including Social Security beneficiaries, veterans and military families.

Video below: Financial research firm on what government default could mean

More than 8 million people could lose their jobs, government officials estimate. The economy could nosedive into a recession.

"A default could cause widespread suffering as Americans lose the income that they need to get by," she said. Disruptions to federal government operations would impact "air traffic control and law enforcement, border security and national defense, and food safety."

IS THERE A BACKUP PLAN IF TALKS FAIL?

Some Democrats have proposed that they could raise the debt ceiling on their own, without help from Republicans.

Progressives have urged Biden to invoke a clause in the Constitution's 14th Amendment that says the validity of the public debt in the United States "shall not be questioned." Default, the argument goes, is therefore unconstitutional.

Supporters of unilateral action say Biden already has the authority to effectively nullify the debt limit if Congress won't raise it, so that the validity of the country's debt isn't questioned. The president said Sunday that it's a "question that I think is unresolved," as to whether he could act alone, adding he hopes to try to get the judiciary to weigh in on the notion for the future.

In Congress, meanwhile, House Democratic leader Hakeem Jeffries has launched a process that would "discharge" the issue to the House floor and force a vote on raising the debt limit.

It's a cumbersome legislative procedure, but Jeffries urged House Democrats to sign on to the measure in hopes of gathering the majority needed to trigger a vote.

The challenge for Democrats is that they have only 213 members on their side — five short of the 218 needed for a majority.

Getting five Republicans to cross over and join the effort won't be easy. Signing onto a "discharge" petition from the minority is seen as a major affront to party leadership, particularly on an issue as important as the debt ceiling. Few Republicans, if any, may be willing to suffer the consequences.


Source link

]]> https://cincylink.com/2023/05/23/debt-ceiling-negotiations-explained/feed/ 0 McConnell says he won’t help Dems raise debt limit again https://cincylink.com/2021/10/10/mcconnell-says-he-wont-help-dems-raise-debt-limit-again/ https://cincylink.com/2021/10/10/mcconnell-says-he-wont-help-dems-raise-debt-limit-again/#respond Sun, 10 Oct 2021 04:18:17 +0000 https://cincylink.com/?p=102442

Senate Minority Leader Mitch McConnell said Friday he would not again help Democrats extend the government's borrowing authority, raising fresh doubts about how Congress will avert a federal default when a temporary patch expires in December.McConnell issued his warning in a letter to President Joe Biden a day after the Senate approved a $480 billion boost in the federal debt limit, enough to last about two months. In an eleventh-hour turnabout, the Kentucky Republican was among 11 GOP senators who provided decisive support Thursday for a procedural move that opened the door for subsequent Senate passage of that measure with only Democratic support.Some GOP senators openly criticized their leaders not holding out longer against Democrats' efforts to extend the debt limit, which they said would have sharpened their message that a still-developing multibillion-dollar package of Biden's top domestic priorities is wasteful and damaging to the economy.McConnell said Friday that he made his decision to refuse future help because of his opposition to the huge domestic bill and because of a "bizarre spectacle" on the Senate floor by Majority Leader Chuck Schumer, D-N.Y. After the bill passed, Schumer criticized Republicans for trying to push the country over "the cliff's edge" by opposing the debt limit extension."In light of Senator Schumer's hysterics and my grave concerns about the ways that another vast, reckless, partisan spending bill would hurt Americans and help China, I will not be a party to any future effort to mitigate the consequences of Democratic mismanagement," McConnell wrote.It remains unclear how Democrats would push new legislation further extending federal borrowing authority come December without GOP backing.One theoretical way is for them to change Senate rules and shield debt limit legislation from GOP filibusters, delays that require 60 votes to overcome in the 50-50 Senate.At least two Democratic senators, West Virginia's Joe Manchin and Arizona's Kyrsten Sinema, have said they oppose doing that, effectively thwarting that option. Republicans said one factor in providing Democrats the two-month lifeline was fear that Manchin and Sinema might decide to support ending filibusters for debt limit legislation.McConnell's letter included a string of insults aimed at Schumer, a remarkable broadside by one Senate leader against another."Last night, in a bizarre spectacle, Senator Schumer exploded in a rant that was so partisan, angry, and corrosive that even Democratic Senators were visibly embarrassed by him and for him," McConnell wrote. "This tantrum encapsulated and escalated a pattern of angry incompetence from Senator Schumer."McConnell added: "This childish behavior only further alienated the Republican members who helped facilitate this short-term patch. It has poisoned the well even further."A Schumer spokesperson declined to comment on McConnell's letter.Since summer, McConnell repeatedly said Republicans would not assist Democrats in pushing a debt ceiling extension through the Senate by helping them reach the 60 votes needed for most legislation. He cited Democrats' proposed 10-year, $3.5 trillion social, economic and tax measure, which Republicans unanimously oppose.Hours before Thursday's vote, McConnell reversed course and proposed a short-term extension into December. Without a renewal of federal borrowing powers, the Treasury Department had projected it would run out of cash to pay the government’s bills by Oct. 18.Republicans lambasting McConnell's tactic included former President Donald Trump, still influential within the GOP. Sen. Lindsey Graham, R-S.C., typically a McConnell ally, slammed the move as "complete capitulation."If the government depletes its legal ability to borrow money, financial analysts have warned that it could deliver a serious blow to the U.S. and global economy and cause delays in government payments to Social Security recipients and others.McConnell has insisted that Democrats can raise the debt ceiling by themselves by employing the same special budget process they're already using for their enormous domestic spending and tax measure. Those procedures forbid filibusters from being used against certain bills.Democrats say they won't use that process, which they call too cumbersome. But it would also require them to raise the debt limit by a specific dollar amount that, they fear, Republicans will make a staple of campaign ads attacking them.Democrats accused McConnell of creating a potential financial crisis. They noted that the current federal debt of around $28 trillion is to cover spending that's already been approved, including around $7 trillion under former President Donald Trump.McConnell said it was Democrats who prompted the problem because he had warned them since summer that they would have to approve the debt limit extension on their own. Before Thursday, the House had approved debt ceiling extensions but Republicans blocked them in the Senate.After the $480 billion borrowing extension cleared the procedural hurdle thanks to GOP support Thursday, the Senate gave it final approval by 50-48 with only Democratic votes. Final congressional approval of the Senate-passed short-term debt ceiling extension is expected Tuesday by the House.After the Senate vote, Schumer lauded Democrats for overcoming "this Republican-manufactured crisis. Despite immense opposition from Leader McConnell and members of his conference, our caucus held together and we have pulled our country back from the cliff’s edge that Republicans tried to push us over."

WASHINGTON —

Senate Minority Leader Mitch McConnell said Friday he would not again help Democrats extend the government's borrowing authority, raising fresh doubts about how Congress will avert a federal default when a temporary patch expires in December.

McConnell issued his warning in a letter to President Joe Biden a day after the Senate approved a $480 billion boost in the federal debt limit, enough to last about two months. In an eleventh-hour turnabout, the Kentucky Republican was among 11 GOP senators who provided decisive support Thursday for a procedural move that opened the door for subsequent Senate passage of that measure with only Democratic support.

Some GOP senators openly criticized their leaders not holding out longer against Democrats' efforts to extend the debt limit, which they said would have sharpened their message that a still-developing multibillion-dollar package of Biden's top domestic priorities is wasteful and damaging to the economy.

McConnell said Friday that he made his decision to refuse future help because of his opposition to the huge domestic bill and because of a "bizarre spectacle" on the Senate floor by Majority Leader Chuck Schumer, D-N.Y. After the bill passed, Schumer criticized Republicans for trying to push the country over "the cliff's edge" by opposing the debt limit extension.

"In light of Senator Schumer's hysterics and my grave concerns about the ways that another vast, reckless, partisan spending bill would hurt Americans and help China, I will not be a party to any future effort to mitigate the consequences of Democratic mismanagement," McConnell wrote.

It remains unclear how Democrats would push new legislation further extending federal borrowing authority come December without GOP backing.

One theoretical way is for them to change Senate rules and shield debt limit legislation from GOP filibusters, delays that require 60 votes to overcome in the 50-50 Senate.

At least two Democratic senators, West Virginia's Joe Manchin and Arizona's Kyrsten Sinema, have said they oppose doing that, effectively thwarting that option. Republicans said one factor in providing Democrats the two-month lifeline was fear that Manchin and Sinema might decide to support ending filibusters for debt limit legislation.

McConnell's letter included a string of insults aimed at Schumer, a remarkable broadside by one Senate leader against another.

"Last night, in a bizarre spectacle, Senator Schumer exploded in a rant that was so partisan, angry, and corrosive that even Democratic Senators were visibly embarrassed by him and for him," McConnell wrote. "This tantrum encapsulated and escalated a pattern of angry incompetence from Senator Schumer."

McConnell added: "This childish behavior only further alienated the Republican members who helped facilitate this short-term patch. It has poisoned the well even further."

A Schumer spokesperson declined to comment on McConnell's letter.

Since summer, McConnell repeatedly said Republicans would not assist Democrats in pushing a debt ceiling extension through the Senate by helping them reach the 60 votes needed for most legislation. He cited Democrats' proposed 10-year, $3.5 trillion social, economic and tax measure, which Republicans unanimously oppose.

Hours before Thursday's vote, McConnell reversed course and proposed a short-term extension into December. Without a renewal of federal borrowing powers, the Treasury Department had projected it would run out of cash to pay the government’s bills by Oct. 18.

Republicans lambasting McConnell's tactic included former President Donald Trump, still influential within the GOP. Sen. Lindsey Graham, R-S.C., typically a McConnell ally, slammed the move as "complete capitulation."

If the government depletes its legal ability to borrow money, financial analysts have warned that it could deliver a serious blow to the U.S. and global economy and cause delays in government payments to Social Security recipients and others.

McConnell has insisted that Democrats can raise the debt ceiling by themselves by employing the same special budget process they're already using for their enormous domestic spending and tax measure. Those procedures forbid filibusters from being used against certain bills.

Democrats say they won't use that process, which they call too cumbersome. But it would also require them to raise the debt limit by a specific dollar amount that, they fear, Republicans will make a staple of campaign ads attacking them.

Democrats accused McConnell of creating a potential financial crisis. They noted that the current federal debt of around $28 trillion is to cover spending that's already been approved, including around $7 trillion under former President Donald Trump.

McConnell said it was Democrats who prompted the problem because he had warned them since summer that they would have to approve the debt limit extension on their own. Before Thursday, the House had approved debt ceiling extensions but Republicans blocked them in the Senate.

After the $480 billion borrowing extension cleared the procedural hurdle thanks to GOP support Thursday, the Senate gave it final approval by 50-48 with only Democratic votes. Final congressional approval of the Senate-passed short-term debt ceiling extension is expected Tuesday by the House.

After the Senate vote, Schumer lauded Democrats for overcoming "this Republican-manufactured crisis. Despite immense opposition from Leader McConnell and members of his conference, our caucus held together and we have pulled our country back from the cliff’s edge that Republicans tried to push us over."


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]]> https://cincylink.com/2021/10/10/mcconnell-says-he-wont-help-dems-raise-debt-limit-again/feed/ 0 What exactly is the debt ceiling? https://cincylink.com/2021/10/02/what-exactly-is-the-debt-ceiling/ https://cincylink.com/2021/10/02/what-exactly-is-the-debt-ceiling/#respond Sat, 02 Oct 2021 04:48:12 +0000 https://cincylink.com/?p=99313

WASHINGTON, D.C. — Congress is taking action Thursday to avert a government shutdown. However, lawmakers are doing so by not addressing the debt ceiling.

Treasury Secretary Janet Yellen has said if Congress doesn't raise it by October 18, America will default on its financial obligations for the first time in history.

WHAT IS THE DEBT CEILING?

The debt ceiling is the amount of money the government can borrow to pay its bills, somewhat like your credit card limit.

Currently, the debt ceiling is $28.4 trillion, which is right around the amount of federal debt the country has accumulated.

If you are wondering if all countries have to deal with the debt ceiling, it is for the most part a uniquely American issue.

The United Kingdom, Japan, Canada, Germany, and France don't have debt ceiling votes like this.

Only two countries have debt limit rules, Denmark and Poland. However, economists say it's not really controversial in those countries.

The debt ceiling issue exists in the United States mainly because of our Constitution.

Article 1, Section 8 says “Congress shall have Power {..} to borrow Money on the credit of the United States.”

In 1917, during World War I, Congress gave the Treasury Department more flexibility to borrow money.

The first official debt limit was set at $45 billion in 1939, according to the Bipartisan Policy Center.

According to the Treasury Department's website, since 1960, Congress has acted 78 separate times to raise the debt limit.

America has never let it lapse, although lawmakers came close during the Obama presidency.

THE DEBATE

Why is the country facing a debate over the debt ceiling? In short, because of disagreements between Republicans and Democrats.

Sen. Chuck Schumer (D-N.Y.) leads Democrats in the U.S. Senate.

He said on the floor this week about the possibility of default, "Time is short. The danger is real."

The reason the country is facing a possibility of default is Schumer wants Republicans to pass a debt limit increase in a bipartisan fashion.

However, Sen. Mitch McConnell (R-K.Y.) has made it clear Republicans aren't interested in raising the debt ceiling while Democrats are in charge and are proposing trillions of dollars in new spending.

"Our Democratic colleagues will have to do it alone," McConnell said this week.

Democrats are capable of raising the debt limit through the reconciliation process, but that has been rejected over concerns it would procedurally take too long.

As a result, everything from social security checks to military pay hangs in the balance.




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