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.

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.

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.

President Joe Biden and congressional leaders will likely resume talks on Tuesday at the White House over the debt limit, the president said Sunday, as the nation continues to edge closer to its legal borrowing authority with no agreement in sight.The meeting was initially supposed to be Friday, but was abruptly postponed so staff-level talks could continue before Biden and the four congressional leaders huddled for a second time. Administration and congressional officials said Sunday that a meeting has not been finalized, although Tuesday was the likeliest option as Biden returns to Washington on Monday and is scheduled to leave for the Group of 7 summit in Japan on Wednesday.Biden did not detail much progress in the talks, but said he remained hopeful that an agreement could be reached with Republicans to avoid what would be an unprecedented debt default, which could trigger a financial catastrophe."I remain optimistic because I'm a congenital optimist," Biden told reporters while out for a bike ride in Rehoboth Beach, Delaware. "But I really think there's a desire on their part as well as ours to reach an agreement. I think we'll be able to do it."Video above: Pausing a bike ride to talk to reporters, President Joe Biden said he remains optimistic on getting debt ceiling settledAides said talks had continued throughout the weekend. But at least publicly, there was little indication that either the White House or House Republicans had budged from their initial positions. Biden has called on lawmakers to lift the debt limit without preconditions, warning that the nation's borrowing authority should not be used to impose deep spending cuts and other conservative policy demands."We've not reached the crunch point yet," Biden told reporters Saturday before flying to his beach home for the weekend. "There's real discussion about some changes we all could make. We're not there yet."On Sunday, senior administration officials said the talks among staff had so far been productive after Biden and the leaders — House Speaker Kevin McCarthy, R-Calif., House Democratic leader Hakeem Jeffries of New York, Senate Majority Leader Chuck Schumer of New York and Senate Republican leader Mitch McConnell of Kentucky — ended their first meeting last Tuesday without a breakthrough.Video below: Here are some possible impacts if the U.S. defaults on its debtThe president described that Oval Office session as "productive" even though McCarthy said later he "didn't see any new movement" toward resolving the stalemate. White House and congressional aides have been in talks since Wednesday."The staff is very engaged. I would characterize the engagement as serious, as constructive," Lael Brainard, head of the White House's National Economic Council, said on CBS' "Face the Nation."McCarthy has insisted on using the threat of defaulting on the nation's debts to wrangle spending changes, arguing that the federal government can't continue to spend money at the pace it is now. The national debt now stands at $31.4 trillion.An increase in the debt limit would not authorize new federal spending. It would only allow for borrowing to pay for what Congress has already approved.The Treasury Department has said the government could exhaust the ability to pay its bills as early as June 1. The nonpartisan Congressional Budget Office gave a similar warning Friday, saying there was a "significant risk" of default sometime in the first two weeks of next month.But federal estimates still remain in flux.Video below: Treasury Secretary Janet Yellen warns of "economic calamity" if debt ceiling impasse is unresolved The CBO noted Friday that if the cash flow at the Treasury and the "extraordinary measures" that the department is now using can continue to pay for bills through June 15, the government can probably finance its operations through the end of July. That's because the expected tax revenues that will come in mid-June and other measures will give the federal government enough cash for at least a few more weeks."Ultimately the stakes are, the United States has never defaulted on its debt," Wally Adeyemo, the deputy treasury secretary, said on CNN's "State of the Union" on Sunday. "And we can't."And Rep. Michael McCaul, R-Texas, told ABC's "This Week": "I think defaulting is not the right path to go down. So I am an eternal optimist.''He added, "this is always a game we play, every Congress, you know, in daring each other to jump off the cliff. It's a dangerous game."