McCarthy tries to drag Biden to negotiating table on debt limit

Speaker Kevin McCarthy (R-Calif.) is trying to ramp up pressure on President Biden to negotiate a package of fiscal reforms in exchange for raising the debt limit, but Democrats still refuse to sit down with him, setting the stage for a high-stakes standoff this summer.  

McCarthy on Tuesday tried to kickstart negotiations by laying out his first broad proposals for spending reforms in a letter to Biden.  

He called for cutting nondefense discretionary spending, reclaiming unspent COVID-19 relief funding, strengthening work requirements for social safety net programs and creating policies to lower energy costs and secure the U.S.-Mexico border to stem the flow of illegal drugs. 

McCarthy accused the president of putting the economy at risk by refusing to address the nation’s $31 trillion debt.  

“I am incredibly concerned that you are putting an already fragile economy in jeopardy by insisting upon your extreme position of refusing to negotiate any meaningful changes to out-of-control government spending alongside an increase of the debt limit,” he wrote.   

Speaker of the House Kevin McCarthy, R-Calif., has called for addressing the nation’s $31 trillion dollar debt alongside an increase in the debt limit. (AP Photo/J. Scott Applewhite)

But McCarthy also admitted Tuesday that he is growing pessimistic about reaching any deal with the White House, which has steadfastly ignored his calls for spending cuts and instead rolled out a budget proposal this month that called for nearly $5 trillion in tax increases.  

“I am more concerned than I have ever been to be able to get this debt ceiling done because he refuses to meet with anybody and misleads the American public,” McCarthy said of Biden in an interview with MSNBC on Tuesday. 

Democrats, meanwhile, say they won’t negotiate with McCarthy until he shows he has the votes to pass a package of fiscal reforms with top-line spending numbers.  

Senate Majority Leader Chuck Schumer (D-N.Y.) on Tuesday dismissed McCarthy’s letter as not doing anything to advance the discussion and said it showed the Speaker is feeling pressure to show conservatives in the House that he’s getting somewhere with the president.  

“I think he’s really feeling pressure, but he has no solution. So he keeps saying the same thing, ‘sit down and negotiate.’ But as I said, if you sit down and negotiate, we have a plan, he doesn’t. What are they going to do? Talk about the weather?” Schumer said, also calling McCarthy’s broad suggestions “vague” and “amorphous.”  

“No, he didn’t advance the ball. It was just another sign of the pressure he’s under but he’s not moving forward,” he added.  

Majority Leader Charles Schumer (D-N.Y.) addresses reporters following the weekly policy luncheon on Wednesday, March 22, 2023.

Biden on Tuesday evening responded to McCarthy’s letter, asking him to submit a budget plan before Congress leaves for a two-week recess on Thursday “so that we can have an in-depth conversation when you return.”

But he added, “As I have repeatedly said, that conversation must be separate from prompt action on the Congress’ basic obligation to pay the Nation’s bills and avoid economic catastrophe.”

Rep. Patrick McHenry (R-N.C.), one of McCarthy’s closest friends in the House, told Punchbowl Tuesday that the Speaker is losing hope of getting anywhere with Biden. 

“I’ve never seen him more pessimistic about an issue than he is about the debt ceiling increase,” he said. “At the moment, I don’t see how we get there. And this a marked change from where I’ve been.” 

McHenry said he didn’t “even see a path” to a debt ceiling agreement.  

There’s a growing expectation among senators in both parties that Biden and McCarthy won’t be able to come to any debt limit agreement, and that Senate Minority Leader Mitch McConnell (R-Ky.) will step in later this year to cut a deal to avoid a national default, as he has done in the past.  

Republican lawmakers say McCarthy needed to do something to get the stalled talks moving. He and Biden last met at the White House on Feb. 1.  

“I think it’s a good move. Let’s get people back to the table again, and hopefully this will act as a jumpstart,” Senate Republican Whip John Thune (S.D.) said.  

Sen. John Thune (R-S.D.) addresses reporters after the weekly policy luncheon on Wednesday, March 22, 2023. (Greg Nash)

Members discussed McCarthy’s letter during a House GOP conference meeting on Tuesday morning, and Republicans across the ideological spectrum expressed approval of McCarthy’s outline — including members of the House Freedom Caucus and allied hard-line members. 

“I extend my gratitude to Mr. McCarthy, Speaker McCarthy,” said Rep. Andy Biggs (R-Ariz.), a former chairman of the House Freedom Caucus. “His letter to President Biden this morning is a positive move.” 

“The conference is united. Speaker McCarthy in this conference is largely saying the same thing, talking about cutting 3 to 4 trillion dollars in spending, going back to 2019 nondefense discretionary spending, ’20 to ’22 spending overall,” said Rep. Bob Good (R-Va.).  

Republicans also derided the White House for seeming to attempt to run out the clock by refusing to sit down with McCarthy. That would then put pressure on Republicans to agree to a clean debt ceiling increase over the summer, possibly only days away from a default.   

“I also don’t know why the President feels that it’s important to wait. That seems like a delay tactic,” said Rep. Dusty Johnson (R-S.D.), chairman of the Main Street Caucus.  

 Schumer says Democrats have a plan: to vote and pass a clean bill to raise the debt limit.  

And Democrats point out that Biden submitted his $6.8 trillion budget plan to Congress on March 9.  

Republicans across the ideological spectrum, including Rep. Bob Good, have expressed approval of House Speaker Kevin McCarthy’s letter. (Annabelle Gordon)

 Schumer also criticized McCarthy for calling for trillions of dollars in spending reforms without laying out in more detail how he would achieve those savings.  

“Today he said, ‘What about $4 trillion in cuts?’ Well, what are they? A number is not a plan, especially a plan that is so vague and amorphous,” he told reporters. “The reason he doesn’t want to do it in my humble judgment is that he can’t get 218 votes for any plan.”  

But McCarthy argued Schumer does not yet having the votes to pass a clean debt ceiling increase — necessitating the need for negotiation with Biden. 

“If they think they can just raise the debt limit, why don’t they do it in the Senate tomorrow?” McCarthy said. 

White House press secretary Karine Jean-Pierre noted in a statement Tuesday that Republicans agreed to pass clean debt limit increases three times under former President Trump.  

“Business leaders and economists have warned that the threat of a default risks the livelihoods of American small businesses, retirees, and working families and would hand a massive win to China — and recent events underscore the need for Congress to address the debt limit as soon as possible. It’s time for Republicans to stop playing games, pass a clean debt ceiling bill, and quit threatening our economic recovery,” she said.  

Thune, who is standing in for McConnell while the Kentucky lawmaker recuperates from a concussion, said McCarthy didn’t coordinate his letter ahead of time with Senate Republicans but said his proposals will attract broad GOP support.  

“I know that he’s working with his members … I think those are all items that there’d probably be general, pretty broad agreement among Republicans in both the House and Senate on,” he said.