Debt limit talks start, stop as US Republicans and White House face ‘serious differences’

Biden’s administration is reaching for a deal with Republicans led by House Speaker Kevin McCarthy

The sides are up against a deadline as soon as June 1 to raise its borrowing limit, now at US$31 trillion

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The US Capitol Building and Washington Monument in Washington, US, where debt limit talks were continuing on Saturday. Photo: EPA-EFE

Published: 1:59am, 21 May 2023Updated: 6:56am, 21 May 2023

Debt limit talks between the White House and House Republicans stopped, started and stopped again heading into a weekend where US President Joe Biden and world leaders watched from afar, hoping high-stakes negotiations would make progress on avoiding a potentially catastrophic federal default.

In a sign of a renewed bargaining session, food was brought to the negotiating room at the Capitol on Saturday morning, only to be carted away hours later. No meeting was likely on Saturday, according to a person familiar with the state of the talks who was not authorised to publicly discuss the situation and spoke on condition of anonymity.

Biden’s administration is reaching for a deal with Republicans led by House Speaker Kevin McCarthy. The sides are up against a deadline as soon as June 1 to raise its borrowing limit, now at US$31 trillion, so the government can keep paying the nation’s bills. Republicans are demanding steep spending cuts the Democrats oppose.

US President Joe Biden at a Quad leaders’ meeting in Japan on Saturday, on the sidelines of the G7 summit in Hiroshima. Photo: Pool Photo via AP

Negotiations had came to an abrupt standstill on Friday morning when McCarthy said it was time to “pause” talks. Then the teams convened again in the evening, only to quickly call it quits for the night. McCarthy on Saturday said the White House has moved backward in negotiations.

Biden, attending a meeting of global leaders in Japan, tried to reassure them on Saturday that the United States would not default, a scenario that would rattle the world economy. He said he felt there was headway in the talks.

“The first meetings weren’t all that progressive, the second ones were, the third one was,” he said.

“I don’t think we’re going to be able to move forward until the president can get back into the country,” McCarthy told reporters at the Capitol on Saturday. “Just from the last day to today they’ve moved backwards. They actually want to spend more money than we spend this year.”

Negotiators for McCarthy said after the Friday evening session that they were uncertain on next steps.