Joe Biden: Following a warning from the Treasury that the government might not have enough money to pay its bills by June, US President Joe Biden on Monday invited the four top congressional leaders to the White House the following week. In a letter to Congress, Treasury Secretary Janet Yellen warned that without congressional intervention, the agency may not be able to make all US government payment obligations as early as June 1.
Biden called Republican House Speaker Kevin McCarthy in Jerusalem
The estimate increased the possibility that the United States is on the verge of a historic default that would rock the world economy, giving political calculations in Washington—where Democrats and Republicans were bracing for a protracted standoff—new urgency. In order to invite him to a meeting on May 9 at the White House, Biden called Republican House Speaker Kevin McCarthy in Jerusalem, where he is on a diplomatic mission. Since February, the two presidents haven’t had a meeting to talk about the problem. Yellen previously assured Congress that Treasury would use exceptional financial management techniques to maintain debt payments, federal benefit payments, and other spending after reaching the $31.4 trillion borrowing maximum on January 19.
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House passed a bill to raise the debt
Last week, the House passed a bill to raise the debt ceiling that includes significant cuts to spending on everything from healthcare for the poor to air traffic controllers. Biden and the Democratic-controlled Senate say they will not support this measure. On May 9, according to a White House representative, Biden will “emphasise that Congress must take action to avert default without conditions,” contrary to his earlier statement that he wouldn’t meet McCarthy at all to address the debt ceiling. A comparable debt ceiling battle in 2011 brought the nation dangerously close to default and resulted in the downgrading of the nation’s excellent credit rating. Negotiations may be considerably more challenging this time, according to veterans of the 2011 conflict. Suspending the sales of securities used by state and local governments to temporarily store funds is one of the actions Treasury is taking.
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