President Joe Biden, House Speaker Kevin McCarthy and other congressional leaders are planning to meet Tuesday to discuss budget negotiations to avoid a default.
Biden told reporters Sunday in Delaware that he expects to meet McCarthy on Tuesday, just a day before leaving for a Group of Seven summit in Japan. A person familiar with discussions confirmed that the meeting is expected then but cautioned that plans could change.
The president and the Republican speaker have been locked in a standoff for months over raising the government’s $31.4 trillion borrowing limit. A US default risks triggering a market selloff, a spike in borrowing costs and a blow to the global economy that could rival the 2008 crash.
Biden, who announced his reelection campaign late last month, was tight-lipped about terms of the negotiation but said he believed a deal could be reached.
“I remain optimistic because I’m a congenital optimist. But I really think there’s a desire on their part as well as ours to reach an agreement and I think we’ll be able to do it,” he told reporters Sunday in Rehoboth Beach, Delaware.
When asked about if he would support tougher work requirements as part of a deal, he said he’s supported some in the past. “For Medicaid, it’s a different story and so I’m waiting to hear what their exact proposal is,” he said, declining to elaborate.
The leaders were due to meet Friday but postponed it as staff level talks continued throughout the weekend.
Biden is due to leave Wednesday for a foreign trip that includes the G7 and Quad summits. He said Sunday he still plans to go.
Treasury Secretary Janet Yellen has warned that the US risks a catastrophic default as soon as June 1 if the debt limit isn’t suspended or raised. She hasn’t spelled out what exactly the Treasury department would do if Congress fails to raise or suspend the debt ceiling in time.
McCarthy has said any change to the limit is contingent on a budget deal; Biden has criticized Republicans for risking a default for leverage in talks.
For Biden, risks of a historic default add to factors that may affect his reelection hopes, as he already contends with persistent inflation, a regional banking crisis and a possible recession.
(Updates with details in paragraph 2, 3, 4, 9, and 11; Adds links and video)