White House Firm on "Debt Negotiations Impossible"... "4 Weeks of Cruel Fate"

Despite warnings that the United States could default on its debt as early as next month on the 1st, the White House has reiterated that it has no plans to accept the Republican demand for government spending cuts in exchange for raising the debt ceiling. The political standoff between the ruling and opposition parties over the debt ceiling is turning into a brutal four-week battle that will determine the fate of the U.S. economy.

On the 2nd (local time), according to U.S. political media outlet Politico and others, White House Press Secretary Karine Jean-Pierre mentioned at a briefing the upcoming meeting scheduled for the 9th between President Biden and congressional leaders from both parties at the White House, stating, "President Biden will not negotiate on the debt ceiling issue."

This statement came after the Treasury Department indicated that the default deadline would be in four weeks, and despite President Biden inviting congressional leaders to the White House, he firmly stated again that the debt ceiling issue is not up for negotiation.

She also emphasized that the debt ceiling was raised unconditionally three times during the administration of former President Donald Trump, a Republican. President Biden and the Democrats stress that the debt ceiling has historically been raised without conditions under previous administrations and argue that Republicans must unconditionally agree to raise it to avoid an economic disaster in the U.S. and worldwide.

On the previous day, Treasury Secretary Janet Yellen sent a letter to congressional leaders, including House Speaker Kevin McCarthy, a Republican, warning that "it will be difficult to meet all government payments by June 1," moving up the predicted default risk date earlier than previously expected.

The Republican-controlled House of Representatives passed a bill on May 26 linking the debt ceiling increase to government spending cuts with a vote of 217 in favor and 215 against. The bill is unlikely to pass in the Democrat-majority Senate, and President Biden has also indicated he would veto the bill if it passes Congress.

In response, President Biden criticized the move as an "irresponsible hostage threat holding the U.S. economy hostage" and demanded its withdrawal.

The U.S. government’s debt ceiling stands at $31.4 trillion (approximately 42,107 trillion won). Since January, when the debt approached the limit, the U.S. has taken measures to prevent economic damage.

AP News reported, "The meeting between President Biden and congressional leaders is the first step toward negotiations to avoid an economic disaster, but there is still a long way to go," adding, "The meeting suggests that bipartisan leaders understand the current risks, but it is more than just a meeting."

Accordingly, the general consensus is that President Biden and the Republicans are likely to remain at an impasse during the meeting on the 9th, and their positions will not be resolved immediately.

[Image source=UPI Yonhap News]

However, Press Secretary Jean-Pierre said that during this meeting, "there will be a separate conversation about spending," indicating that discussions about starting a separate budget process will take place. This reaffirmed the existing stance that the debt ceiling will be raised unconditionally as per precedent, while government spending adjustments, which Republicans are concerned about, should be discussed separately.

If the two parties ultimately fail to reach an agreement, the possibility of the U.S. government falling into a default situation cannot be ruled out. Previously, in 2011, during the Obama administration, a standoff over the debt ceiling led to a downgrade of the U.S. national credit rating by one notch, sending shockwaves through the global economy.

The Wall Street Journal (WSJ) highlighted that the debt ceiling debate is occurring at a time when the U.S. economy is vulnerable due to high-intensity austerity measures. Experts predict that if the debt ceiling is not raised, millions of job losses, corporate bankruptcies, and financial market turmoil could cause significant pain to the U.S. economy, which could also have adverse effects on the global economy.

This content was produced with the assistance of AI translation services.