US President Biden continues to negotiate with the Republicans to avoid a default in the world’s largest economy. The White House reports “steady progress”.
The White House sees “steady progress” in the tough negotiations on raising the debt ceiling in the United States.
The US government headquarters announced that President Joe Biden had been informed about the status of the negotiations by his team in Washington in a booth in Hiroshima, Japan. Biden is attending the summit of the seven leading democratic industrialized nations in Japan.
The team told the President that “steady progress” was being made, the White House said. Biden remains confident that Congress will take the necessary precautions to avoid a US government default.
Because of the budget crisis at home, Biden’s participation in the G7 summit in Japan was temporarily on the brink. He eventually canceled the second part of his trip abroad – a visit to Papua New Guinea and Australia – to return to Washington immediately after the Hiroshima deliberations.
Bitter partisan wrangling
The background to this is that the US government is threatened with default at the beginning of June if Biden’s team does not reach an agreement with the Republicans in Congress on raising the debt ceiling by then. In the USA, parliament sets such a limit at irregular intervals and determines how much money the state can borrow.
This time, the procedure has degenerated into bitter partisan wrangling that is dangerous for the US and beyond: A default by the world’s largest economy could trigger a global financial crisis and an economic downturn. The argument has been going on for months.
A senior US official complained in Hiroshima on Thursday that Republican behavior on the issue was undermining America’s leadership role in the world and America’s trustworthiness for international partners. It also undermines the central role of the US financial system in the global economy if the US government’s creditworthiness is questioned.
After that, Biden’s opponent in the negotiations, the Republican chairman of the House of Representatives, Kevin McCarthy, was optimistic about an early agreement. “We’re not there yet. (…) But I can see the way,” he said.
Source: Stern
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