Democrats and Republicans have been at odds over the US budget for weeks; Biden therefore already shortened a trip abroad. And after a brief ray of hope, it’s probably going to take a step back.
The tough negotiations on raising the debt ceiling in the USA have been temporarily interrupted after encouraging signals. Republican negotiators left talks just about an hour after they began on Friday, US media reported. In the evening, the parties returned to the negotiating table.
House Republican negotiator Garret Graves told reporters that President Joe Biden’s Democrats were being “unreasonable” and that talks were on hold.
Time is of the essence: At the beginning of June, the US government is threatened with a default 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.
Danger of a global financial crisis
This time, this process turned into bitter partisan wrangling. This is dangerous for the USA and far beyond: A default by the world’s largest economy could trigger a global financial crisis and an economic downturn.
The Republican majority leader in the House of Representatives, Kevin McCarthy, was still optimistic on Thursday and said he could see the way to an agreement. After the interruption on Friday, however, he said there was no movement from the White House.
The Biden side had also previously spoken of progress. The financial service Bloomberg reported, citing negotiating circles, that there were no specific thematic points where there was a problem – rather the broad cuts demands of the Republicans were the sticking point. McCarthy said the US would have to spend less money than last year.
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.
Source: Stern
I have been working in the news industry for over 6 years, first as a reporter and now as an editor. I have covered politics extensively, and my work has appeared in major newspapers and online news outlets around the world. In addition to my writing, I also contribute regularly to 24 Hours World.
