2023-05-28 08:27:38
The Democratic president finally reached an agreement in principle with Republican Kevin McCarthy, Speaker of the House, in order to avoid a default on payment by the United States.
A few days before the deadline, US President Joe Biden and Republican leader Kevin McCarthy found a “agreement in principleto avoid a default of payment by the United States, which will however still have to be validated by Congress. The House of Representatives, with a Republican majority, will vote on Wednesday, its boss said. Next will come the Senate, with a Democratic majority.
Kevin McCarthy estimated in a short speech that the budgetary compromise found, of which he did not give the details, was “quite worthy of the american people“. The Conservative leader only welcomed the “historical reductionsof the public expenditure that the agreement provides according to him, which was the main demand of the Republicans.
«This deal is a compromise, which means not everyone gets what they want“, reacted for his part Joe Biden, ensuring that the text”reduces spending while protecting essential public programs“. The Democratic president said the deal with the Conservatives was “good news, because it avoids what would have been a catastrophic (payment) default».
Read alsoCaught up by domestic politics, Joe Biden cuts short his tour in Asia
A two-year agreement
Kevin McCarthy has indicated that he will meet again on Sunday with Joe Biden and will publish the text the same day, the result of difficult negotiations. According to several American media, the agreement reached between the executive and the opposition raises for two years, so until after the presidential election of 2024, the public debt ceiling of the United States.
Without raising this limit, the first world power risked being in default of payment on June 5, unable to honor its financial commitments: salaries, pensions or reimbursements to its creditors. Like almost all major economies, the United States lives on credit. But unlike other developed countries, America regularly comes up against a legal constraint: the debt ceiling, the maximum amount of indebtedness of the United States, which must be formally raised by Congress.
From this routine legislative procedure, the Republicans, in the majority in the House of Representatives since January, have made an instrument of political pressure. Refusing to make ablank checkto the Democratic President, they have conditioned any increase in this ceiling, currently set at 31.4 trillion dollars, on budget cuts. Joe Biden, a candidate for his re-election, has long refused to come to the negotiating table, accusing the opposition of taking the American economy by “hostageby demanding such cuts.
Congressional vote not yet assured
After several meetings at the White House between the two men, the teams of the president and the “speakerRepublican finally got down to endless negotiating sessions – all profusely commented on by the whole of Washington. The agreement in principle found on Saturday evening gives a little air to the financial markets, which have never really panicked but that this paralysis was starting to get impatient. It is in fact very common for last-minute compromises to be reached on this type of file.
#Biden #welcomes #compromise #Republicans #avoid #catastrophic #default