fierce negotiations to avoid default

by time news

2023-05-27 17:52:17

The date on which the US Treasury will find itself unable to honor its financial commitments is now set for June 5.

Democrats and Republicans seemed close to an agreement on Saturday to avoid a default by the United States before the new deadline of June 5, but the negotiations still stumble on final points. On Friday evening, US President Joe Biden showed up “optimisticabout the prospects for a deal with the Republican opposition, noting that negotiators on both sides were “very close” to conclude.

Discussions continued on Saturday and progressed, but negotiators are stumbling over final details of the agreement that everyone considers to be red lines. Asked Saturday morning if there would be a deal before the deadline, Republican House Leader Kevin McCarthy replied: “oui». «I think we can really do it“, he told reporters while warning that there remained sticking points.

The United States, which entered the long weekend of the “Memorial Day», the day of the veterans Monday, remain suspended with an agreement to raise the ceiling of the debt, essential to avoid the default of payment which would have catastrophic consequences for the world economy. The date on which the US Treasury will find itself unable to honor its financial commitments is now set for June 5, against June 1 previously, offering a few days of respite to the country.

Red lines

Among the points of disagreement between the two camps is the requirement of the Republicans to condition certain social benefits. “I don’t think it’s good to borrow money from China to pay healthy people with no dependents to lay on their couch“, castigated Mr. McCarthy, who poses as an uncompromising defender of budgetary discipline, in a video shared on Saturday.

White House spokesman Andrew Bates criticized Republicans for wanting to hold the economy hostage and jeopardize “more than eight million jobs“while wanting”take bread out of the mouths of hungry Americans“. Joe Biden, campaigning for his re-election, positions himself as a champion of social and fiscal justice and has repeatedly said he is opposed to massive budget cuts which would impact the most precarious workers and households.

One of the Republican negotiators Patrick McHenry spoke of a “short list of disagreementsremaining between the two camps. “It’s a matter of hours or days“, he said on Saturday. The pressure surrounding the negotiations is all the stronger as the compromise, once obtained, will have to be validated by the Senate and the House of Representatives. However, many elected officials returned to their strongholds for a few days on the occasion of the holiday weekend of “Memorial Dayand could be urgently called back to Washington.

Also looms the threat of seeing the agreement shunned in Congress, elected progressives from the Democratic Party, like some elected from the Republican Party, having threatened not to ratify or to delay as much as possible a text that would make too many concessions to the opposing camp. On Friday, IMF Managing Director Kristalina Georgieva said a deal was “primordialfor the global economy, while emphasizing that the United States must do “more to reduce public debt».

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