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Even if Biden offers Republicans a short-term solution to raise the debt ceiling, McCarthy says he’ll reject it: ‘Let’s just get this done now’

Speaker Kevin McCarthySpeaker of the House Kevin McCarthy (R-CA).

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  • Kevin McCarthy is meeting with Biden on Tuesday to discuss a debt ceiling solution.
  • Ahead of the meeting, McCarthy told NBC he will not accept a short-term debt ceiling increase.
  • The US could default on its debt as early as June 1, and Congress has yet to agree on a solution.

Speaker of the House Kevin McCarthy is dropping hints as to what he might accept — and reject — in a potential debt ceiling agreement with the president.

On Tuesday, McCarthy — along with Senate Majority Leader Chuck Schumer, Senate Minority Leader Mitch McConnell, and House Minority Leader Hakeem Jeffries — are meeting with President Joe Biden to discuss the ongoing debt ceiling crisis. Treasury Secretary Janet Yellen warned McCarthy last week that the US could default as early as June 1 if Congress does not raise the debt ceiling by then, but to date, neither party has been able to agree on an approach that would avoid that outcome.

McCarthy passed a bill in the House two weeks ago to raise the debt ceiling by $1.5 trillion, or through March 2024, whichever happens first, accompanied by over $4.5 trillion in spending cuts. Biden vowed to veto that legislation and has remained adamant that raising the debt ceiling should be a bipartisan and clean increase, without any spending cuts attached, and he has left the door open for budget negotiations — separate from a debt ceiling deal. 

But McCarthy told NBC News on Tuesday that he is unwilling to accept even a short-term debt ceiling increase ahead of budget negotiations.

“Let’s just get this done now,” he said.

“He’s got to stop ignoring problems,” McCarthy added, referring to Biden. “And why kick the can down the road? Let’s solve it now.”

The country is continuing to inch closer to an economically catastrophic — and unprecedented — default. The Bipartisan Policy Center released its latest default estimate on Tuesday, saying that it could arrive as soon as early June. According to the center, taxpayers in states that experienced natural disasters like Alabama and Georgia received an extended filing deadline, and those delays could move the default date up because of a lower cash flow to the IRS.

“The coming weeks are critical for assessing the strength of government cash flows,” Shai Akabas, BPC director of economic policy, said in a statement. “If a solution is not reached before June, policymakers may be playing daily Russian Roulette with the full faith and credit of the United States, risking financial disaster for their constituents and the country. Even now, the looming deadline is raising costs to the government, and therefore to all taxpayers.”  

It’s unclear if Tuesday’s meeting will result in an agreement, but if not, Insider has previously reported on other options on the table to avert an economic crisis without involving Congress. Those include minting a $1 trillion platinum coin or invoking a clause in the 14th amendment that would declare the debt ceiling unconstitutional, but the Biden administration has been critical of going those routes. 

“The President has been really clear Congress must do everything they can to prevent a default,” White House Press Secretary Karine Jean-Pierre said during a Monday press briefing when asked if Biden would consider the 14th amendment. “They must do their job.  That is the President’s position.  And that’s what it’s going to continue to be.”

Read the original article on Business Insider