House Speaker Kevin McCarthy (R-Calif.) declared on May 25 that he will stay in Washington, D.C. “for as long as it takes” in an effort to come to an agreement on the debt ceiling that’s “worthy of the American people.”
McCarthy took to Twitter amid the ongoing political deadlock where he penned, “I’m staying in DC to fight for an agreement that’s worthy of the American people—for as long as it takes.”
“I will continue the fight to curb inflation, stop reckless spending, make our economy stronger, and end our dependence on China,” McCarthy added.
Speaking to reporters earlier on Thursday afternoon, McCarthy stressed that he is “not going to give up” on the American public amid his ongoing budget deal negotiations with President Joe Biden, despite the looming June deadline.
The Republican sought to ease concerns that the United States might default on its debt obligations for the first time in history, which could have disastrous economic effects both domestically and abroad.
Negotiations between Democrats and Republicans over the nation’s debt ceiling, now at $31 trillion, are already in their third week. The administration has refused to make spending cuts until the debt limit is raised.
Biden has put forward a proposal that he says will cut spending by more than $1 trillion and freeze spending for the next two years. Republicans say that’s not enough.
McCarthy’s comments came shortly after Biden left the Capitol.
‘We’re Going to Solve This Problem’
“We’re not going to default, we’re going to solve this problem, I will stay with it until we can get it done,” McCarthy said. “But let’s be honest about this, we have to spend less than we did last year. It is not my fault that the Democrats can not give up on their spending.”
McCarthy’s comments come as Treasury Secretary Janet Yellen has warned that the government could run out of cash to pay its bills by next week.
According to the Daily Treasury Statement, the Treasury’s opening cash balance on May 24, the latest data available, was $76,546 billion, down significantly from its opening balance of $316,381 billion at the beginning of the month.
As negotiations continue, the stock market is already reacting negatively.
Late Thursday, Fitch Ratings agency—one of the three big credit rating agencies—placed the United States’ AAA credit on “ratings watch negative,” citing concerns over a possible downgrade because of the ongoing deadlock in negotiations.
The agency said it still expects a resolution to the U.S. Treasury’s debt limit before the deadline, noting that the rating watch negative reflects “increased political partisanship that is hindering reaching a resolution to raise or suspend the debt limit despite the fast-approaching x date (when the U.S. Treasury exhausts its cash position and capacity for extraordinary measures without incurring new debt).”
“However, we believe risks have risen that the debt limit will not be raised or suspended before the x-date and consequently that the government could begin to miss payments on some of its obligations,” it said.
“The brinkmanship over the debt ceiling, failure of the U.S. authorities to meaningfully tackle medium-term fiscal challenges that will lead to rising budget deficits and a growing debt burden signal downside risks to U.S. creditworthiness,” the agency said.
‘Competing Visions for America’
Speaking at the White House on Thursday, Biden declared: “The only way to move forward is with a bipartisan agreement. And I believe we’ll come to an agreement that allows us to move forward and protects the hardworking Americans of this country.”
The president also stressed that the United States would not default, something he said congressional leaders are all in agreement with.
“Now, I want to be clear that the negotiations we’re having with Speaker McCarthy is about the outlines of what the budget will look like, not about default,” he continued. “It’s about competing visions for America.”
Lawmakers are not expected to return to work until May 30, just days before the United States is expected to start running out of cash.
Biden will also be away this weekend, leaving Friday for the presidential retreat at Camp David, Maryland, before heading to his home in Wilmington, Delaware.
While Biden has ruled out invoking the 14th Amendment, allowing him to act unilaterally to raise the debt limit on his own if Congress doesn’t act, Democrats in the House have all signed on to a legislative “discharge” process that would force a debt ceiling vote.
However, they will need five Republicans to break with their party and sign the petition for the plan to move forward.
The Associated Press contributed to this report.