(Washington) It has now become a tradition in the United States: Democrats and Republicans are again trying to find common ground on the debt ceiling, an endless debate that has often resulted in the partial paralysis of the US government.
But with Republicans in control of the House of Representatives and a handful of Donald Trump cronies now wielding plenty of sway over incoming House Speaker Kevin McCarthy, some fear common sense won’t prevail this time- this.
And on Thursday, the money – the full $31.4 trillion – will run out.
“It is therefore essential that Congress act in a timely manner to raise or suspend the debt ceiling,” Treasury Secretary Janet Yellen wrote last week in a letter to congressional leaders.
“Failure to meet government obligations would cause irreparable harm to the U.S. economy, the livelihoods of all Americans, and global financial stability. »
Mme Yellen made it clear in that letter that the Treasury still had a few measures up its sleeve — “extraordinary measures” to restrict investments in various civil servants’ pension funds, primarily — that would bring the government around early June. And Kevin McCarthy gives the impression of a man ready to use all the time at his disposal.
“We are six months, approximately [de l’échéance] “, argued Mr. McCarthy on Tuesday, ten days after a difficult vote to become Speaker of the House. It took 15 ballots for him to be elected, which forced him to acquiesce to the demands of some members of the far-right caucus.
“I would like to sit down with all the leaders, and especially the president, and start having discussions. »
Republicans are constantly trying to portray President Joe Biden as a spendthrift Democrat, and they intend to use their newfound leverage to wrest spending cuts from the White House, especially on benefit programs like Health Care and Social Security.
But there’s more at stake, White House press secretary Karine Jean-Pierre said on Tuesday. She went on to list a long list of areas that could be cut, including border security, food security, drug enforcement efforts and school lunch programs.
Democrats are resisting, saying a debt limit debate would be tantamount to playing with fire. Failure to pay, they warn, would set the house on fire, trigger a severe recession and lead to job losses in the country and chaos in markets around the world.
“Congress needs to act and do it quickly. There is no excuse for tight-rope politics when American jobs and economic security are at stake,” Ms.me Jean Pierre.
For his part, President McCarthy says he only wants to develop a plan to reduce the debt, balance the budget and put an end to what he considers to be excessive spending in connection with the COVID-19 pandemic.
When Democrats had a majority in both houses of the Capitol for the past four years, they increased discretionary spending by 30%, with plans to spend another $10 trillion over the next 10 years, argued Mr. McCarthy in an interview with Fox News.
“If you had a kid and you gave him a credit card and he kept hitting the limit, you wouldn’t keep raising it. You would try to see first: “What do you spend your money on? How can we eliminate things?” “, he illustrated.
But on Tuesday, he seemed to be more nuanced: “Who wants to subject the nation to some sort of last-minute threat with the debt ceiling? Nobody wants to do that. »
Prime Minister Justin Trudeau also expressed optimism on the issue on Tuesday.
“Canada will always work to ensure that we are able to weather any storm that the United States deliberately or inadvertently throws at us,” he said.
“We continue to closely monitor what is happening in the United States. But we’re going to make sure that Canadians continue to succeed, no matter what happens there. »