(New York) Raising the debt ceiling in the United States, the subject of tension in Washington, will not come without spending cuts, Republican official Kevin McCarthy said on Monday, affirming his refusal to grant a blank check to the administration of Joe Biden.
He plans to present “in the coming weeks” a text on the subject to the House of Representatives.
“To tackle the debt, we have to come together, find common ground and cut spending,” McCarthy said in a speech to the New York Stock Exchange.
Raising the debt ceiling is at the heart of a political debate that will take on increasing importance in the weeks to come, with the debt of the United States having reached in January, 31,400 billion dollars, the ceiling beyond which the country can no longer issue new loans to finance itself.
PHOTO TIMOTHY A. CLARY, AGENCE FRANCE-PRESSE
Kevin McCarthy called the Democrats, who do not want to link the raising of the debt ceiling to the discussions on the budget negotiations, to “reasonable” negotiations.
“Let’s be clear, defaulting on the debt is not an option,” noted the Republican.
But “a future of higher taxes, higher interest rates, increased reliance on China and an economy that doesn’t work for Americans” isn’t an option either, he said. he added.
Mr. McCarthy plans to present to the House a bill raising the debt ceiling, but also proposing to return the amount of federal government spending to 2022 levels, and to limit their growth to 1% per year over the next ten years. years.
He didn’t provide much more detail, but said health insurance programs for people over 65 and pensions would not be affected.
“It will restore discipline in Washington, to budget-making, and help end the reckless spending that causes inflation,” he said.
“As President Biden continues to fight inflation, Trump Republicans in Congress are trying to hold our economy hostage unless we cut programs that reduce costs for Americans,” the White House said in a statement. a tweet.
Mr. McCarthy had been received by Joe Biden in early February to discuss possible compromises.
The two officials had then recorded their differences, failing to find an agreement.
Temporary emergency measures have been taken to continue to pay the debt, but without an agreement in Congress to raise this ceiling, the United States will find itself in default, unable to meet its financial commitments, perhaps as soon as this summer.
This would precipitate American and global finance into the unknown.
US Central Bank President Jerome Powell again stressed in early March that raising the debt ceiling was “the only timely way out that allows us to pay all our bills”.
In the absence of an agreement between Democrats and Republicans, the consequences are “difficult to estimate”, but “could be extremely negative and cause long-term damage”, he had warned.
Raising the debt ceiling is a priori a technical measure, but it requires the agreement of Congress, which generally does so without major debate.
Since 1960, the US debt ceiling has been raised 78 times, according to the Treasury Department.