An upbeat Kevin McCarthy left the White House seven weeks ago with a rosy view about the prospects of raising the national debt limit.
“We walked away saying we would continue the discussion,” the House speaker said after an hourlong meeting with President Joe Biden.
The discussion, in fact, has yet to continue.
As the country stares down the prospect of a first-ever default by this summer, there has been no progress toward finding a way out of the debt ceiling standoff – with House members and senators in both parties at a total loss over how Washington will avoid falling off the cliff.
And as each day goes by, lawmakers are growing more uneasy about raising the $31.38 trillion borrowing limit, fearing that they’ll struggle as they scramble at the eleventh hour to find a deal – and enough votes – in a divided Congress.
“Default is not an option,” Senate GOP Whip John Thune said Tuesday.
But how to avoid one – and the catastrophic economic fallout a default could trigger – is anyone’s guess.
The White House says House Republicans should just raise the debt ceiling with no conditions. House Republicans roundly reject that approach and say they won’t pass a clean debt ceiling increase, instead calling for an agreement with the White House on budget cuts. Senate Democrats say House Republicans should put out their plan first – even as they haven’t decided whether to release a Democratic budget of their own.
And Senate Republicans are leaving it all up to McCarthy to find a way forward with the White House.
“We’ll continue to let the majority in the House be able to come up with their proposal, and hopefully they’ll get that done,” said Sen. Mitt Romney, a Utah Republican
Romney added: “I’m always nervous.”
Others are growing angry.
“This is ridiculous to think that we’re going to get down right to the end and say: ‘Ok we just got to do it,” said Sen. Joe Manchin, a West Virginia Democrat.
So far, the two sides can’t even agree to get in a room. And what’s made matters worse: The growing fears of a banking crisis has only led both sides to harden their own positions.
In the Capitol’s ornate Statuary Hall last week where they feted the Irish Taoiseach, Leo Varadkar, for a St. Patrick’s Day lunch, McCarthy confronted Biden and made a straightforward request: “You said that we were going to meet again …. But nobody has called me, and I’m ready to meet anytime you’re ready to meet.”
McCarthy told reporters that he suggested to Biden that they could tie some energy provisions to a debt limit increase, among other matters, including an overhaul of the permitting process for major projects. And he said he was clear to the president: The House can’t pass a debt ceiling increase without conditions nor will Republicans agree to raise taxes.
Biden then pressed McCarthy to unveil the House GOP’s budget plan, which Republicans have not released as they have tried to find an agreement between the various factions in their narrowly divided majority.
“He said, yeah we will get together – he says that all the time. I don’t know if the staff is not relaying what he says,” McCarthy said of Biden.
That same day, the White House relayed its own view: No talks at all.
“We’ve been very clear: ‘We’re not negotiating around the debt ceiling,’” White House press secretary Karine Jean-Pierre said Monday. “This is something that Congress needs to do. It’s their constitutional duty.”
What irks Democrats in particular: Congress suspended the debt limit three times under former President Donald Trump – and Republicans didn’t offer much push back then – and Congress has voted 61 times since 1978 to either raise the borrowing limit or suspend it.
Yet there have been numerous occasions where lawmakers have used the vote to raise the borrowing limit as negotiating leverage – most famously in 2011 when a GOP House furiously battled a Democratic president only to see the US credit rating downgraded as Washington narrowly avoided default. To do so, they agreed to sharp spending cuts across the board on domestic and defense programs, a deal that Congress effectively reversed in the years to follow.
Some Democrats in tough races are comfortable with the approach their leaders are taking in the high-stakes standoff.
“I don’t think we should be negotiating on the debt ceiling,” said Sen. Jon Tester, a Montana Democrat who faces a tough road to a fourth term next year. “I think we should figure out ways to get the national debt under control … But to negotiate, you know, with a gun pointed to our heads, it would drive the economy into recession and raise interest rates. Bad, bad, bad results.”
Sen. Sherrod Brown, an endangered Ohio Democrat, added: “I think Republicans in the House have to start acting like grown ups.”
“They want to whine,” he said of the House GOP.
Yet another Democrat vulnerable in 2024 is demanding that the White House engage with McCarthy.
“We see what happened with the banking, okay, should we not be as concerned about our own finances? Because we saw what can unravel very quickly and cause a major concern,” said Manchin, who has not yet decided whether to run again.
“So, I’m in that camp of wanting to have these serious discussions because I know that many in my caucus don’t seem to be in that camp,” Manchin told CNN on Wednesday.
Indeed, Senate Democrats, themselves, may avoid putting out their own budget resolution – something that Congress is required to approve by April 15 each year, a deadline it routinely ignores. The budget resolution is not required to raise the debt limit but it is intended to outline the majority party’s priorities, though proposing one opens senators up to a marathon voting session in the chamber and many politically charged amendment votes that they are often keen to avoid.
Sen. Sheldon Whitehouse, a Rhode Island Democrat who chairs the Senate Budget Committee, told CNN that Democrats “have not” decided whether to even propose their own budget blueprint.
“I think everybody’s still kicking the tires and getting a look at it and figuring out what our best plan going forward is,” Whitehouse said. He said that Democrats may just decide to “very well wrap ourselves around the Biden budget,” referring to endorsing the president’s budget request he released earlier this month.
When a potential default may occur is a bit uncertain. The nonpartisan Congressional Budget Office has estimated the deadline for when the US could no longer pay its bills could come anytime between July and September, depending on the country’s fiscal outlook.
Behind the scenes, McCarthy has convened several meetings of the so-called five families, who represent the ideological corners of his conference. GOP sources say some of the meetings have centered around a path forward on the debt ceiling. But no major breakthroughs have yet come to pass, and House Republicans have yet to agree on what spending cuts they would demand – a proposal that could be fraught with political peril.
Republican senators say there’s little reason to intervene – at least at this point.
“As a practical matter, nothing we do over here is going to fly in the House, and so, I think it just makes sense for the House to work out their plan and to pass it and then to send it to us,” said Sen. John Cornyn, a Republican from Texas and member of leadership.
Several lawmakers believe that Washington will only act once the heat is really on.
“It’s not urgent yet,” Sen. Josh Hawley, a Republican from Missouri, said. “Until there is a deadline-deadline, people are like, ‘We’ll deal with it tomorrow.’”
CNN’s Nicky Robertson, Morgan Rimmer and Kevin Liptak contributed.