Washington (EFE).- The White House and the Republicans reached an “in principle of agreement” this Saturday to raise the debt ceiling and prevent the United States from entering into suspension of payments, confirmed President Joe Biden and the leader of the House of Representatives, Kevin McCarthy.
“I just got off the phone with the president. After he wasted his time and refused to negotiate for months, we have come to an agreement in principle that he is worthy of the American people,” McCarthy said in a message via social media.
Minutes later, in a brief appearance before the press, the Republican assured that the agreement includes a “historic” reduction in public spending and reforms that “will lift people out of poverty and incorporate them into the workforce.”
In addition, he stressed that it does not contain new taxes or new government programs.
“We still have a lot of work to do tonight to finish the entire text” of the agreement, warned the leader of the Republicans in Congress, who did not want to answer questions from the press because he first wanted to tell lawmakers from his party the details. of the pre-agreement, he said.
McCarthy detailed that legislators will continue with the drafting of the bill tonight.
After this, he will consult with the White House, he will speak with Biden “tomorrow afternoon” before publishing the text, which will be voted on Wednesday the 31st.
Government optimism
An hour after McCarthy’s appearance, President Biden published a statement in which he acknowledged that the principle of agreement contains concessions from the Democrats, but maintains the “key priorities” of his government.
“The agreement represents a compromise, which means that not everyone gets what they want. That is the responsibility of governing ”, he affirmed.
However, he added, the agreement “protects” his “key priorities” and “the legislative achievements of Democrats in Congress.”
“It is an important step forward that reduces spending while protecting critical programs for workers and growing the economy for all,” Biden added.
The president confirmed that negotiating teams from both parties are tasked with finalizing the legislative text, which will be voted on in both the House of Representatives (controlled by Republicans) and the Senate (controlled by Democrats). “I strongly urge both chambers to pass the deal immediately,” he concluded.
The pre-deal comes a day after Treasury Secretary Janet Yellen updated her estimate of the deadline after which the country could face default to June 5.
debt ceiling
The debt limit is the total amount of money the United States Government is authorized to borrow to meet its existing legal obligations to pay Social Security and Medicare benefits, military salaries, interest on the national debt , tax refunds and other payments.
From time to time, the United States faces default on its national debt because, unlike other countries, the government can only issue debt up to the limit set by Congress, which has the power to raise that ceiling as it sees fit.
The country reached its legal debt limit of 31.4 trillion dollars on January 19, which led the Treasury Department to resort since then to extraordinary measures to pay the bills.
When the agreement is finalized and approved in the chambers, a period of confrontation between Democrats and Republicans will come to an end, who had been trying to reach positions on this issue for months.
Institutions such as the Federal Reserve (Fed) have warned these months about the risks of not raising the debt ceiling. Failure to do so, recently warned its president, Jerome Powell, “would be unprecedented” and “we would be in unknown territory” whose consequences “would be very uncertain.”
Organizations such as the International Monetary Fund (IMF) also warn of the urgent need for Congress to act since, if it does not, there will be “serious repercussions” both for the US economy and globally.