The latest on the talks to raise the debt ceiling
- Treasury Secretary Janet Yellen has repeatedly warned that without an increase to the debt ceiling, the United States could run out of cash to pay the bills as soon as June 1.
- President Joe Biden and House Speaker Kevin McCarthy and their negotiators are working to reach an agreement. Republicans are demanding that any deal must cut federal spending in exchange for raising the debt ceiling.
- Yesterday, talks appeared to stall, with the White House warning negotiations had hit a "speed bump."
Live coverage of the debt ceiling negotiations continue here
Fitch puts U.S.' AAA on rating watch negative
Fitch Ratings, a top credit rating agency, put the United States’ AAA long term foreign currency issuer default rating on negative watch on Wednesday evening.
"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)," the agency said in a statement.
"The failure to reach a deal to raise or suspend the debt limit by the x-date would be a negative signal of the broader governance and willingness of the U.S. to honor its obligations in a timely fashion," Fitch said, adding that such a failure was "unlikely to be consistent with a ‘AAA’ rating."
The move is not a downgrade, but a warning it could do so.
Moody's and S&P, two other ratings agencies, had placed the U.S. on negative watch during debt ceiling talks in 2011. S&P followed through with the downgrade; Moody's did not.
Has the U.S. ever defaulted?
The U.S. has never intentionally defaulted. That “intentionally” framing is key. In 1979, a technical bookkeeping glitch led to late payments, something that was rectified within weeks, only affecting a small group of investors.
House members will go home for Memorial Day weekend, as talks continue
House Majority Leader Steve Scalise, R-La., told members on the House floor that they will be able to go home for Memorial Day weekend after votes Thursday, as debt ceiling talks continue.
Members will be given a 24-hour notice if they're needed back in Washington to vote on a deal, he said, reiterating that they will have 72 hours to review the text of any agreement before the House votes on it.
"I don’t know how my colleagues across the aisle who voted for the 'Default on America Act' are going to look our veterans in the eye this Memorial Day,” House Minority Whip Katherine Clark, D-Mass., countered, referring to the Democrats' nickname for the GOP-passed debt ceiling bill.
“Now you’re sending us home with no resolution," Clark continued. "That’s the plan, to default, to run out the clock.”
All 213 House Democrats sign petition to force debt ceiling vote
House Democratic leaders said Wednesday that all 213 members of their Democratic Caucus now have signed a discharge petition to bypass McCarthy and force a vote to raise the debt ceiling.
It’s “another sign of the unity that we have,” Minority Whip Katherine Clark, D-Mass., told reporters, “and we know who we are fighting for — it’s the American people, and that’s what continues to drive our work.”
She made the announcement in a dramatic fashion, just moments after a top aide slipped her a note while she stood on the dais at the news conference.
Democrats still would need at least five GOP votes to bypass McCarthy and pass the legislation to avoid default. So far, no Republicans have agreed to support it.
Typically in the House, the majority controls what bills reach the floor and the minority party has little say.
But the discharge petition is a little-known, rarely used tool that gives the minority the ability to force a vote on the floor if it can secure signatures from 218 members, a simple majority of the chamber.
"House Democrats have provided a vehicle to end this reckless and dangerous default crisis and avoid the economy crashing," Minority Leader Hakeem Jeffries, D-N.Y., said. "It's now time for House Republicans to break with the extreme wing of their party and join House Democrats to put an end to the default crisis."
Progressive Caucus slams GOP on debt crisis: 'This is McCarthy-made'
The Progressive Caucus held an afternoon press conference where it addressed the ongoing debt negotiations. Members decried McCarthy and the GOP for their continued unwillingness to negotiate, taking a more offensive tone.
"What are they proposing instead? They want you to foot these bills for these tax cuts," said caucus Chair Rep. Pramila Jayapal, D-Wash., adding Republicans have rejected including closing tax loopholes, a billionaire minimum tax and $3 trillion worth of general deficit reduction.
Rep. Ilhan Omar, D-Minn., echoed a similarly bleak tone, specifically discussing how defaulting on the debt would impact McCarthy's own constituents in California.
“Even a short-term default would kill over 62,000 jobs in his district alone. It would jeopardize Social Security payments for 54,000 families in his district," she said.
Rep. Jan Schakowsky, D-Ill., closed with an impassioned speech, highlighting a woman who "called my office in tears" about the potential of losing her $1,200 monthly income.
“This is unnecessary. This is manmade. This is McCarthy-made," she concluded.
GOP negotiators have left the White House
Republicans tasked with negotiating a deal to address the debt ceiling have left the White House.
Reps. Garrett Graves, R-La., and Patrick McHenry, R-N.C., left Capitol Hill for the White House just before noon, saying that it was the administration's team that had invited them.
Earlier in the day, McCarthy said that he was sending his negotiators to finish the talks, though he emphasized that both sides were still "far apart."
Poll: 70% of Americans are concerned the nation will default on its debt
Roughly 7 in 10 Americans are either somewhat or very concerned that Biden and Congress will not reach a deal to raise the debt ceiling ahead of the X-date for default, according to a national poll from Quinnipiac University.
Americans were evenly divided over whether Biden and the Democrats in Congress or McCarthy and the Republicans in Congress were behaving more responsibly in negotiations.
Negotiators are meeting at the White House
Biden’s press secretary said a meeting between negotiators for the administration and House Republicans that began at noon was still underway. The two sides are meeting in the Office of Management and Budget at the White House after days of talks on Capitol Hill have yet to yield a deal.
Karine Jean-Pierre characterized the meetings as "productive," but declined to say when Biden and McCarthy would next speak, saying this would happen "when the time is right."
“We are going to give the negotiators some time," she added.
White House accuses congressional Republicans of holding Americans 'hostage' in debt ceiling debate
The White House hit out at Republican negotiators, accusing them of holding middle class jobs "hostage" and “caving” to the most conservative members of the Republican caucus, in a memo released this afternoon.
Andrew Bates, a White House spokesperson, criticized House Republicans, who he said were "threatening to actively harm their own constituents unless extreme demands are met."
Bates pointed to a quote from hardliner Republican Rep. Matt Gaetz, who when asked about the mood of conservative members, told Semafor that they “don’t feel like we should negotiate with our hostage.”
"House Republicans need to be called out for the vicious threat they are making to sabotage America, and to put down the gun they’re holding to the head of middle class jobs," the White House memo said. "Then they need to face reality and work across the aisle on a reasonable budget agreement."
The memo argued that Republican negotiators were refusing to compromise on broadly popular policies, like strengthening Medicare's ability to lower prescription drug costs. Bates said the Biden administration was not making demands beyond raising the debt ceiling.
Poll: Majority think debt ceiling shouldn't be tied to spending negotiations
A new poll from Monmouth University found that a majority of Americans do not think the debt ceiling should be tied to negotiations about federal spending.
Just 1 in 4, the poll found, support tying the debt ceiling to economic spending.
Biden had insisted his administration would not negotiate over the debt ceiling. But after the deadline was set for June 1, his administration began negotiating on federal spending — a process officials insisted was happening "parallel" to lifting the debt ceiling.
House Democratic angst grows as Biden’s debt limit negotiations with GOP drag on
House Democratic anxieties are flaring over Biden’s negotiations with Republicans to avert default.
Some Democrats fear his limited public statements on the debt ceiling amount to ceding the messaging war to McCarthy and his deputies, who have been ubiquitous in recent days in casting blame on the White House. Other Democrats say Biden is wrong to discredit the 14th Amendment option to tackle the debt limit unilaterally, as the GOP engages in what Democrats see as a hostage standoff.
Ultimately, their angst is about whom the public will blame if a deal can’t be reached, or if the terms of any agreement are draconian. Without a more aggressive effort to talk to the public, Democrats worry that voters will focus their anger on Biden — and them.
One House Democratic lawmaker said the White House needs to do a better job harnessing “the levers of communication of the presidency, which they haven’t effectively utilized up to this point.”
McCarthy says sides still "far apart" on a number of places in negotiations
McCarthy reiterated that there are still a number of places where both sides are "far apart" on negotiations. The remarks came as he announced that he is sending GOP negotiators to the White House today.
"There’s a number of places that we’re still far apart," he said. "I mean, it didn’t seem like it’d be this hard."
McCarthy added that he thinks "we can make progress today."
Republican negotiators head to the White House
Republican debt ceiling negotiators Rep. Garret Graves, R-La., and Rep. Patrick McHenry, R-N.C., departed the Capitol just before noon for their meeting with White House negotiators.
“They invited us, we answered the invitation,” McHenry said.
Asked if this meeting is a hopeful sign, he paused and then said, “Not yet.”
“Look the deal is, is that we’ve been working all night trying to look at things differently, trying to come up with new ideas,” Graves said. “We recognize the urgency here.”
McHenry addressed the fundamental issues at play: “It’s spending, it’s work requirements, it’s two sticking points they are doggedly resisting some reasonable set of, set of outcomes.”
GOP negotiators expected to attend talks at White House
Republican negotiators will go to the White House for debt talks today, according to a source familiar with the negotiations. The meeting was expected to start at noon.
Neither Biden nor McCarthy are expected to attend.
The meeting comes after negotiators disbanded at 1 p.m. yesterday. Today, a Democratic official familiar with the talks characterized the negotiations as hitting a "speed bump."
Debt limit negotiations hit ‘speed bump,’ Democratic official says
Negotiations over how to address the debt limit to avoid a catastrophic default have hit a “speed bump,” a Democratic official familiar with the talks told NBC News today.
After days of citing “productive” negotiations, the tone in Washington appeared to shift yesterday after the negotiators disbanded at 1 p.m. ET with no plans for further talks or meetings between the leaders.
The Democratic official argued that Biden has “negotiated in good faith” on the nation’s budget but said that McCarthy has “bowed to MAGA extremists who want no compromise.” The source said far-right House Republicans are pressuring McCarthy not to budge.