Berliner Boersenzeitung - Biden says Republican debt ceiling demands 'unacceptable'

Speaking at a press conference just before returning to Washington from the G7 summit in Hiroshima, Japan, Biden said Republicans' latest demands for spending cuts as a condition for raising the US government's borrowing authority were "frankly unacceptable."

"It's time for the other side to move from their extreme positions," he said.

Biden said he would talk directly with Republican leader, House Speaker Kevin McCarthy, during his Air Force One flight on Sunday back to Washington and said "we can reach an agreement."

But he also said that he was looking into a dramatic attempt to invoke an obscure constitutional clause -- which states that the validity of public debt "shall not be questioned" -- to circumvent Congress and raise the debt ceiling himself.

"I can't guarantee that they wouldn't force a default by doing something outrageous," Biden said of the Republicans. "I'm looking at the 14th amendment."

"I think we have the authority. The question is could it be done and invoked in time," he said.

Biden had planned to travel from Japan to Papua New Guinea and Australia but cut short the Asia trip due to the ongoing debt talks.

The Treasury Department says that the government could run out of money and default on its $31 trillion debt as early as June 1 if Congress, where Republicans control the House of Representatives, does not authorize more borrowing.

- 'Hostage' accusation -

The debt ceiling raise is usually an uncontroversial annual procedure but this year the increasingly hard-right Republican party has turned the threat of default into a powerful lever to try and force Biden to accept making heavy spending cuts. Biden has refused, accusing his opponents of putting the US economy at risk for political point scoring.

Discussions appeared to be at an impasse overnight Saturday in Washington, as both sides traded accusations.

"We're making 0 demands to avoid default. You're the only ones with a hostage," tweeted White House spokesperson Andrew Bates, accusing Republicans of seeking to trigger a recession in the world's leading economy.

White House Press Secretary Karine Jean-Pierre said in a statement that the latest Republican demands were "a big step back and contained a set of extreme partisan demands that could never pass both houses of Congress."

She said that McCarthy's hand had been forced by his party's pro-Donald Trump wing which is "threatening to put our nation into default for the first time in our history unless extreme partisan demands are met."

McCarthy, however, tweeted Saturday to say the White House was the one "moving backward."

"Unfortunately, the socialist wing of the Democrat Party appears to be in control -- especially with President Biden out of the country," he said.

On Friday, Republicans had briefly walked out of negotiations, but after talks restarted, Jean-Pierre said she was "optimistic."

And Biden had insisted Saturday that he was "not at all" worried.

More borrowing is required by the US government just to meet expenditures already made, meaning failure to strike a deal to lift the debt ceiling would leave Washington unable to pay its bills, triggering a likely array of economic shockwaves around the world.

(K.Müller--BBZ)