With a little more than a week to go until the June 1 debt default deadline set forth by Treasury Secretary Janet Yellen, House Speaker Kevin McCarthy, R-Calif., told his conference Tuesday morning that he and the White House are “nowhere near a deal yet,” according to Punchbowl News.
McCarthy’s comments come one day after a meeting with President Joe Biden at the White House, which both men characterized as “productive,” but similarly advised that they were still far apart on an accord.
“We are nowhere near a deal yet,” McCarthy told a closed-door meeting of his conference, per Punchbowl and other news outlets, asking his fellow Republicans to “hang with me on the debt limit.”
Speaking to reporters after the GOP meeting, McCarthy reiterated his position.
“We’re not there yet,” McCarthy said Tuesday morning, before railing on Democrats and the Biden administration and accusing them of reckless spending.
“There are certain things that divide us,” he added. “You cannot spend more money next year than we spent this year. Clear as day.”
But, McCarthy said, it’s possible that “we could finish this by June 1,” the date that Yellen and other economists warn is the ‘x-date’ when the U.S. can no longer pay its bills.
If Congress fails to act in time, the U.S. would default on its loans for the first time in its history, resulting in social security, military pay and other checks not going out and the government and Americans being hit with higher interest rates. A U.S. debt default also could roil global markets and potentially trigger a recession, leading to job layoffs, experts say. Even butting up against that deadline without a deal could come with consequences.
The California Republican said that the House has already done its job by passing a bill to raise the debt ceiling in April, slamming the Democratic-led Senate for its inaction and the Biden administration on spending and the state of the economy.
“I don't understand why they thought this day would never come,” he said. “That's why on Feb. 1, when I sat down with the President, I said let's work together.”
In a statement after Monday’s meeting, President Biden called the meeting “productive,” noting that both leaders “reiterated once again that default is off the table and the only way to move forward is in good faith toward a bipartisan agreement.”
"While there are areas of disagreement, the Speaker and I, and his lead negotiators Chairman [Patrick] McHenry and Congressman [Garret] Graves, and our staffs will continue to discuss the path forward," the president added.
To that end, the White House’s top negotiators – Office of Management and Budget Director Shalanda Young, counselor Steve Ricchetti and White House Office of Legislative Affairs Director Louisa Terrell – returned to the Capitol on Tuesday to continue negotiations with McCarthy’s team.
“Just going to work,” Ricchetti told reporters.
Biden's top spokesperson, White House press secretary Karine Jean-Pierre, took a question at a briefing on Tuesday afternoon about why the president is expressing optimism about the proceedings.
"If everyone is working in good faith, and recognizes that no one is going to get -- either side is going to get exactly what they want, we'll get it done," she said. "That's the way we see this."
"Coming out of the meeting yesterday ... both the president and the speaker reiterated that default is off the table," Jean-Pierre continued. "So now we have to do this in good faith, we have to move forward."
Jean-Pierre said that negotiators met late into the night Monday and continued their discussions Tuesday.
"We're seeing movement," she said, before declining to go into defail about specifics. "We believe that this should get done as soon as possible. Again, they've been productive. We've heard that from the speaker, we've heard that from the president. The meetings continue to occur and happen with on the staff level, and we're happy to see that."
When asked if she agrees with McCarthy's assessment that the two sides are still fall apart, Jean-Pierre said she'd "let the speaker speak for himself."
"From from what I know, from what I can tell you at this moment, the meeting that the President had with the speaker yesterday was indeed productive, and we're going to continue to let the staffers the negotiation and negotiation teams continue to have this conversation and meet," she added.
McCarthy told reporters Tuesday that he's "hopeful" that there will be progress from the day's discussions. The California Republican said in response to a question from Spectrum News that he has not spoken to President Biden on Tuesday about the negotiations.
He also said there's "always a possibility" that a deal could be reached as soon as Tuesday, adding: "I'm a very optimistic person."
Also Tuesday, House Democratic leaders held a press conference to condemn the spending cuts proposed by Republicans in their bill to raise the debt limit.
“The MAGA majority wants the American people to make an impossible choice: accept devastating cuts or a devastating default,” House Democratic Whip Katherine Clark, D-Mass., said, accusing the GOP of manufacturing a debt limit crisis “so they can bully and threaten the very people they were sent to Washington to represent.”
“So here's my advice to Speaker McCarthy: start listening to the people that we represent,” she continued.
California Rep. Pete Aguilar, the chair of the House Democratic Caucus, condemned moderate Republicans for going along with their conference and supporting McCarthy’s bill.
“They could have voted with the American people to protect seniors and veterans and school teachers,” Aguilar said. “Instead they joined hands with [Georgia Rep.] Marjorie Taylor Greene and [New York Rep.] George Santos.”
“We intend to do the right thing by the American people, to do what we have done time and time again: pay our bills and avoid a disastrous default and put people over politics,” said Colorado Rep. Joe Neguse.
Some House Democrats are raising concerns about potential concessions the White House may give to Speaker McCarthy in exchange for a deal to avert default, particularly increased work requirements for social safety net programs and cutting spending.
"I think there would be a huge backlash from our entire House Democratic caucus," Washington Rep. Pramila Jayapal, the Chair of the Congressional Progressive Caucus, told CNN on Tuesday. "It's important that we don't take steps back from the very strong agenda that the president himself shepherded and led over the last two years."
"It's going to be a problem," New York Rep. Alexandria Ocasio-Cortez told the outlet. "We do not legislate through the debt ceiling for this very reason."
"I cannot support work requirements, additional work requirements, which are just going to take away benefits," California Rep. Ro Khanna told ABC News.
Moderates in the Democratic conference, on the other hand, took a different approach.
"I'm open to anything at this point, to avoid default," Minnesota Rep. Dean Phillips told ABC News.
Spectrum News' Ryan Chatelain and Joseph Konig contributed to this report.