Biden optimistic about debt-ceiling deal with Republicans

US president Joe Biden has indicated he is optimistic a deal can be reached with his Republican political opponents on raising the US debt ceiling.

However, the speaker of the US House of Representatives, Kevin McCarthy, a Republican, on Monday said the sides remained “far apart”.

Crucial direct talks between Mr Biden and top political leaders in the US Congress, including Mr McCarthy, on the debt limit are expected to take place on Tuesday.

The Biden administration has warned that a default by the US on its debts could trigger widespread economic turmoil both domestically and around the world. However, time for reaching a deal on raising the debt limit is getting tight.

Wave of innovation aims to make desalination sustainable

---

Smart heater gives greater control over comfort and cost

---

Helping stressed-out GPs manage staffing issues in the workplace

---

Card data suggests it’s not all doom and gloom in the hospitality sector

---

[ Little immediate progress in crucial talks about US debt ceiling ]

[ Biden insists US ‘not a deadbeat nation’ as risk of debt default looms ]

The president has urged Congress to raise the debt ceiling without any conditions and signalled that he could talk about budgetary issues as part of a separate process.

In a letter to Congress last week, treasury secretary Janet Yellen warned the US might not be in a position to pay its bills from as early as the beginning of June.

Speaking to reporters on Sunday, Mr Biden said he remained optimistic that an agreement could be reached with Republicans. He said while he was a “congenital optimist”, he believed there was a desire “on their part, as well as ours, to reach an agreement, and I think we’ll be able to do it”.

Deputy US treasury secretary Wally Adeyemo in an interview with broadcaster CNN on Sunday described the talks that have been taking place as “constructive”.

Asked on Monday if he could provide any updates on the behind-the-scenes talks which have been under way between senior aides to the various political leaders, the president replied “No.”

Mr McCarthy, however, appeared to have a less sunny view of the discussions when he met reporters on Monday. He said the sides were still “far apart”.

“It doesn’t seem to me yet they want a deal, it just seems like they want to look like they are in a meeting but they aren’t talking anything serious,” he said.

[ Fed increases US interest rates again but leaves open possibility of pause in rises ]

[ US economy adds 253,000 jobs in April in sign of labour market strength ]

Mr McCarthy has indicated a deal would need to be finalised by the weekend to allow sufficient time for it to pass through Congress. Mr Biden is scheduled to leave on Wednesday for the G7 summit in Japan.

Republicans who control the House of Representatives have passed a Bill that would raise the debt limit in return for significant spending cuts.

On Sunday, Mr Biden appeared at least willing to entertain some Republican proposals. Asked whether he would consider proposals put forward by Republicans in the House of Representatives to introduce more work requirements for those availing of social programmes, the president did not reject this completely.

Rather, he pointed to his own Senate record of voting for welfare work requirements in the 1990s.

“I voted for tougher aid programmes that’s in the law now, but for Medicaid [the federal and state programme to help meet medical costs for those on lower incomes] it’s a different story. And so I’m waiting to hear what their exact proposal is.”

The White House said at a press briefing last week that a debt default would “threaten eight million jobs, a recession, retirement accounts and social security and Medicare payments”.

At present, the US government is limited by law to borrowing no more than $31.4 trillion (€28.5 trillion). The US is coming perilously close to reaching that limit.

The US treasury has essentially over recent months been juggling money around to meet its bills. The exact date on which it will no longer have sufficient funds to do that – known as the X date – is likely to be determined by the strength of tax returns in May and June. However, it is generally expected that the existing debt limit will be reached within a few weeks or a couple of months at most.