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4 minute readMay 22, 202311:52 PM GMT+3Last Updated 27 min agoUS debt ceiling talks 'on right path,' McCarthy says before Biden meeting
By David Morgan, Nandita Bose and Richard Cowan
WASHINGTON, May 22 (Reuters) - Top congressional Republican Kevin McCarthy said on Monday afternoon that talks over raising the U.S. federal government's $31.4 trillion debt ceiling were "on the right path" hours ahead of a meeting with Democratic President Joe Biden.
The president and the speaker of the House of Representatives, McCarthy, have just 10 days to reach a deal to increase the government's self-imposed borrowing limit or trigger an unprecedented default.
Treasury Secretary Janet Yellen on Monday offered a sobering reminder of how little time is left, saying the earliest estimated default date remains June 1 and that it is "highly likely" that Treasury will no longer be able to pay all government obligations by early June if the debt ceiling is not raised.
Biden and McCarthy will meet at 5:30 p.m. EDT (2130 GMT), the White House said, after their negotiating representatives met for more than two hours on Monday.
U.S. markets rose on Monday as investors awaited updates on the negotiations.
It will take several days to move legislation through Congress if and when Biden and McCarthy come to an agreement. McCarthy said that a deal must be reached this week for it to pass Congress and be signed into law by Biden in time to avoid default.
We can get a deal tonight. We could deal tomorrow but you got to get something done this week to be able to pass it and move it to the Senate," McCarthy told reporters.
A White House official on Monday said that Republican negotiators had proposed additional cuts to programs providing food aid to low-income Americans, and emphasized no deal could pass Congress without support from both parties.
Republicans are pushing for discretionary spending cuts, new work requirements for some programs for low-income Americans and a clawback of COVID-19 aid approved by Congress but not yet spent in exchange for an increase, which is needed to cover the costs of lawmakers' previously approved spending and tax cuts.
Democrats want to hold spending steady at this year's levels, while Republicans want to return to 2022 levels. A plan passed by the House last month would cut a wide swath of government spending by 8% next year.
Biden, who has made the economy a centerpiece of his domestic agenda and is seeking re-election, has said he would consider spending cuts alongside tax adjustments but that Republicans' latest offer was "unacceptable."
The president tweeted that he would not back "Big Oil" subsidies and "wealthy tax cheats" while putting healthcare and food assistance at risk for millions of Americans