Republican negotiators walk out of debt talks, say White House unreasonable

"Unless they (WH) are willing to have reasonable conversations about how you can actually move forward and do the right thing, we're not going to sit here and talk to ourselves"

House Speaker Kevin McCarthy’s top debt-ceiling negotiators abruptly left a closed-door meeting with White House (WH) representatives soon after it began on Friday morning. 

“Look, they’re just unreasonable,” said Representative Garret Graves, House Speaker Kevin McCarthy’s designated lead negotiator in talks.  Graves said he did not know if the negotiators would meet again Friday or over the weekend.

“Unless they are willing to have reasonable conversations about how you can actually move forward and do the right thing, we’re not going to sit here and talk to ourselves,” he said.

The White House said a deal remains possible. The two sides have little time to agree on a deal to raise the federal government’s $31.4 trillion borrowing limit or risk a default. The Treasury Department has warned that the government could be unable to pay all its bills by June 1. White House negotiators Shalanda Young and Steve Ricchetti said they were going to play it “by ear”. 

 

Republicans have taken a hard line in negotiations, with the House Freedom Caucus urging the Senate to vote on a previously passed House bill that would raise the limit through March in exchange for 10 years of sharp spending cuts.

House and Senate Democrats have raised concern over the inclusion in the talks of new work requirements for some federal benefit programs for low-income Americans.

U.S. Stocks, Treasury yields and the dollar all moved lower on Friday following the pause and after comments from Federal Reserve Chairperson Jerome Powell on monetary policy.

"It could be for theatrics. It could be to put more pressure on the Democratic caucus and also take advantage of the fact that Biden is overseas. But this headline on a Friday afternoon is definitely not a positive," Quincy Krosby, chief global strategist at LPL Financial, said in an interview.

Biden was in Japan attending a meeting of the Group of Seven wealthy nations. Republicans have criticized his decision to go forward with his trip at a sensitive time in the talks.

"@POTUS waited months before agreeing to negotiate with @SpeakerMcCarthy on a spending deal," top Senate Republican Mitch McConnell said on Twitter. "They are the only two who can reach an agreement. It is past time for the president to get serious. Time is of the essence."

Republicans, who control the House by a 222-213 majority, for months had been insisting that Democrats agree to spending cuts in exchange for a deal to raise Congress's self-imposed debt limit. The limit needs to be lifted regularly because the government spends more than it takes in taxes.