Top Republican says US House won't raise debt limit without spending cuts

Top Republican says US House won't raise debt limit without spending cuts

US House Speaker Kevin McCarthy delivers a speech on the econony at the New York Stock Exchange (NYSE) in New York
US House Speaker Kevin McCarthy delivers a speech on the econony at the New York Stock Exchange (NYSE) in New York. Photo: TIMOTHY A. CLARY / AFP
Source: AFP

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Republican leader Kevin McCarthy vowed Monday that the US House would not approve a "no-strings attached" debt limit increase, adopting a hard line ahead of budget negotiations with President Joe Biden.

In a speech at the New York Stock Exchange, McCarthy slammed Biden, a Democrat, for "reckless" spending and called for the president to accept a "reasonable negotiation" to hash out a fiscal compromise addressing rising debt without risking a default.

McCarthy added that the House would pass a bill in the coming weeks -- to raise the debt ceiling -- that includes spending cuts.

He did not provide specifics but said the program would not involve reductions in Social Security and Medicare, two politically popular programs.

The House speaker's remarks are designed to pressure Biden into accepting a Republican fiscal agenda.

The Biden administration has demanded that congressional Republicans not tie budget talks to the usual rubber-stamp process of raising of the debt ceiling. It released remarks ahead of McCarthy's, criticizing his expected stance.

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McCarthy, a close ally of former president Donald Trump, said Biden's policies added trillions of dollars of debt to the US fiscal portfolio -- a move that he argued had also caused the inflation crisis.

"Addressing the debt requires us to come together, find common ground and reduce spending," McCarthy said.

"Let me be clear defaulting on our debt is not an option. But neither is a future of higher taxes, higher interest rates, more dependency on China and an economy that doesn't work for working Americans," he added.

McCarthy said he feared Biden would be the first US president to "bumble into a default."

Holding 'hostage'

Ahead of McCarthy's speech, the White House pointed to comments from former presidents Ronald Reagan and Donald Trump, noting the importance of reliable US debt payments to the country's international standing.

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"Speaker McCarthy is holding the full faith and credit of the United States hostage, threatening our economy and hardworking Americans' retirement," said White House spokesman Andrew Bates according to a statement sent early Monday.

The statement added that extreme Republicans' wish lists "will impose devastating cuts on hardworking families, send manufacturing overseas, take health care and food assistance away from millions of people, and increase energy costs —- all while adding trillions to the debt with tax cuts skewed to the super-wealthy and corporations."

But McCarthy alluded to Biden's record of fiscal moderation in the Senate and as vice president, arguing that he has strayed away in embracing more robust social spending as president.

As president, Biden has signed into law a $1 trillion infrastructure package and made significant moves pumping billions of dollars more into domestic semiconductor manufacturing and investments in green energy.

As the Republican leader in the House before the midterm elections made him Speaker, McCarthy opposed all of these laws.

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Source: AFP

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