--- title: No Debt-Limit Deal As Deadline For Default Looms description: House Speaker Kevin McCarthy and President Joe Biden called the discussion "productive," but key sticking points remain canonical: https://time.com/6281868/debt-limit-deadline-biden-mccarthy/ author: Nik Popli article:opinion: false article:content_tier: free article:published_time: 2023-05-23T00:38:26.000Z article:modified_time: 2026-08-04T07:42:45.510Z article:section: Politics og:title: No Debt-Limit Deal As Deadline For Default Looms og:description: House Speaker Kevin McCarthy and President Joe Biden called the discussion "productive," but key sticking points remain og:url: https://time.com/6281868/debt-limit-deadline-biden-mccarthy/ og:site_name: TIME og:image: https://static.time.com/v3/assets/bltea6093859af6183b/blta4915876407d94dc/698a3d464ee262812331b6d2/Biden-McCarthy.jpg?branch=production&width=1200&quality=75&auto=webp&crop=16:9 og:image:width: 7137 og:image:height: 4015 og:image:alt: President Biden Meets With Speaker McCarthy As Debt Ceiling Negotiations Continue og:type: article twitter:card: summary_large_image twitter:title: No Debt-Limit Deal As Deadline For Default Looms twitter:description: House Speaker Kevin McCarthy and President Joe Biden called the discussion "productive," but key sticking points remain twitter:image: https://static.time.com/v3/assets/bltea6093859af6183b/blta4915876407d94dc/698a3d464ee262812331b6d2/Biden-McCarthy.jpg?branch=production&width=1200&quality=75&auto=webp&crop=16:9 ---  # There's Still No Debt-Limit Deal After High-Stakes Negotiations Between Biden and McCarthy > Sponsored content. 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It explains the politics, personalities and power dynamics behind the headlines, twice a week. #### Where can I get analysis of Washington politics by email? D.C. Brief is TIME's free Washington politics newsletter, available at time.com/newsletters. It is written by a TIME senior correspondent who covers the capital full time. #### Who writes TIME's D.C. Brief? Philip Elliott, a senior correspondent at TIME, writes D.C. Brief. #### Is D.C. Brief free? Yes. D.C. Brief is free at time.com/newsletters. ### Sources * TIME Newsletters: [time.com/newsletters](/c/time-nl-dcbrief-2026q3/newsletters?i=11d66397-75a6-460c-8eff-e276afb1419f&cr=time-nl-dcbrief-2026q3-v1) ## Video: What to Know About the History of the Debt Ceiling [Watch (HLS stream): What to Know About the History of the Debt Ceiling](https://cdn.jwplayer.com/manifests/sJUEUsSN.m3u8) (2:57)  _Published 2023-05-26. The Biden Administration remains locked in a standoff with congressional Republicans over raising the federal debt ceiling, just two weeks before the nation is set to default on its obligations for the first time. The U.S. government hit its congressionally imposed $31.4 trillion borrowing limit in January, and Treasury Secretary Janet Yellen has warned that the country could run out of cash as early as June 1 if Democratic President Joe Biden and Republican House Speaker Kevin McCarthy are unable to reach a deal to raise the debt ceiling._  by [Nik Popli](https://time.com/author/nik-popli/)  ## Nik Popli Staff Writer May 23, 2023 12:38 AM UTC  WASHINGTON, DC - MAY 22: U.S. President Joe Biden meets with House Speaker Kevin McCarthy (R-CA) in the Oval Office of the White House on May 22, 2023 in Washington, DC. Biden and McCarthy were meeting to discuss raising the debt limit in an effort to avoid a default by the federal government. (Photo by Drew Angerer/Getty Images) WASHINGTON, DC - MAY 22: U.S. President Joe Biden meets with House Speaker Kevin McCarthy (R-CA) in the Oval Office of the White House on May 22, 2023 in Washington, DC. Biden and McCarthy were meeting to discuss raising the debt limit in an effort to avoid a default by the federal government. (Photo by Drew Angerer/Getty Images) Getty Images—2023 Getty Images  by [Nik Popli](https://time.com/author/nik-popli/)  ## Nik Popli Staff Writer May 23, 2023 12:38 AM UTC House Speaker Kevin McCarthy emerged from a pivotal one-on-one meeting with President Joe Biden Monday without a deal to raise the debt limit, but expressed optimism about reaching an agreement in time to avert a potentially catastrophic federal default. “I felt we had a productive discussion,” McCarthy said after the meeting. “I think the tone tonight was better than any other time we’ve had discussions.” McCarthy has insisted the Republican-controlled House will not raise the [ debt ceiling](https://time.com/6281003/debt-ceiling-history/), which refers to the maximum amount the U.S. is authorized to borrow to satisfy its obligations, without spending cuts attached. With just days to strike a pact before a looming June deadline, the two sides remain at odds over a GOP proposal to cut spending by imposing [tougher work requirements](https://time.com/6276193/republicans-work-requirements-debt-ceiling/) for federal aid programs and introducing caps on future spending. But the contours of a possible deal have been slowly taking shape. The two sides have discussed a framework for an agreement that would claw back some $30 billion in untapped COVID-19 relief money, approve permitting reforms for energy development, and impose spending caps through the end of 2024, according to those familiar with the talks. Congress and the White House are running out of time to broker a deal before the U.S. Treasury runs out of cash to pay the government’s bills, leading to an unprecedented default. Treasury Secretary Janet Yellen reiterated Monday that funds were projected to run out in early June, and perhaps as soon as June 1\. McCarthy says a deal must be reached this week to have enough time for legislation to pass through the House and Senate. Under legislative rules, House lawmakers have 72 hours to read the bill once the text is released. **Read More:** [_What To Know About the History of the Debt Ceiling_](https://time.com/6281003/debt-ceiling-history/)_._  U.S. Speaker of the House Kevin McCarthy (R-CA), joined by Rep. Patrick McHenry (R-NC), speaks to reporters following his meeting with U.S. President Joe Biden at the White House on May 22, 2023. Alex Wong–Getty Images Like McCarthy, Biden described the meeting as “productive” in a statement, but noted that “areas of disagreement” remain. Monday’s face-to-face meeting marked the third Oval Office discussion on the debt ceiling between the two leaders. It came just one day after Biden returned from the Group of Seven summit in Japan to resume negotiations as pressure intensifies. Sticking points remain. McCarthy has insisted that government spending in the coming fiscal year must be lower than it was last year, drawing pushback from Democrats, who want to keep spending flat from the 2023 fiscal year. Rep. Patrick McHenry of North Carolina, a key McCarthy ally who attended the meeting, told reporters that it would not be easy to resolve the issue. “A directive to cut spending year over year is the toughest thing to do in Washington, but that is the Speaker’s directive to his negotiating team,” said McHenry, who serves as the House Financial Services Committee chairman. --- ### More from TIME --- Another key issue in discussions is the Republican proposal on work requirements for Medicaid, which the Biden Administration has said would result in millions of people losing coverage. The GOP has also introduced new cuts to food aid by making it harder for states to waive work requirements in places with high unemployment. The Congressional Budget Office predicted last month that if the GOP bill became law and tougher work requirements were imposed, about 600,000 Americans would lose health insurance and about 275,000 Americans per month would lose access to food stamps. **Read More:** [_Could Joe Biden Use the 14th Amendment To Solve the Debt Ceiling?_](https://time.com/6278100/debt-ceiling-14th-amendment-legal-theory/) McCarthy has previously said that work requirements for public assistance programs are non-negotiable in debt ceiling talks. On Sunday, Biden said House Republicans are taking “extreme positions” and called the GOP’s current proposal “unacceptable.” But McCarthy has so far held tight to demands for sharper spending cuts with caps on future spending, rejecting the alternatives put forth by the White House that call for reducing deficits in part with new revenue from tax increases to wealthy Americans. “I think we should be looking at tax loopholes and making sure that the wealthy pay their fair share,” Biden said in the Oval Office before the meeting. “I think revenue matters, as long as you’re not taxing anybody under $400,000.” McCarthy said his staff will continue to lead discussions with Biden, though the two leaders will likely “talk every day” until the debt ceiling is resolved. ## Transcript Condiments are warning that the US is on the precipice of economic Calamity. If the government can't come together and raise the federal debt limit, now, this isn't the first time, the US has been in this situation. We've been here before and the debt-limit crisis has always been resolved by Congress, but this year's B is turning out to be a lot more messy than previous years. And since this debt ceiling is one of the few must pass pieces of legislation. Both parties have to use this issue as an opportunity to take a political stand and exact concessions to cut back on government spending, it would cause the government to default on its legal obligations for the first time in history, creating a financial crisis and threatening jobs for everyday Americans. It could even potentially put the US get risk of a recession. The only country that has a debt ceiling is Denmark the debt limit or the debt. Ceiling is a cap on the total amount of money that the federal government is authorized to borrow to fulfill its Financial Obligations. Everything at the government spends, money on military to Social Security, and Veterans Benefits has to be funded, either through tax revenue, or debt. And for the last two decades, the US has been running a budget deficit. Adding 25 trillion dollars in debt. So the treasury Department now says that the government could be unable to issue new debt and pay its bills as early as June 1st. But Congress has always acted when called upon to raise. The debt limit has 1960 Congress. Acted 78 separate times to permanently raise temporarily extend a revised the debt limit. The debt ceiling has become an increasingly political issue in recent years, especially when power in Washington is divided as it is right now, Republicans control the house and Democrats control the presidency in the Senate. Democrats have been very United on this front. I have insisted from the beginning that they won't accept any concessions attached to a deal and continue to blame Republicans for taking the country's credit hostage in our stash. Continue to me as we speak is not a fact and they're making progress I made clear time and again to falling on a national debt is not an option but that no negotiation strategy, may be impractical with the June 1st deadline approaching in less than two weeks. The number of places that we are still far apart. I mean, it didn't seem like the economy, plays a pivotal role in how Americans cast their ballots. So, the outcome of these debt limit discussions, could shape. What happens in 2024, particularly if Biden was unable to raise the debt limit before defaulting, or if he accepts concessions that undo, his legislative accomplishment, for instance, progresses. My see him as weak. If he accepts, the GOP is proposed, work requirements for federal aid. This is a very big moment for Joe Biden. 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