Debt ceiling talks between the White House and House Speaker Kevin McCarthy’s office have hit a snag, and negotiators have put a pause on the talks, multiple sources tell CNN.
Negotiators met briefly in the Capitol on Friday before breaking up, and as of right now, there are no more meetings scheduled for the day.
This setback dashes hopes that there could be a deal in principle by this weekend.
GOP Rep. Dusty Johnson, an ally of McCarthy and chair of the centrist Main Street Caucus, told CNN that spending cuts are the biggest sticking point in the debt ceiling negotiations that have been put on hold.
“We are too far apart on the topline number,” Johnson said, referring to the level of discretionary spending for fiscal year 2024. “McCarthy is holding the line. He knows where the Republican conference is. And the White House does not understand that Washington has a spending problem. “
“The gap on topline numbers is not the only problem, but it’s the biggest problem,” he added.
Johnson said he thinks a deal is still possible by the early June deadline, but said, “we’re in bad shape.”
“Biden needs to decide if he wants a deal or not,” Johnson said.
Sources familiar with the White House’s thinking acknowledge that part of the reason for the temporary breakdown in talks is that White House negotiators view the extent of spending cuts House Republicans are pushing for as unacceptable, though the White House has expressed a willingness to cut some spending.
McCarthy confirmed that talks have paused, saying there’s not enough “movement” from the White House and bringing up the issue of spending cuts.
“We’ve got to get movement by the White House. And we don’t have any movement yet,” McCarthy told reporters as he headed into the Capitol.
Asked why he had such an optimistic tone one day earlier, McCarthy said, “I really felt we were at the location where I could see the path. The White House is just – we can’t be spending more money next year. We have to spend less than the year before. It’s pretty easy.”
The pause in and of itself doesn’t mean the talks are falling apart. High-stakes talks on Capitol Hill over the years often feature derailments or collapses before negotiators pull things back on track. But it does underscore the challenges ahead to reaching a deal.
Time is of the essence and pressure is building to raise the borrowing limit ahead of June 1, which is the earliest date the Treasury Department says the government could be unable to pay its bills. If the US were to default, it would likely trigger a global economic catastrophe.
McCarthy said he has not spoken to the president and did not answer questions about next steps.
GOP Rep. Garret Graves, who is leading negotiations for House Republicans, left a brief meeting with negotiators in the morning saying the situation was “not productive.” He said he is not sure they will meet again this weekend.
“Until people are willing to have reasonable conversations about how you can actually can move forward and do the right thing we aren’t going to sit here and talk to ourselves. That’s what’s going on,” Graves said.
As talks stalled, a White House official acknowledged that there are “real differences” and “talks will be difficult,” but said the president’s negotiating team is working to reach a “reasonable bipartisan solution.”
This story has been updated with additional information.
CNN’s Lauren Fox, Phil Mattingly, Jeremy Diamond and Arlette Saenz contributed.
Source: www.cnn.com