The US Approaches Debt Ceiling Deadline: Biden Considers Invoking 14th Amendment as Republicans Demand Spending Cuts
As the US approaches its debt ceiling, President Joe Biden is considering using the 14th Amendment to circumvent it. The amendment states that “the validity of the public debt, authorized by law…shall not be questioned.” According to certain legal experts, this provision empowers the Treasury Department to continue borrowing funds beyond the existing debt ceiling of $31.4 trillion, which necessitates congressional endorsement for any increase or elimination. At least 11 Senate Democrats are urging Biden to invoke his constitutional authority under the 14th Amendment to raise the nation’s debt limit without having to go through Congress. Some House Democrats have also called on Biden to “choose a solution invoking the 14th Amendment of the Constitution over a bad deal.”
However, the Republican-controlled House views the situation differently. In exchange for Biden reducing future spending, it has consented to increasing the debt ceiling. In order to vote for raising the debt ceiling, House Republicans are insisting on significant reductions in spending and a reversal of certain legislative achievements made by President Joe Biden. Biden and the Senate Democrats have maintained their position of refusing to engage in negotiations regarding the debt limit, urging Congress to approve a clean and unconditional increase.
The game of brinksmanship may soon come with a high price tag. Treasury officials say the US will be unable to pay its bills by as early as June 1 unless Congress raises the debt ceiling. With congressional leaders unable to reach a compromise, it is expected that the US will run out of money to pay its bills on June 1.
During Biden's visit to Japan, his negotiators held discussions with prominent Republicans, but no agreement was reached as both sides remained firm on their positions regarding government expenditures for the upcoming fiscal year commencing in October. President Biden and House Speaker Kevin McCarthy agreed to meet Monday afternoon in a last-ditch effort to reach a deal to avoid a default on US sovereign debt after negotiations to raise the federal borrowing limit reached an impasse.
In April, the GOP proposal was approved, which would decrease the amount of discretionary spending to the levels of 2022, followed by a limitation of 1% on forthcoming increments. The House GOP's Limit Save and Growth Act was introduced with an initial proposal from Republicans to restrict discretionary spending in the upcoming fiscal year to levels seen in FY 2022. They also suggested a maximum growth rate of 1% for future spending. House Republican negotiators declined an offer from the White House to freeze government spending in the 2024 budget as part of a deal to raise the debt ceiling.
As the deadline approaches, the situation remains tense with both sides refusing to budge on their demands. The consequences of a default on US sovereign debt could be severe, with a potential domino effect on the global economy. It remains to be seen whether the 14th Amendment will be invoked or if a compromise will be reached before the June 1 deadline.
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