Biden-McCarthy meeting ends ‘better’ — but with no clear path to deal

Speaker Kevin McCarthy and President Joe Biden ended their one-on-one meeting on Monday still short of a deal to avoid a U.S. debt default that could come as soon as June 1.

Yet McCarthy described the tone of the meeting “better than any other” discussion, adding that negotiators for both parties will continue working.

“I believe we can still get there. I believe we can get it done,” McCarthy said, sounding upbeat for the first time after a weekend of volatile bipartisan talks.

During their first face-to-face meeting in six days, McCarthy and Biden spoke for more than an hour about remaining sticking points, including looming spending cuts. Now, McCarthy said both he and Biden directed their negotiators — who already met for several hours earlier Monday — to “work through the night” as they race toward a deal before U.S. borrowing power runs out in as soon as 10 days.

“I feel like it was productive in the professionalism, the honesty in one another, and the desire to try to find common ground,” McCarthy said.

But when asked about specifics, such as the GOP’s demand for stricter work requirements for government social programs, McCarthy said: “There’s nothing agreed to” — illustrating the yawning gaps that still exist between the two sides.

To get any agreement through both chambers of Congress, GOP leaders have said they must reach a bipartisan fiscal deal this week so there’s enough time for both chambers to pass the measure and send it to Biden's desk to avoid a market-crashing debt breach.

Biden officials, including Treasury Secretary Janet Yellen, have repeatedly warned that the U.S. risks running out of cash to pay its obligations as soon as June 1. But there’s little certainty around that exact date, and the pace of a potential default — which has frustrated many Republicans, particularly as other economists predict a so-called X-date closer to June 8.

It’s all left a sense of deep unease around the Capitol, where lawmakers are eager to leave town for a weeklong Memorial Day recess on Thursday afternoon.

Ahead of the meeting, Biden had been upbeat about negotiations with McCarthy, even acknowledging the need for spending cuts — something the left of his party has been loath to do. But Biden had also called for the two parties to look at “tax loopholes” — something McCarthy appeared to rule out as he spoke post-meeting.

“We’re not looking at revenues. And if you think to put some kind of taxes, it would only hurt our economy for one,” McCarthy said, calling it a “stupid thing to do” because it would feed inflation.

McCarthy also ruled out any decreases in defense spending as part of a final deal, drastically narrowing the window of federal spending that is on the table for cuts.