(Bloomberg) -- President Joe Biden responded to House Speaker Kevin McCarthy’s demands that he begin negotiations over the debt ceiling by challenging Republicans to produce a public budget plan before departing Thursday for a two-week Easter recess.
The request — conveyed in a letter sent to McCarthy and posted by the White House to its social media channels — said that Republicans producing the plan would help lay the framework for an “in-depth conversation” once lawmakers returned in April.
“For that conversation to be productive, we should both tell the American people what we are for,” Biden said.
Biden did not explicitly say that he would be unwilling to meet McCarthy if Republicans refused to produce a budget, and White House aides also declined to make that threat earlier in the day.
Yet the White House is eager for GOP lawmakers to outline a proposal that could earn the approval of their narrow majority, believing such a plan would include cuts to politically popular government programs.
Republicans have said they would miss their previous deadline of mid April to produce a 10-year budget plan, blaming the White House for producing their document a month past the statutory deadline.
Earlier Tuesday, Biden indicated there would be little to discuss if Republicans did not release a full budget, and bristled at McCarthy’s suggestion - in the letter sent earlier in the day to the White House — that they begin talks on a list of spending cuts and regulatory changes outlined by Republicans.
“I don’t know what we’re going to meet on,” Biden told reporters before boarding Air Force One after speaking in Durham, North Carolina. “The deal was we each put down our own budget.”
Biden and McCarthy last met on Feb. 1 to discuss raising the debt ceiling, which was reached in January and must be increased sometime this summer when Treasury runs out of accounting moves to stave off a payments default on US obligations.
“With each passing day, I am incredibly concerned that you are putting an already fragile economy in jeopardy by insisting upon your extreme position of refusing to negotiate any meaningful changes to out of control spending alongside an increase of the debt limit,” McCarthy said in his letter.
McCarthy told CNBC on Tuesday morning that the White House insistence on a budget before talks made little sense. He said the budget has “nothing to do” with the debt ceiling since it is just a Republican-only proposal.
The McCarthy letter and White House response illustrates how deep the debt ceiling standoff has become.
One of McCarthy’s key allies, Financial Services Chairman Patrick McHenry, on Tuesday said at an event hosted by Punchbowl News that he was pessimistic about a debt-ceiling increase given the hardened positions.
McCarthy suggested attaching a series of legislative proposals to the debt ceiling increase, including cutting domestic appropriations, getting back unspent coronavirus funds, adding more work requirements to government benefit programs and loosening regulations on energy projects.
“We cannot solve the nation’s fiscal problems overnight and House Republicans are not demanding that we do so,” the letter states.
However, the letter does not insist on any one proposal as the priority, a sign of possible flexibility.
The GOP has proposed cutting $130 billion from domestic agencies in fiscal 2024 and conservatives would like to see future growth of those accounts capped at 1% per year.
--With assistance from Jordan Fabian.
©2023 Bloomberg L.P.