House Speaker Kevin McCarthy suggested a debt-ceiling meeting with President Joe Biden Tuesday didn’t break any new ground but both sides offered glimmers of hope that the looming crisis can still eventually be averted.
After an hour-long meeting in the Oval Office, McCarthy told reporters “I didn’t see any new movement” and that both sides remained at loggerheads over issues like spending cuts.
But he also said staff members would continue to meet and that the leaders would gather again Friday, indicating that talks haven’t broken down.
For his part, Biden called it a "productive meeting" during his own press conference Tuesday evening but also noted that the meeting was sometimes tense and claimed McCarthy occasionally made assertions that were “over the top.”
Biden also announced that staff meetings would begin tonight and will continue every day between now and Friday.
But the president also acknowledged that deep policy differences remain, especially over spending, and that Republicans aren’t being forthright about the depth of their cuts. “I’m not sure they know exactly what they are proposing.”
Other lawmakers present at the meeting offered a mix of positive and negative signs. Senate Majority Leader Chuck Schumer (D-NY) speaking alongside House Democratic Leader Hakeem Jeffries (D-NY), said "there are probably some places where we can agree."
Senate Minority Leader Mitch McConnell (R-KY), speaking alongside McCarthy after the meeting, also offered some hope. He said “the United States is not going to default: It never has and it never will.”
The highly-anticipated Oval Office gathering came more than 3 months after the two leaders last sat down to discuss fiscal issues and just days after Treasury Secretary Janet Yellen announced that a US default could come as early as June 1.
The meeting began with a smile when President Biden wryly told reporters “we’re going to get started, we're going to solve all the world’s problems.” But the meeting only lasted about an hour and clearly didn't yield any sort of breakthrough.
Pressure from business groups
What observers will be closely watching as the talks progress in the days ahead are any signs that Republicans and Democrats are moving away from what are currently irreconcilable positions.
The meeting also comes amid increasing fears from Wall Street that the standoff will at a minimum put downward pressure on stocks through the rest of the month as Washington again flirts with a default.
On Tuesday, stocks closed lower Tuesday as investors waited for developments from Washington about whether the talks would lessen the likelihood of a default within weeks.