Biden rejects McCarthy’s debt ceiling demands: ‘America is not a deadbeat nation’

Mr Biden is calling on Republicans to cease threatening a ‘catastrophic’ default on America’s sovereign debt

President Joe Biden on Wednesday rejected House Republicans’ demand for him to agree to massive cuts to popular government programs in exchange for Congress allowing the US to avoid a catastrophic default on America’s sovereign debt.

Speaking at a union hall in Acokeek, Maryland, Mr Biden slammed the “Maga Republicans” led by House Speaker Kevin McCarthy for threatening to allow the US government to stop paying its bills if Mr Biden does not accept GOP plans to roll back much of his administration’s legislative programme from his first two years in office.

He noted that Mr McCarthy had previously spoken on the House floor to propose what Mr Biden described as “huge cuts [to] very important programs that millions of hardworking middle class Americans count” and “more tax giveaways and overwhelming benefits for the wealthiest Americans and biggest corporations”.

In his remarks on the House floor, Mr McCarthy criticised Mr Biden for “skipping town to deliver a speech in Maryland rather than sitting down to address the debt ceiling”.

The president responded in his speech to union members.

“While I'm here in this union hall with us, Speaker McCarthy just got finished speaking to the United States Congress some few hours ago ... Do you think he told the wealthy and powerful it's about time they step up and start paying a fair share? Not a word,” he said.

The president said Mr McCarthy’s plan is “the same old trickle-down economics dressed up in Maga clothing” and noted that one proposal circulating among House Republicans would cut “critical programs” by 22 per cent.

He also pointed out that Republicans want to repeal the funding appropriated last year for the Internal Revenue Service and roll back a part of last year’s Inflation Reduction Act that would let Medicare negotiate the prices for seniors’ prescription drugs.

“We just finally beat Big Pharma by giving Medicare the power to negotiate lower drug costs. I want to keep going, Maga Republicans in Congress want to hand Big Pharma back the power,” he said.

He called the GOP’s intransigence on the debt ceiling and their threats to allow default “dangerous” because it would threaten hundreds of years of good credit built by the US government, which has never once failed to pay its bills.

“Maga Republicans in Congress are threatening to default on the national debt — the debt that took 230 years to accumulate overall — unless we do what they say. They say they're going to default unless I agree to all these wacko notions,” he said.

Mr Biden added that such a course of action would be “worse than totally irresponsible” and said the cost of a default would be borne by everyday Americans.

“It would mean cuts in Social Security and Medicare and higher interest rates for things like credit cards, car loans, mortgages,” he said. “Working people, the middle and seniors would pay the price — the entire economy would be at risk”.

The president also pointed out that under the Trump administration, Republicans allowed the US national debt to balloon by 40 per cent in just four years even as they increased the debt limit when needed.

“In a speech to Wall Street, the speaker failed to guarantee he would be the first speaker not to default on our debt. Let's be clear. If he fails, the American people will be devastated. Not just 10 or 20 years from now, but today,” he said.

He also pointed out that even Mr Trump had said he “could not imagine” the US defaulting on its’ debt.

“I guess he didn’t know the new Maga Republicans he bred,” Mr Biden said.

“America is not a deadbeat nation. We meet our obligations, and I made clear to Speaker McCarthy about how we should proceed to settle our differences. And no one should do anything to jeopardize the full faith and credit of the United States of America instead of making threats of default if I don't go along with what they want,” he added before calling for a “real, serious, detailed conversation” about how to grow the US economy while reducing the government’s budget deficit.