Talks to raise the U.S. government’s debt ceiling began Wednesday with Republicans and will continue next Friday to try to reach an agreement.
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U.S. President Joe Biden offered remarks following a meeting with the leaders of the two parties in the House of Representatives and the Senate to negotiate raising the country’s 34-million-dollar debt ceiling. The parties did not reach an agreement and will meet again on May 12.
During a speech in Westchester County, New York, Biden warned that “if we don’t pay our debt, the whole world will be in trouble.”
A national default would cause several effects, including higher interest rates on credit cards, mortgages, delays in Social Security payments and increased unemployment, the president warned.
The situation is worrying investors, which has driven the cost of insuring U.S. government debt to record highs. Meanwhile, Wall Street is increasingly concerned about the risks of an unprecedented default.
The Treasury Department announced that April tax collections confirm the recent downward trend in revenues. This situation, coupled with rising outlays, is likely to increase pressure on Congress to reach an agreement on the debt limit soon.
Republicans seek to raise the nation’s debt limit in exchange for spending cuts, while Democrats, including the president, want to raise the limit without conditions.
