GOP debt ceiling negotiators say day ended with ‘significant gap’ between sides

Republican negotiators are warning that a “significant gap” remains between the White House and GOP lawmakers on a deal to raise the debt ceiling, with nine days to go until June 1 — the day the Treasury Department has said the U.S. could default.

The fundamental issue is top-line discretionary spending levels, GOP negotiators Reps. Garret Graves (R-La.) and Patrick McHenry (R-N.C.) said in extensive comments to reporters late Tuesday afternoon.

“There is a significant gap between where we are and where they are on finances,” Graves said. “Unless and until the White House recognizes that this is a spending problem, then we’re gonna continue to have a significant gap.”

McHenry echoed that the “fundamental issue of spending still remains inside the room and outside the room.”

The debt ceiling bill House Republicans passed last month calls for capping fiscal 2024 federal funding at fiscal 2022 levels as part of an effort to cut spending, which Democrats have rejected. The White House came around with a counteroffer to freeze funding at fiscal 2023 levels, but Republicans have turned that down, insisting that any agreement must include spending that is lower than current levels.

Negotiators met earlier Tuesday, but there was no plan for any other meeting with White House officials as both sides aim to think of new proposals to try and close the gap between them. But Republicans said they plan to stay at the Capitol and noted the White House team is welcome back, should they want to meet.

Graves said there has been “substantial progress” in some negotiation areas. 

But he likened talks about the most important issues to the process of buying a used car.

“They’re gonna say, ‘Well I gotta go talk to my manager — oh sorry, the manager won’t drop the price, but he’ll throw in car mats.’ Like, that doesn’t do it,” Graves said. “And I feel like we’ve been through a few of those iterations, which is inappropriate. We need to be able to have empowered negotiators in the room.”

McHenry also speculated that White House negotiators Steve Ricchetti, Shalanda Young and Louisa Terrell have been constrained by “the top level of the White House” to not cut spending.

“If they’re making that as a play call,” McHenry said of the White House, “they’re completely misreading the situation.”

At the same time, Republicans have flatly rejected suggestions from the White House to raise revenue through tax increases or expanding Medicare’s ability to negotiate drug prices.

House Speaker Kevin McCarthy (R-Calif.) on Monday said the Medicare suggestion was a way to “disrupt” the negotiations.

“Trying to throw taxes in, now trying to start talking about Medicare? No,” McCarthy told reporters.

Along with the top-line spending levels, the GOP negotiators said the two sides are not close to finding an agreement on work requirements for public assistance programs. Republicans want to beef them up the requirements attached to qualification for Supplemental Nutrition Assistance Program and Temporary Assistance for Needy Families as well as implement new work requirements for Medicaid.

“To be clear, the White House and the president have been hard-drivers on work requirements, and his team has been very difficult on work requirements,” McHenry said.

Though some House Republicans have doubted Treasury Department Secretary Janet Yellen’s projection that the U.S. could default on its debt obligations as soon as June 1, GOP negotiators say they are trying to meet that deadline.

“The backstop that we’re operating under is June 1 until I know better,” Graves said, adding that he feels “significant pressure that we get this done as quickly as possible”

McCarthy says he will stick to the House rule that legislative text must have at least 72 hours for members to review it before there is a vote on the floor. And McHenry said that it will take 24-48 hours to actually write a bill once an agreement is reached. The Senate also needs time to consider and pass the legislation and then send it to President Biden’s desk.

Operating under that timeline, negotiators would have to come to an agreement in the next few days.

It is looking increasingly likely that House members, who are currently scheduled to leave town on Thursday for a weeklong recess for Memorial Day, will be called back to Washington to pass the bill early next week.

“I know people have a lot of Memorial Day events back in their district,” McCarthy told reporters Tuesday. “I would have — depending on where we are at that moment — have them come home and come back.”

Asked whether he has been hearing concern from business executives about debt negotiations, McHenry said: “My texts are a dumpster fire.”