Biden and McCarthy reach final deal to avoid US default

The days ahead will determine whether Washington is again able to narrowly avoid a default on U.S. debt, or the global economy enters a potential crisis

With days to spare before a potential first-ever government default, President Joe Biden and House Speaker Kevin McCarthy reached final agreement Sunday on a deal to raise the nation’s debt ceiling and worked to ensure enough support in Congress to pass the measure in the coming week.

The Democratic president and Republican speaker spoke late in the day as negotiators rushed to draft and post the bill text for review, with compromises that neither the hard-right or left flank is likely to support. Instead, the leaders are working to gather backing from the political middle as Congress hurries toward votes before a June 5 deadline to avert a damaging federal default.

“Good news,” Biden declared Sunday evening at the White House. “The agreement prevents the worst possible crisis, a default, for the first time in our nation’s history,” he said. “Takes the threat of a catastrophic default off the table.”

The president urged both parties in Congress to come together for swift passage. “The speaker and I made clear from the start that the only way forward was a bipartisan agreement,” he said.

The final product includes spending cuts but risks angering some lawmakers as they take a closer look at the concessions. Biden told reporters at the White House upon his return from Delaware that he was confident the plan will make it to his desk. 

McCarthy, too, was confident in remarks at the Capitol, “At the end of the day, people can look together to be able to pass this.”

The days ahead will determine whether Washington is able to narrowly avoid a default on U.S. debt, as it has done many times before, or whether the global economy enters a potential crisis.

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