While a perilous American default threatens, Joe Biden tries again on Monday to find a compromise with Kevin McCarthy, his main opponent in a showdown as much budgetary as political.
The contrast could not be stronger between the messages of unity chanted at the G7 summit in Japan, from which the American president has just returned, and the tensions he finds on his return.
The markets didn't really know which foot to dance on Monday. Wall Street opened with no clear direction, with the Dow Jones index yielding 0.02%.
Traders from both sides are meeting this morning to prepare for the interview, according to a source familiar with the matter, but the The White House has so far not given a precise schedule for the meeting between the 80-year-old Democrat and the Republican leader, Kevin McCarthy, who has already received twice in two weeks in the Oval Office.
< p>The two men also spoke on the phone on Sunday. Kevin McCarthy found the conversation “productive”, according to American media, and Joe Biden, who prides himself on being an outstanding negotiator, said that it had “gone well”.
These encouraging signals come after a much less encouraging weekend. The negotiations between the White House team and the Republicans have indeed turned sour.
To remove the risk of bankruptcy, Congress – the Senate held by the Democrats and the House with a Republican majority – must vote to raise the maximum ceiling on authorized public debt.
The Republicans demand , to give the green light, a sharp reduction in public spending. Joe Biden, who is campaigning for re-election in 2024 on a social justice pledge, opposes it.
“Washington can’t keep spending money we don’t have,” launched in a tweet Kevin McCarthy.
The American president warned him that he would refuse any agreement that would “endanger the health care of 21 million Americans” or “food aid” for the most precarious.
If no agreement is found, an unprecedented payment default, with potentially catastrophic consequences for the American and global economy, could occur as early as June 1.
The United States would no longer be able to repay holders of Treasury bonds. The government could also no longer pay certain salaries of civil servants or retirees and veterans, among others.
So who will give in first? The American president, who knows well that a potential economic rout, whatever its political genesis, would compromise his chances of re-election? Or Kevin McCarthy, whose position depends on a handful of elected radicals, who call on him – like former President Donald Trump – not to “bend”?
The left wing of the party Democrat also pushes Joe Biden to be inflexible, and to invoke the 14th amendment to the American Constitution, which prohibits “questioning” the solvency of the first world power.
In short, the American president would force through to issue new loans, as if the debt ceiling did not exist.
Joe Biden is studying this possibility, which is fraught with legal dangers, especially when, like him, we face a Supreme Court firmly entrenched on the right.