Investors Should Be Worried About Debt Ceiling Deadlock: House Speaker

House Speaker Rep. Kevin McCarthy (R-Calif.) expressed his concern on Wednesday that investors should worry about the deadlock in Washington over raising the debt ceiling. As the United States moves closer to a possible debt default, it has been warned by both Democrats and Republicans that it will be terrible for the economy.

McCarthy shared in an interview with Bloomberg TV on Wednesday that he is “very concerned” about President Joe Biden’s refusal to negotiate with Republicans about cutting government spending in exchange for GOP support to raise the debt ceiling.

“Unfortunately, I tried to sit down with the president, and the president doesn’t want to communicate,” McCarthy said. He added that since a meeting with Biden on Feb. 1, the only form of communication on the debt ceiling between the two has been through letters.

Republicans have been working on a proposal to reduce the deficit, and McCarthy suggested that after Congress returns from recess later this month, there may be “some news” regarding this matter.

When asked whether he plans to speak to investors about the GOP proposal to reassure markets, McCarthy stated that Wall Street is right to be worried.

“They should be concerned,” McCarthy said, adding that since Biden hasn’t wanted to meet, communication between the two is “just these letters.”

McCarthy and Biden Trade Jabs

In his letter to the president, McCarthy warned that Biden’s refusal to negotiate spending cuts to get GOP backing on raising the debt ceiling “could prevent America from meeting its obligations and hold dire ramifications for the entire nation.”

“With each passing day, I am incredibly concerned that you are putting an already fragile economy in jeopardy by insisting upon your extreme position of refusing to negotiate any meaningful changes to out-of-control government spending alongside an increase of the debt limit,” McCarthy wrote.

Biden replied to McCarthy, saying that he’s prepared to consider Republican proposals for spending cuts as part of a budget plan but that such discussions must be separate from “prompt action on the Congress’ basic obligation to pay the nation’s bills and avoid economic catastrophe.”

Failure to reach an agreement over the debt ceiling could lead to a default on U.S. debt obligations, an outcome that many economists have warned would be disastrous.

Rather than negotiating with the GOP on spending cuts as part of raising the debt ceiling, Biden and his Democrat allies in Congress have demanded that Republicans make their spending-cut proposals public.

“I shared my budget with the American people on March 9, 2023,” the president wrote in the letter. “My hope is that House Republicans can present the American public with your budget plan before Congress leaves for the Easter recess so that we can have an in-depth conversation when you return,” Biden added.

“Pretty Good Negotiating Tactic”

McCarthy has so far declined to present the GOP budget proposal, and Republicans h