Republican Walk Out of Talks

Because of the time it takes a bill to get through the House and Senate, prospects of meeting a hoped for agreement by June 1 date are dwindling. 

On Thursday, House speaker Kevin McCarthy said “I see the path that we can come to an agreement.” 

Sentiment changed overnight. 

Today, CNBC reports Republicans walk out of debt ceiling talks, say White House isn’t being ‘reasonable’.

 “Until people are willing to have reasonable conversations about how you can actually move forward and do the right thing, then we’re not gonna sit here and talk to ourselves,” Rep. Garret Graves, R-La., told reporters.

“We decided to press pause because it’s just not productive,” he added. Graves said he did not know if talks would resume this weekend.

‘We’re Not There’: Negotiators Pause Debt-Ceiling Talks

The Wall Street Journal reports ‘We’re Not There’: Negotiators Pause Debt-Ceiling Talks

The top negotiator to House Speaker Kevin McCarthy (R., Calif.) said that the latest conversations had yielded no progress.

“We’re not there,” said Rep. Garret Graves (R., La.) as he left a meeting with White House officials. “We’ve decided to press pause because it’s just not productive.” Asked if he would be meeting again over the weekend in person, Graves said “I’m not sure right now.”

“The House passed a strong bill. It has great savings in it. And it’s responsible and it puts us on a path to bend the curve,” Graves said. “Until people are willing to have reasonable conversations about how you can actually move forward and do the right thing, then we’re not going to sit here and talk to ourselves,” said Graves, who was flanked by Rep. Patrick McHenry (R., N.C.).

Minutes earlier, White House adviser Steve Ricchetti and Office of Management and Budget Director Shalanda Young had left the meeting without saying when they planned to restart conversations. “Playing by ear,” Ricchetti said in response to a question about whether there would be more meetings Friday.

Trump Urges Hardline Position

The Hill reports Trump urges hardline position as debt ceiling talks paused: ‘Do not fold!!!’

Former President Trump on Friday urged Republican lawmakers to dig in on debt ceiling talks just as negotiations with the White House were paused over disagreements.

“Republicans should not make a deal on the debt ceiling unless they get everything they want (Including the ‘kitchen sink’),” Trump wrote on Truth Social. “That’s the way the Democrats have always dealt with us. Do not fold!!!”

When is the X-date?

Treasury Secretary Janet Yellen said the X-date after which the Treasury may not be able to pay the bills may be as early as June 1. 

I have seen estimates as late as August, even October.

The exact timing of hitting the debt ceiling isnt well known. So we've got to squint at the day-to-day cash flows. Those with sharper pencils than me suggest the low around 6/9 and then quarterly tax payments (6/15) and new extraordinary measures (6/30)https://t.co/oypYOMsf40

— Bob Elliott (@BobEUnlimited) May 17, 2023

August, Perhaps Even October? 

Lets say that takes us to August or so. Once the US hits the debt limit... in reality nothing really happens immediately.

The first most important thing to remember is that the US will not immediately default once the limit is hit. It will prioritize.https://t.co/hiiAWALh4A

— Bob Elliott (@BobEUnlimited) May 17, 2023

If the Treasury can make it until June 9th or 10th, another round of quarterly tax payments is expected on June 15.

With a bit of prioritization in paying the bills, that could stretch things out to August or perhaps even October according to Bob Elliott.

I Highly doubt October, but August may easily be doable with prioritized payments between the X-date and the expected tax receipts.

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