Biden, McConnell Remain at Odds Over Extending Debt Ceiling as Possible Default Looms

President Joe Biden scolded Republican senators on Monday, attempting to clear the way for Democrats to suspend the nation's debt limit on their own if needed, the Associated Press reported.

"They need to stop playing Russian roulette with the U.S. economy," Biden said at the White House. "Republicans just have to let us do our job. Just get out of the way. If you don't want to help save the country, get out of the way so you don't destroy it."

Tensions between the parties continue to rise as the October 18 deadline to allow more borrowing approaches so that the government can continue operation, even with a total public debt of $28.4 trillion.

As the government comes critically close to a credit default, Senate Minority Leader Mitch McConnell still does not support Biden's multitrillion-dollar tax and economic agenda, which Biden said will be paid for by raising taxes on corporations and wealthy citizens earning $400,000 a year.

McConnell refused to lend his party's help, saying in a letter he wrote Monday that the Republican Party has already tried to warn the rest of the government of what was to come.

"We have no list of demands. For two and a half months, we have simply warned that since your party wishes to govern alone, it must handle the debt limit alone as well," McConnell said.

For more reporting from the Associated Press, see below.

Tension rises as U.S. nears debt ceiling
As the government comes critically close to a credit default, Senate Minority Leader Mitch McConnell still does not support President Joe Biden's multitrillion-dollar tax and economic agenda. Above, Biden speaks on the debt ceiling during an event in the White House on October 4, 2021, in Washington. Evan Vucci/Associated Press

The House has passed a measure to suspend the debt limit, but McConnell is forcing Senate Democrats into a cumbersome process that could drag on for weeks and brush up against a deadline with little margin for error.

Biden and McConnell have promised the country will avoid default, yet the public fight and political posturing risks an economic meltdown. The global economy relies on the stability of U.S. Treasury notes, and unpaid debt could crush financial markets and hurl America into recession. Biden said the debt limit applies to borrowing that has already occurred, including under former President Donald Trump, and that Republicans are hurting the country by blocking the suspension.

Once a routine vote, the need to raise the nation's debt limit has become increasingly partisan. It's become a favorite political weapon of Republicans to either demand concessions or force Democrats into unpopular votes to enable more borrowing.

The financial markets have stayed relatively calm with interest rates on 10-year Treasury notes holding just below 1.5 percent. That rate is slightly higher than the all-time lows set last year as the coronavirus pandemic spread, but it's still lower than at any other time over nearly 60 years of data tracked by the Federal Reserve.

Treasury Secretary Janet Yellen has said the government will exhaust its cash reserves on October 18, an event she said would likely trigger a financial crisis and economic recession. Senate Majority Leader Chuck Schumer warned on Monday that it would be hazardous for the economy to come anywhere near that deadline.

"The consequences of even approaching the X date could be disastrous for our economy and devastating to American families, raising the costs of borrowing for average Americans and hampering our economic recovery over the long-term," Schumer said in a letter to Democratic senators.

Democrats and Republicans are in a standoff over how to handle an extension for the debt ceiling. Republicans are insisting that Democrats go it alone with the same legislative tool that is already being used to try and pass Biden's plan to boost safety net, health and environmental programs. Democrats say that extending the debt limit has traditionally been a bipartisan effort and that the debt cap was built up under presidents from both parties.

Schumer said that if the debt issue is not resolved this week, the Senate will likely be forced to remain in session during the weekend and possibly the following week when senators were scheduled to be back in their home states.

Schumer also discussed the current state of play with the bipartisan $1 trillion infrastructure bill that has already passed the Senate and is stuck in the House, as well as Biden's larger, $3.5 trillion effort focused on social programs and the environment that would be offset by tax increases on corporations and the wealthy. He noted that the president visited with House Democrats on Friday to generate support for both measures.

"He encouraged them to stick together, compromise, and find the sweet spot that will allow us to complete our work," Schumer said. "I agree with his sentiment wholeheartedly—we can get this done, together, if we put aside our differences and find the common ground within our party."

Biden will be traveling to Michigan on Tuesday to promote his legislative plan as negotiations resume in Washington. Democratic Senators Joe Manchin of West Virginia and Kyrsten Sinema of Arizona have said they won't back a $3.5 trillion spending bill. And many House Democrats won't support the smaller bipartisan infrastructure plan until they get an agreement on the larger measure.

Biden, McConnell Debt Ceiling
Senate Minority Leader Mitch McConnell still does not support President Joe Biden's multitrillion-dollar tax and economic agenda. Above, McConnell walks to the Senate floor at the U.S. Capitol on September 27, 2021, in Washington. (Photo by Drew Angerer/Getty Images)