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Tags: rosen | debt | negotiation | reality

Between Fiction and Reality: How Biden Team Spun Debt Ceiling Talks

James Rosen By Thursday, 01 June 2023 02:25 PM EDT Current | Bio | Archive

Minutes after the House passed the Fiscal Responsibility Act of 2023, the 99-page bill that suspends the debt ceiling for two years and imposes modest caps on federal non-defense discretionary spending, President Joe Biden issued a statement declaring that neither side got everything it wanted — the essence, the chief executive said, of "the responsibility of governing."

Reflecting background whisperings from aides to the president, Politico proclaimed the House vote "a major victory for Biden." Such messaging contrasted sharply with the prevailing line from the White House ahead of the House vote, when the president described for reporters his aversion to any displays of triumphalism.

"Why would Biden say what a good deal it is before the vote?" he asked rhetorically, referring to himself in third-person, during a five-minute exchange with reporters Monday night. "You think that's going to help me get it passed? No. ... You guys don't bargain very well."

The more recent claims of "major victory" by the president's aides have focused on what appears, as of this writing, to be his success in averting the country's first ever default on its debt, and the relative modesty of the spending cuts embedded in the House-passed measure.

Yet, such claims omit, of necessity, a central fact about the debt ceiling drama: how the chief executive was slowly drawn, inch by inch, into exactly the kind of negotiation he said he would never entertain.

White House press secretary Karine Jean-Pierre laid down the marker early on. "We have said very loud and clear to the speaker, if he has any ideas on how to work together on [deficit reduction], we're willing to listen and work in good faith," she said in the Feb.  2 press briefing.

"When it comes to lifting the debt ceiling, that is a completely separate issue…The debt ceiling needs to be lifted without conditions.

"I'm happy to meet with [House Speaker Kevin] McCarthy, but not on whether or not the debt limit gets extended. That's not negotiable," the president reaffirmed to reporters during a Rose Garden news conference with South Korean President Yoon Suk Yeol on April 26 — the same day the House passed the GOP's own debt-and-budget measure, the Limit, Save, Grow Act of 2023.

As May dragged on, however — and Treasury Secretary Janet Yellen identified June 1 (later June 5) as the "X date" on which the U.S. would, in the absence of a deal, begin defaulting on its debt — the White House capitulated on this crucial point about what would, and would not, be up for negotiation.

After opening talks with all four congressional leaders and their staffs, Biden and McCarthy ultimately appointed their own teams of negotiators; their work focused precisely on what the White House had long insisted it would resist: a compromise package that linked a hike to the debt ceiling with cuts in federal spending.

On May 18, with the president attending the G-7 summit in Hiroshima, Japan, the White House released a background statement, attributable to senior administration officials, that all but conceded the fundamental shift in the president's negotiating posture.

"The President requested and received an update this morning from his designated negotiating team," the statement said, "on progress being made in their talks on Capitol Hill to arrive at a bipartisan budget framework and ensure that Congress acts in time to avoid default."

The formulation treated as an established fact that the "talks" had two objectives: addressing the budget and the debt at the same time, the two issues now inextricably entwined.

In their on-camera pronouncements throughout the process, however, senior White House officials remained unwilling to admit that Biden had abandoned his demand for a "clean" hike to the debt ceiling, with no budgetary strings attached.

"We are negotiating on the budget," Jean-Pierre told reporters at the May 23 briefing. As for the debt ceiling part of the talks, Jean-Pierre insisted that the president "has always seen this as ... two separate conversations, two separate discussions."

Those comments prompted this reporter — already informed by sources close to the process that the terms under which the debt ceiling would be raised were also under discussion between the two negotiating teams — to seek clarity on the point.

Rosen: Do you mean to tell us that in the discussions between the president and the speaker, and in the discussions between the two negotiating teams, they are only discussing federal discretionary spending and that they are not at all discussing the terms under which the debt ceiling would be raised?

Jean-Pierre: What I can tell you is what you've heard from the president and what you've heard from both sides, which has been: The negotiation has certainly been about the budget. ... The president has held the line and has been very clear that the debt — when it comes to the debt limit, it should be done without negotiations, without condition. That's something that the president has said in front of all of you. And he also said —

Rosen: But I want to know what's happening in the actual rooms.

Jean-Pierre: I just — I just told you.

Rosen: They're not talking about the debt ceiling, about how long —

Jean-Pierre: I just told you —

Rosen: — It would be raised, by how much? That's not a subject of discussion?

Jean-Pierre: I — I — well, first of all, I — I am telling you what the president has said to all of you.

Rosen: I know what he said. I follow him very closely every day.

Jean-Pierre: OK — OK — OK. Well — well then — I —

Rosen: I want to know what's happening in that room.

Jean-Pierre: The president has spoken to what he has said to the leaders in that room, to what he has said to Speaker McCarthy in the room. And he's been very clear. And, so, he has said, when it comes to the debt limit, it is not negotiable, it should be done without conditions. That's what he has said, that he has been very clear, when it —

Rosen: But is he living up to that in these talks?

Jean-Pierre: Well, I will also remind you that yesterday the speaker and the president said, when it comes to default, it is off the table. And I'll leave it there.

When my Newsmax colleague, congressional correspondent Kilmeny Duchardt, related the substance of my exchange with Jean-Pierre to Rep. Patrick McHenry (R-N.C.), the Financial Services Committee chairman tapped by McCarthy to serve as one of the Republicans' lead negotiators, the bow-tied lawmaker roared with derisive laughter before Duchardt could even finish the question.

"All I can do is laugh. ... This is real reality, and their team is negotiating so we can pass a debt ceiling increase," McHenry said. "They can call it whatever the hell they want, but the American people know this is called a negotiation."

Yet, one of the president's lead negotiators, Shalanda Young, director of the White House Office of Management and Budget, soon showed that she harbors very different ideas about how to define "negotiation."

This became clear when Young faced the White House press corps at the briefing of May 30, just as the House Rules Committee began the review that resulted in the compromise package being advanced to the full House for consideration.

Rosen: It seems to me, in the context of these negotiations, that the White House has been clinging to a fiction, which is that this deal only was negotiated on the basis of the federal discretionary spending and that the president — who promised all along that he would never negotiate on the debt ceiling — didn't do so in these negotiations. That's false, right? The president and his team, you included, did negotiate on the actual debt ceiling itself and not just the federal discretionary spending, correct?

Young: If you're asking me what was said in the room, I'll be very clear: The debt ceiling was a — what did I say earlier? I don't like to use the word "red line," but the debt ceiling had to be taken care of for a long period of time.

The reporter's attempt at interjection was rebuffed by Young, an assured presence at the lectern who, through long experience on Capitol Hill, had forged relationships with scores of lawmakers from both parties.

"You can call it a negotiation," she said. "I call it a declarative statement. And that was our position, and that's what's in the bill."

James Rosen is the chief White House correspondent for Newsmax and has covered the State Department, Capitol Hill, the Supreme Court and the Pentagon. For more of his reports, Go Here Now.

© 2023 Newsmax. All rights reserved.

Claims of a "major victory" by President Biden aides have focused his success in averting the country's first ever default. Such claims, however, omit the central fact that the chief executive was slowly drawn, inch by inch, into exactly the kind of negotiation he said he would never entertain.
rosen, debt, negotiation, reality
Thursday, 01 June 2023 02:25 PM
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