WH, Dems Fire Back at McCarthy's Wall Street Speech

House Speaker Kevin McCarthy, R-Calif., delivered a rebuke of President Joe Biden and Democrats' call for an unconditional raising of the U.S. debt ceiling, but the White House and Democrats fired back, setting up a showdown in Washington, D.C.

"Mr. President, with all due respect, enough is enough," McCarthy told the New York Stock Exchange on Monday morning. "This is not how the leader of the free world should act. Your partisan political games are provoking the very crisis you claim you want to avoid: greater dependency on China, increasing inflation, and threatening Medicare and Social Security."

Before McCarthy's speech, the White House preemptively fired off a statement blaming the House GOP leader for "brinkmanship or hostage taking" on Biden administration and Democrat demands, without negotiation, of raising the debt ceiling unconditionally and without cutting the Democrats' massive domestic spending initiatives.

"There is one responsible solution to the debt limit: addressing it promptly, without brinksmanship or hostage taking — as Republicans did three times in the last administration and as Presidents Trump and Reagan argued for in office," White House deputy press secretary Andrew Bates said in a statement Monday morning, according to myriad reports.

"Speaker McCarthy is holding the full faith and credit of the United States hostage, threatening our economy and hardworking Americans' retirement."

A White House tweet after the speech echoed those remarks, attempting to demonize fiscal conservatives with an anti-Trump trope.

"As President Biden continues to fight against inflation, MAGA Republicans in Congress are trying to take our economy hostage unless we gut programs that lower costs for hard-working Americans," the White House tweet read.

Congress' fiscal conservatives, led by McCarthy, say the first way to get out of debt is to cut spending, while Democrats have promised to increase it.

"Speaker McCarthy insists on cuts," Senate Majority Leader Chuck Schumer, D-N.Y., said Monday. "Well, there's a time to discuss what kind of cuts folks are looking for or taxes they want to raise. It's called the budget. It shouldn't be part of this conversation.

"President Biden and I are happy to meet with the speaker when he has something to talk about. He went all the way to Wall Street and gave us no more detail. No more facts, no new information at all."

Schumer said Democrats want to avoid default and do not want to negotiate spending cuts to do it.

"One thing is clear from this morning's theater at the New York Stock Exchange: Democrats want to avoid defaulting on our country's debts," Schumer added. "Meanwhile, Speaker McCarthy continues to bumble our country toward a catastrophic default, which would cause the economy to crash, cause monumental job loss, and drastically raise costs for the American people."

McCarthy's Wall Street address came with Washington heading toward a potential fiscal crisis over the need to raise the nation's debt limit, now at $31 trillion, and avert a federal default.

McCarthy said nation's debt load is a "ticking time bomb" and Biden is "missing in action" as the deadline nears to raise the debt limit.

"Let me be clear: A no-strings-attached debt limit increase will not pass," McCarthy said during his speech. "But since the president continues to hide, House Republicans will take action.

"Defaulting on our debt is not an option," McCarthy said.

The plan laid out thus far by Rep. Garret Graves, R-La., as directed by McCarthy, will seek to limit budget spending to a 1% raise annually for 10 years.

Among the other features:

Pull back unspent COVID-19 pandemic funds.
Stop student debt forgiveness.
Repeal some green tax credits.
Work requirements for social programs.
Pass House GOP energy plan (HR 1).
Pass REINS Act, which aims at curbing government regulation.

The proposals are what the House GOP will use as a starting point for negotiations with Biden on raising the debt limit.

White House deputy press secretary Andrew Bates called those a "MAGA wish list that will increase costs for hard-working families."

"A speech isn’t a plan, but it did showcase House Republicans' priorities," Bates added.

Federal spending skyrocketed during the COVID-19 crisis, rising to $7.4 trillion in 2021 and remaining higher than income at $6.2 trillion in fiscal 2022, according to Treasury Department data.

A new report from the nonpartisan Congressional Budget Office has the federal deficit chugging higher at $1.1 trillion in just the first six months of fiscal year 2023, which began in October.

The revelation continues to debunk the Biden administration claim that Biden is reducing the deficit. The oft-repeated claim was based on data that Biden's administration merely slowed the increase of the national debt after massive COVID-19 pandemic spending packages in prior years.

The $1.1 trillion in the first half of 2023 is $430 billion more than the 2022 increase over the same period, bringing the national debt to around $32.5 trillion.

Biden spending increased 13% ($357 billion) with $3.1 trillion spent in six months, while revenues fell 3% to $2 trillion. That latter figure is $73 billion less than the first half of 2022, according to the report.