Former Secretary of Labor Alex Acosta told Newsmax on Monday that he believes President Joe Biden will negotiate on the debt ceiling because the United States "cannot afford" to default on its debts.
"This happens every few years and we're starting to see common ground," Acosta said during an appearance on Newsmax's "National Report." "About a month and a half ago, you spent a lot of time covering [House] Speaker [Kevin] McCarthy's visit to New York, where he said, 'We need to start talking about this and the White House needs to recognize that we're Congress and this needs to be a negotiation.' And, for several weeks, the White House refused to negotiate."
"Now, all of a sudden, the White House is saying, 'We need to hurry to negotiate because this deadline is looming,' " he continued. "To his credit, Speaker McCarthy has been consistent throughout. He said, 'We need to control spending, we need to reduce this spending because it's causing inflation. It's affecting our mortgages, our interest rates. It affects every American when they go to the grocery store.' Now President Biden has finally acknowledged that, in fact, he has to negotiate. I think he will negotiate. I think he has to negotiate. And so they have to find common ground because we cannot afford a default."
Biden and McCarthy are set to meet at the White House Monday afternoon, as Washington works to hammer out a budget compromise and raise the nation's borrowing limit in time to prevent a devastating default.
After a weekend of start-stop talks, both men appeared upbeat as they race to avert a looming debt crisis and the June 1 deadline – when the government could run out of cash to pay its bills – approaches.
The impact of a first-ever default on the federal debt would be felt around the world, according to Mark Zandi, chief economist at Moody's Analytics.
"No corner of the global economy will be spared'' if the U.S. government defaulted and the crisis weren't resolved quickly, Zandi said.
Reacting to the news that Facebook parents company Meta was fined a record 1.2 billion euro ($1.3 billion) by Ireland's Data Protection Commissioner for its handling of user information, Acosta said the situation isn't unique to Meta.
"This isn't the first time it's happened," he said. "Amazon, a little over a year ago, was fined almost $800 million for doing the same thing. And this really highlights that Europe is very protective of its citizens' privacy rights. They are a privacy-first society that takes these issues very seriously."
"And so my question is this: what does the U.S. do?" he continued. "And what does this say about us versus Europe? Are we protecting our own citizens, vis-à-vis, for example, China? In some areas, like healthcare, we're very protective of the privacy of our people and our healthcare data, but TikTok really highlights how the United States is far, far behind Europe and other parts of the world in protecting our privacy."
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