Biden Vows No Default on Debt, Urges GOP to Find Common Ground
Biden #Biden
(Bloomberg) — President Joe Biden will vow to not allow the US to default on its debt, calling on Congress to raise the debt-ceiling and chastising Republicans who are seeking to leverage the standoff to force spending cuts.
Most Read from Bloomberg
In his State of the Union address on Tuesday, Biden will call for bipartisan congressional breakthroughs as a divided Congress faces a bruising fight over spending cuts and the debt ceiling.
“Republicans say if we don’t cut Social Security and Medicare, they’ll let America default on its debt for the first time in our history. I won’t let that happen,” said Biden, according to prepared remarks.
Biden entered the joint session just after 9 p.m. in Washington to applause and began speaking at 9:08 p.m.
The speech — also a de facto soft-launch of an expected reelection campaign — reprised many familiar Biden themes, including a push to bolster the middle class. In excerpts released Tuesday evening, he urged Congress to come together, despite partisan differences.
New Executive Actions
“To my Republican friends, if we could work together in the last Congress, there is no reason we can’t work together in this new Congress. The people sent us a clear message,” Biden will say in early portions of his speech, according to excerpts. “Fighting for the sake of fighting, power for the sake of power, conflict for the sake of conflict, gets us nowhere.”
The White House signaled that the speech will include a series of new executive actions and a list of proposals to Congress, including raising a tax on stock buybacks, a minimum tax on billionaires, a law banning targeted advertising online for children and young people, and a law to strengthen antitrust enforcement.
Other guests invited by the administration hinted at likely legislative pushes on abortion rights and an assault weapons ban. All are unlikely to pass the current, divided Congress.
Biden touted his accomplishments and legislative victories in the last Democratic-controlled Congress at a time when polls indicate voters are giving him little credit for it. More than six in 10 Americans don’t believe the president has accomplished much during his first two years in office, despite Congress’s passage of major legislation under Democratic control, according to a Washington Post/ABC News poll conducted between Jan. 27 and Feb. 1.
Biden made glancing reference to inflation, which became a major headwind for him and has launched the Federal Reserve on a rate hiking cycle that could eventually trigger a recession. Biden struck an upbeat tone and signaled that he is confident that inflation is receding.
“Unity Agenda”
“We’re better positioned than any country on Earth. But We have more to do, but here at home, inflation is coming down. Here at home, gas prices are down $1.50 a gallon since their peak. Food inflation is coming down — not fast enough, but coming down,” he said.
He will also reprise so-called “unity agenda” efforts from the speech a year earlier, including efforts to curb opioid use and deaths. Biden will announce a diplomatic push to curb the inflow of fentanyl, though it’s not clear if he will single out China, a source of materials used to produce fentanyl.
Biden is navigating heightened tensions with the world’s second-biggest economy, after the downing of an alleged Chinese surveillance balloon on Saturday.
Biden nodded to his push to expand the middle class, and to bipartisan victories, like laws expanding infrastructure spending and subsidizing domestic production of semiconductor chips. He will tailor his economic pitch to smaller communities who’ve seen major businesses shuttered.
“Maybe that’s you watching at home. You remember the jobs that went away. And you wonder whether a path even exists anymore for you and your children to get ahead without moving away. I get it,” Biden will say, according to the prepared remarks. “That’s why we’re building an economy where no one is left behind.”
Biden also urged Congress to implement immigration reform — or at least a slimmed-down version. “If you won’t pass my comprehensive immigration reform, at least pass my plan to provide the equipment and officers to secure the border. And a pathway to citizenship for Dreamers, those on temporary status, farm workers, and essential workers,” he will say.
He also called for police reform, which stalled in the last Congress, by raising the death of Tyre Nichols. The White House invited Nichols’s mother and stepfather as guests to Tuesday’s speech. “Let’s come together and finish the job on police reform. Do something,” he said, according to prepared remarks.
In another excerpt, Biden will stress that the Covid pandemic is largely behind the US and tout job gains — which some analysts say are a headwind to the Federal Reserve’s efforts to ease inflation, and may raise the chances of further rate hikes and a recession.
“We are the only country that has emerged from every crisis stronger than when we entered it,” Biden will say.
Most Read from Bloomberg Businessweek
©2023 Bloomberg L.P.