Kevin McCarthy faces high stakes in debt crisis crunch with potential best and worst outcomes.

Pressure Mounts for Debt Ceiling Compromise

Political and Market Pressure Increases to Raise Debt Ceiling

House Speaker Kevin McCarthy is facing pressure from both the White House and his own party to reach a budget compromise before the projected default date of June 1. McCarthy and President Joe Biden are set to meet on Monday to continue negotiations, but McCarthy is struggling to find support from his own party to pass a joint debt ceiling bill through the House. The best-case scenario for McCarthy is a deal reached on Tuesday, but the worst-case scenario could be a challenge to his speakership.

Conflicting Scenarios for McCarthy

McCarthy could take a hard-line approach to negotiations with Biden and force the president to roll back some of his more left-leaning policies, but Biden has drawn the line in the sand at the Inflation Reduction Act and other areas as nonstarters. Progressive lawmakers have expressed concern and vowed to push back if the bill does not align with their requirements for a “clean” debt ceiling bill. Far-right lawmakers could also stir dissent on Capitol Hill if the bill comes back to Republicans altered far more than they’d like.

Discourse and Negotiations

GOP negotiators walked out of debt ceiling talks with the White House on Friday, saying the meetings were “not productive.” McCarthy and Biden both said their conversation on Sunday was “productive” but that they are not close to an agreement. The speaker is on track for an uphill battle to get at least 200 Republicans in favor of a new debt ceiling bill, and stalling on raising the debt ceiling for a long period of time is projected to create severe financial consequences for the U.S.