House Speaker Kevin McCarthy said Wednesday that talks with the White House to raise the U.S. debt limit are still stalled by disagreements over future spending, indicating that the two sides have just eight days left before the government faces an unprecedented default. CNBC, quoted by News.ro.

Concrete cuts in government spending in exchange for raising the debt ceiling are a key demand of Republicans, but so far a red line for the White House.

Increasing the credit limit does not involve new costs.

As the US neared default and possible economic chaos, McCarthy accused Democrats of malfeasance.

“And the solution here is to solve the problem of spending less than we spent last year,” he said during a news conference at the Capitol.

The California Republican has repeatedly pushed the partisan spending bill, which House Republicans passed without a Democratic vote in April, as the only option to raise the debt limit.

“Don’t blame us Republicans when we introduce a sensible bill,” McCarthy said.

Wall Street stocks fell to session lows after McCarthy’s comments as investors closely watched the talks for any signs of progress.

“I think we can make progress today,” McCarthy said, but he ignored questions about whether the talks had made progress in the past 24 hours.

After a week of meeting outside McCarthy’s office, Republican negotiators headed to the White House on Wednesday, where they were to continue talks in a nearby office building.

“The discussions have hit a roadblock,” a Democratic official familiar with the situation told NBC News on Wednesday.

But outside the Beltway, concern has grown about whether McCarthy and President Joe Biden can reach a deal to cut government spending enough to get the Republican votes needed to pass a bill that raises the debt limit by June 1.

Treasury Secretary Janet Yellen said on Wednesday that she already sees “some stress in financial markets” on fears that the US could be headed for its first debt default.

Tensions over the debt ceiling have particularly weighed on Treasury markets, Yellen said at a Wall Street Journal event. These signs of stress “should remind us of the importance of reaching agreement in a timely manner,” she emphasized.

But after a week of daily meetings led by a group of veteran negotiators, people on both sides say the gap between what House Republicans want and what the White House is willing to offer appears wider than ever. (News.ro)