United States: United States President Mr. Joe Biden has issued a warning that if Republicans do not agree to increase the debt ceiling before a looming deadline, the country’s economy could slip into a recession and result in the loss of millions of jobs.

In a campaign-style speech in New York, Mr. Biden accused Republicans of holding the economy hostage by demanding “devastating” spending cuts in exchange for raising the debt limit.

“We’re bringing jobs back all across America. This is no time to put all this at risk, to threaten a recession, to put at risk millions of jobs, to undermine America’s standing in the world,” Mr. Biden stated at an event in Valhalla, New York, which is home to a congressional district that Republicans narrowly won in mid-term elections in November.

The Biden administration and congressional Republicans have struggled to find common ground on raising or suspending the debt ceiling in order to prevent the US from defaulting on its debt within weeks. The US Treasury Department has indicated it may be unable to pay its bills as soon as June 1.

Republicans have insisted they will only support raising the debt limit if Mr. Biden agrees to retroactive spending cuts, while the President wants to negotiate the budget separately.

In April 2023, House Republicans passed a plan seeking $4.5 trillion in deficit savings by cutting spending, scrapping tax breaks for clean energy, and reversing the president’s plan to forgive student debt.

Mr. Biden and congressional leaders are to meet on May 12 to discuss how to avert an impending default crisis after failing to reach a breakthrough earlier in the week.

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