‘Shrink the room:’ How Biden and McCarthy struck a debt-limit deal and staved off a catastrophe

by Lucas Garcia
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debt-limit deal

Title: ‘Shrink the Room:’ How Biden and McCarthy Struck a Debt-Limit Deal and Staved Off a Catastrophe


The debt-limit standoff between President Joe Biden and House Speaker Kevin McCarthy posed a significant threat to the U.S. economy. Despite initial disagreements and challenges, both leaders recognized the urgency of reaching a deal to prevent a default. This article explores the behind-the-scenes negotiations and the strategies employed by Biden and McCarthy to avert an unprecedented catastrophe.

McConnell’s Advice: Deal with McCarthy Alone

Senate Minority Leader Mitch McConnell advised President Biden to focus on negotiating with House Speaker Kevin McCarthy, excluding other congressional leaders. Emphasizing the importance of reducing the number of participants, McConnell urged Biden to “shrink the room” to achieve a resolution and avoid an economy-rattling default.

Biden’s Determination and McCarthy’s Leverage

President Biden, having experienced the consequences of a debt-limit fight in 2011, refused to make concessions on Congress’ fundamental responsibility. However, McCarthy, driven by conservative demands for significant changes to federal spending, sought to use the nation’s borrowing authority as leverage, even if it risked default. This clash of perspectives set the stage for a high-stakes negotiation.

Joint Efforts and Trusted Emissaries

Biden and McCarthy eventually adopted a collaborative approach, appointing trusted emissaries to lead the negotiations. A group of five negotiators, empowered by their principals and armed with policy expertise, played a crucial role in bridging the gap. The presence of influential figures like Steve Ricchetti, presidential counselor, and Shalanda Young, director of the Office and Management and Budget, reassured Republicans. The negotiators, meeting daily, meticulously identified priorities and red lines, working towards a mutually acceptable agreement.

Challenges and a ‘Regressive’ Offer

As negotiations progressed, tensions arose due to Republican frustration with the White House’s reluctance to curb federal spending. Republicans considered anything short of spending cuts a nonstarter. When talks hit a roadblock, Republican negotiators decided to go public, expressing their dissatisfaction. They presented a new proposal that revived previously rejected provisions from the GOP’s debt-limit bill, along with a border-security bill. The White House deemed this offer “regressive” and responded with its own frustrations.

Optimism, Late Nights, and Selling the Deal

Despite the public rhetoric and challenges, signs of progress emerged. Biden’s call to McCarthy from Air Force One, as he left Japan, indicated a growing sense of optimism. The negotiators, fueled by caffeine, gummy worms, and burritos, worked tirelessly, often in the Capitol but occasionally at other locations. Late-night sessions and minimal sleep demonstrated their commitment. McCarthy’s decision to send lawmakers home for the Memorial Day weekend helped create a more serious tone among White House negotiators.

Announcement of the Deal and Selling the Agreement

On May 27, Biden and McCarthy announced a deal in principle and began the task of securing support for the agreement. McCarthy gathered House Republicans to explain the details and quell any potential revolt. Simultaneously, the White House addressed concerns from rank-and-file Democrats. Biden and McCarthy approached the agreement differently, with McCarthy openly discussing the negotiations while Biden maintained silence to avoid disrupting the process. White House officials engaged with lawmakers, explained the intricacies of the deal, and sought to address concerns, making more than 130 personal calls.


After bipartisan support in the House, Biden, joined by his team, closely followed the Senate vote while at the Cheyenne Mountain Resort in Colorado Springs. Biden expressed gratitude for the agreement, acknowledging the bipartisan compromise and the responsibility of governing. The successful negotiations between Biden and McCarthy demonstrated their ability to navigate challenges and work towards a resolution, highlighting the importance of personal

Q: What is the debt-limit deal and why is it significant?

A: The debt-limit deal refers to the negotiation and agreement reached between President Biden and House Speaker McCarthy to lift the debt limit, preventing a potential default. It is significant because defaulting on the national debt could have severe economic consequences, affecting the stability of the economy and causing unknown political ramifications.

Q: How did President Biden and House Speaker McCarthy approach the negotiations?

A: Initially, Senate Minority Leader McConnell advised Biden to focus on negotiating with McCarthy alone, excluding other congressional leaders. Biden and McCarthy eventually adopted a collaborative approach, appointing trusted emissaries to lead the negotiations. Both leaders demonstrated determination and worked towards finding common ground.

Q: What challenges did the negotiators face during the debt-limit discussions?

A: The negotiators faced challenges related to differing perspectives on federal spending. Republicans, led by McCarthy, pushed for significant changes to federal spending, while Biden emphasized the responsibility of Congress to fulfill its fundamental duties without conceding to major concessions. Finding a middle ground that satisfied both sides was a key challenge.

Q: How did the negotiators manage to overcome obstacles and reach an agreement?

A: The negotiators, armed with policy expertise and empowered by their principals, engaged in daily meetings to identify priorities and red lines. Despite moments of tension and public frustrations, signs of progress emerged as the negotiations continued. Late-night sessions, dedicated efforts, and sustained communication contributed to reaching a mutually acceptable agreement.

Q: How did President Biden and House Speaker McCarthy gain support for the debt-limit deal?

A: McCarthy gathered House Republicans to explain the details of the agreement and address any concerns, successfully quelling potential opposition. The White House engaged in extensive communication with lawmakers, answering questions, explaining intricacies, and making personal calls to build support. The bipartisan compromise ultimately garnered significant support in the House.

Q: What are the implications of the debt-limit deal and its aftermath?

A: The debt-limit deal, with its bipartisan support, averted a potential catastrophe and safeguarded the economy from a default. The negotiations showcased the importance of collaboration, leadership, and responsible governance in addressing critical issues. The aftermath may test McCarthy’s speakership and his ability to manage a hard-right flank within his party.

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