Senate Majority Leader Chuck Schumer is set to meet with the CEOs of major US banks, including Jamie Dimon of JPMorgan Chase & Co. and Jane Fraser of Citigroup Inc., to discuss the looming federal debt limit crisis. The meeting comes as the government is potentially two weeks away from a catastrophic payments default. Treasury Secretary Janet Yellen is also expected to meet with finance chiefs this week, as her department might soon run out of cash necessary to fulfill all federal obligations.
Yellen has previously expressed that it would be beneficial for corporate leaders to vocalize their concerns about the debt ceiling. Dimon has stated that JPMorgan has established a "war room" to strategize contingencies in case the debt limit is not increased on time. The banking executives are in Washington for the Bank Policy Institute's annual meeting, a banking industry lobbying event, which coincides with the intensification of White House and Republican negotiations over a framework to increase the debt ceiling and manage Republican demands for spending restrictions.
Meanwhile, President Joe Biden and House Speaker Kevin McCarthy's negotiators will convene on Wednesday to try to develop details of an agreement that could include spending caps, a clawback of unspent Covid-19 funds, and an expedited permit process for energy and other projects. The meeting comes on the heels of an Oval Office meeting on Tuesday, during which Biden and Congressional leaders from both parties expressed cautious optimism, despite not indicating any policy agreement.
Treasury Secretary Yellen has warned that the Treasury Department might exhaust all means to prevent breaching the debt limit as early as June 1. As these critical discussions are underway, President Biden is set to depart for a Group of Seven meeting in Hiroshima, Japan, and will return on Sunday, cutting short his originally planned extended overseas trip.
