Biden looks to negotiate directly with McCarthy on debt ceiling: Republicans 'have to move as well'

Days after the White House and Republicans spoke optimistically about reaching a deal on the debt ceiling and the federal government's budget, both the president and House speaker on Sunday publicly rebuked the other for placing partisanship over the economy.

President Joe Biden and Speaker Kevin McCarthy are set to resume talks later Sunday, though their latest comments indicated major differences remain between the two sides on the size of any spending cuts and potential new tax revenue.

A potentially catastrophic default looms as soon as June 1 unless the debt ceiling is lifted, Treasury Secretary Janet Yellen has said.

The president had initially resisted negotiating on raising that limit -- saying lawmakers must hike it without preconditions -- but has since agreed to budget talks alongside a debt increase.

Speaking to reporters in Hiroshima, Japan, while meeting with leaders of the Group of Seven countries and allied nations, Biden emphasized that the only deal to be made was through bipartisan negotiations.

Biden hammered Republicans over what he called their "extreme positions" on raising the $31.4 trillion debt ceiling, which was reached in January.

Without the ability to borrow more money, the government will be unable to pay all of its bills within weeks, Yellen has predicted.

"It's time for the other side to move from their extreme positions because much of what they've proposed is quite frankly unacceptable," Biden said in Japan. "It's time for Republicans to accept that there is no bipartisan deal to be made solely on their partisan terms. They have to move as well."

Biden added that it has been "hard to determine where they are, quite frankly" and that he would speak to McCarthy, R-Calif., while traveling back to the U.S.

"I'm not going to agree to a deal that protects, for example, a $30 billion tax break for the oil industry, which made $200 billion last year. They don't need an incentive of another $30 billion, while putting Health care of 21 million Americans at risk by going after Medicaid," Biden said.

McCarthy said earlier this weekend that the debt talks would be paused until after Biden returned from overseas, contending that "the White House moved backwards" during bargaining.

"My guess is he's going to want to deal directly with me," Biden said in Japan. "We're going to have to sit down. I'm hoping that Speaker McCarthy is just waiting to negotiate with me when I get home, which has been -- I don't know whether that's true or not, we'll find out."

It would take several days to turn any legislative deal into law, including moving the bill through Congress and to Biden's desk.

Meanwhile, the clock is ticking down to avoid a default, which would likely upend both U.S. and international markets.

During his press conference Sunday, Biden still expressed confidence that "we can reach an agreement," although minutes later, he said, "I can't guarantee that they [GOP] wouldn't force a default by doing something outrageous."

Pressed about the possibility of default while appearing Sunday on ABC's "This Week," House Budget Committee Chair Jodey Arrington insisted that Republicans had done their part by passing a bill last month to raise the debt ceiling, cut spending and reverse key Biden policies -- a bill that was quickly rejected by Democrats.

"The question is, will President Biden listen to Janet Yellen, his own secretary? And with the window closing on the x-date, the default date, then respond? We've done our job," Arrington said.

"We've got to rightsize and rein in this bureaucratic bloat" while addressing the "spending problem that’s driving the iNFLation crisis and some of the economic woes that we’re experiencing," he said

The president in Japan singled out an impasse over revenue growth, arguing that Republicans are opposed to his proposals to raise some taxes.

He said he is "willing to cut spending, as well as raise revenue, so people start paying their fair share," but that revenues are where negotiators continue to have "significant disagreement."

McCarthy shot back Sunday, insisting that Biden previously acknowledged raising taxes would not be part of any agreement on the debt limit.

"But the president has really shifted right after the more progressive socialist wing of the party stood up and says they want to spend more money. He's now bringing something to the table that everyone said was off the table. It seems as though he wants to default more than he wants to deal," McCarthy said on Fox Business.

Biden commented on Sunday on the possibility of unilateral action, saying he had considered invoking the 14th Amendment, which states that the public debt "shall not be questioned." However, he said that leaning on the amendment to get around the debt ceiling would likely cause a court challenge and a subsequent appeal, a delay that would push the country toward default anyway.

"I think we have the authority," Biden said. "Question is, could it be done and invoked in time that it would not be appealed and, as a consequence, past the date in question, and still default on debt? That's a question that I think is unresolved."

The debt ceiling debate has played out during Biden's trip to Hiroshima to meet with leaders from the G7 and allied countries, making headlines even while the president grapples with issues like sending F-16 fighter jets to Ukraine and relations with China.

The U.S. and other nations broke longstanding vows to not send the planes to Ukraine when they announced this weekend they would start training Ukrainian pilots on the jets and ultimately send some to Kyiv. Western countries had previously been wary of such a move over fears of antagonizing Russia and potentially broadening the conflict in Ukraine.

"I have a flat assurance from Zelenskyy that they will not, they will not, use it to go on and move into Russian geographic territory. But wherever Russian troops are within Ukraine in the area, they would be able to do that," Biden said Sunday, referencing Ukrainian President Volodymyr Zelenskyy.

On China, he added that he expected relations between Washington and Beijing to "thaw very shortly" months after the U.S. shot down what intelligence agencies have said was a Chinese spy balloon, an incident Biden called "silly" on Sunday.

ABC News' Justin Gomez and Lauren Peller contributed to this report.