President Joe Biden and House Republicans made progress on debt limit talks Tuesday but remained far apart on critical issues.

The two sides agreed to hold direct one-on-one talks between a close ally of House Speaker Kevin McCarthy and two White House aides on Biden's behalf.

"That doesn't mean we're going to get to an agreement," McCarthy told reporters after the meeting, but he said there was "now a better process" overall.

The White House said Biden "directed staff to meet daily on outstanding issues. He said he would like to phone leaders later this week and meet with them upon returning from overseas."

Biden is "optimistic that there is a path to a responsible, bipartisan budget agreement if both sides negotiate in good faith and recognize that neither side will get everything it wants," according to a White House readout of the hourlong meeting.

It was "a good and productive meeting," said Senate Majority Leader Chuck Schumer, D-N.Y., who noted that it was "more cordial" than a previous meeting last week.

"Having a bipartisan bill in both chambers is the only way ... we're going to avoid default," Schumer said.

The White House also said Tuesday that it would cancel the second leg of the president's upcoming international trip, given the delicate state of the debt ceiling negotiations.

Biden is scheduled to depart Wednesday for Japan, where he will attend the Group of Seven summit. He will return to the U.S. on Sunday immediately after the meeting ends and will not make planned visits to Papua New Guinea. Australia, a source familiar with Biden's trip planning told NBC News.

His return will set up a critical stretch to avoid a first-ever default on U.S. debt and prevent significant economic damage.

Recently, stricter work requirements for social safety net programs have emerged as a potential area of compromise.

The work restrictions for social programs are a strong demand of House Republicans, who included them in a partisan debt limit bill that passed that chamber last month.

"The public wants it," McCarthy said Tuesday, citing a recent ballot initiative in Wisconsin. "Both parties want it; the idea that [Democrats] want to put us into a default because they will not work with us on that is ludicrous to me."

But the issue is also a red line for some progressive Democrats, a fact that could scramble the vote math of any debt limit deal that could pass the House.

Increasing the current work requirements for federal assistance programs are "a nonstarter for me," said Rep. Ro Khanna, a California Democrat and member of the Congressional Progressive Caucus, on MSNBC.

"It's just cruel, especially as we see the slowing down of the economy," Khanna said. "I'm hopeful the president will stick to what he said, that we pay our debts, and then we can negotiate on the budget."

Over the weekend, Biden answered a question about the work requirements by pointing to his own Senate record of voting for welfare work requirements in the 1990s.

"I voted for tougher aid programs, that's in the law now, but for Medicaid, it's a different story," Biden said Sunday in Rehoboth, Del. "And so I'm waiting to hear what their exact proposal is."

A Republican bill passed last month included stricter work requirements for Medicaid and the Temporary Assistance to Needy Families, or TANF, funds, and Supplemental Nutrition Assistance Program food stamps.

The White House reiterated Tuesday that Biden would reject some of the proposed work requirements.

Biden "will not accept proposals that will take away people's health coverage," said White House press secretary Karine Jean-Pierre. She did not say, however, that he would not accept changes to food stamps or temporary assistance programs.

The debt limit talks are expected to continue in the coming days.

Key Points

  • The debt limit is the total amount of money the United States government is authorized to borrow.
  • The debt limit has been raised 80 times since 1960.
  • The United States has never defaulted on its debt.
  • A default on the debt would have a devastating impact on the economy.
  • The debt limit talks are expected to be difficult and could last several weeks.

It is important to note that the debt limit differs from the budget deficit. The budget deficit is the difference between the government's spending and revenue. The debt limit is the total amount of money the government can borrow to cover its budget deficit.

The debt limit is a self-imposed limit on the government's borrowing. The Constitution does not give Congress the power to set a debt limit, but Congress has passed laws that do. The debt limit was first imposed in 1917.

The debt limit has been raised 80 times since 1960. The most recent increase was in 2021. The debt limit is expected to be introduced again in 2023.

The United States has never defaulted on its debt. A default on the debt would have a devastating impact on the economy. It would lead to a loss of confidence in the U.S. dollar, making it more expensive for the government to borrow money. It would also lead to higher interest rates, making it more costly for businesses to borrow money and invest. A default on the debt would also hurt the stock market and the housing market.

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