Biden Condemns GOP For 'Holding The Economy Hostage' Amid Debt Ceiling Crisis, Says US Default Not An Option

President Joe Biden addressed the debt ceiling crisis on Wednesday, stating that Republicans are "holding the economy hostage," by threatening a default on U.S. debt. 

They want "huge cuts to important programs for millions of working middle-class Americans," and "21 million people will be at risk of losing Medicaid," Biden told supporters while speaking at Westchester Community College in Valhalla, N.Y. 

The President warned that eight million people are at risk of losing their jobs if the U.S. defaults on its obligations, citing a Moody's study. He added that the U.S. international reputation will be damaged in the extreme. 

"This is a manufactured crisis. America is not a deadbeat nation. There is no question the U.S. is going to pay its bills, stating that default is not an option," the president said.

Biden stated that the national debt has increased by 40% in the four years prior to his presidency, adding that the Trump tax cuts were skewed toward the wealthy and large corporations. 

The speech came a day after Biden had a "productive" meeting with key congressional leaders, although no bipartisan agreement on raising the debt ceiling was reached.

Earlier this week, U.S. Treasury Secretary Yellen warned that the government had only a few weeks left before it runs out of cash, with the June 1 deadline looming.

Also Read: 5 Economists On April Inflation Data: CPI Number Has Experts Joining Fed Pause Bandwagon

Market Reaction:

The SPDR S&P 500 ETF Trust SPY rose by 0.5% during the Biden's speech, paring back losses for the session.