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'Work requirements' emerge as flashpoint in debt ceiling, spending talks

As Washington struggles to reach a debt ceiling deal with little more than a week until potential default, a key hangup in the negotiations is turning out to be -- "work requirements."

A long-sought effort by Republicans to impose stricter conditions on recipients of Medicaid and other federal assistance programs is now front-and-center in the debt ceiling standoff.

MORE: McCarthy tells House Republicans 'nowhere near a deal' on debt, spending

House Speaker Kevin McCarthy has described tougher work requirements as a "red line" in his ongoing negotiations with President Joe Biden to reduce federal spending in exchange for addressing the debt ceiling.

"We want to take people from poverty to jobs. It is only for people who are able-bodied with no dependents," McCarthy told reporters Monday evening after he met with Biden at the White House.

"I don't think it's right that we borrow money from China to pay somebody who has no dependents, able-bodied to sit on a couch," McCarthy added, using a line used by leading Republicans in recent days.

PHOTO: Speaker of the House Kevin McCarthy talks to reporters outside his office following his discussions at the White House with President Joe Biden on the impasse over the government's debt ceiling, at the Capitol in Washington, May 22, 2023. (J. Scott Applewhite/AP)
PHOTO: Speaker of the House Kevin McCarthy talks to reporters outside his office following his discussions at the White House with President Joe Biden on the impasse over the government's debt ceiling, at the Capitol in Washington, May 22, 2023. (J. Scott Applewhite/AP)

Several Democrats, however, have said the GOP's proposed work requirements are a nonstarter.

Here's what to know as talks continue.

How much money would work requirements save?

As McCarthy digs in his heels on work requirements, an analysis from the nonpartisan Congressional Budget Office found the changes outlined in the Limit, Save, Grow Act would reduce federal spending by $120 billion over the next decade.

That's a relatively small amount, just 2.5%, of the $4.8 trillion total the bill is projected to save in costs over that timespan.

The Republican bill would ramp up work requirements for some recipients of Medicaid, Temporary Assistance for Needy Families (TANF) and Supplemental Nutrition Assistance Program (SNAP).

The most savings ($109 billion) would come from the Medicaid changes, which would require able-bodied adults to participate in work-related activities for at least 80 hours per month. The SNAP changes would save $11 billion and TANF changes $6 billion, according to the CBO.

The agency estimated the changes would result, on average, in about 600,000 people becoming uninsured and 275,000 losing SNAP benefits.

What Biden has said

Biden opened the door to considering some work requirements but insisted they wouldn't affect people's health care or any other area of "consequence."

"I'm not going to accept any work requirements that's going to impact on medical health needs of people," Biden said last week. "I'm not going to accept any work requirements that go much beyond what is already -- I voted years ago for the work requirements that exist. But it's possible there could be a few others, but not anything of any consequence."

PHOTO: President Joe Biden meets with House Speaker Kevin McCarthy in the Oval Office of the White House, May 22, 2023 in Washington. (Drew Angerer/Getty Images)
PHOTO: President Joe Biden meets with House Speaker Kevin McCarthy in the Oval Office of the White House, May 22, 2023 in Washington. (Drew Angerer/Getty Images)

MORE: Key sticking points, possible areas of compromise in the debt ceiling showdown

McCarthy subsequently laughed off Biden's comments, saying at a press conference: "Anything that has consequences? This is the senator who voted for work requirements."

Will the issue threaten any deal between Biden and McCarthy?

Several progressive Democrats told ABC News Senior Congressional Correspondent Rachel Scott that additional work requirements were dead on arrival.

"I cannot support work requirements, additional work requirements, which are just going to take away benefits," said Rep. Ro Khanna, D-Calif.

Rep. Alexandria Ocasio-Cortez, D-N.Y., when asked if she would support stricter requirements, gave a flat out "no." Rep. Jamaal Bowman, another New York Democrat, also shut down supporting such provisions.

"It's really taken aback for me and many of our colleagues that have seen the same people that are now jumping up and down and saying, We got to do all these things. Why didn't you say it when the previous president was there?" Rep. Rashina Tlaib, D-Mich., said.

Progressives and conservative hardliners have voiced opposition to the ongoing talks between Biden and McCarthy. That means both leaders will need the moderates in both parties to back whatever deal emerges.

"I think there might be some common ground and a modicum of change to other programs. If that's what it takes to avoid default, the tragedy of default will affect millions of lives instantaneously. And that's what we're gonna have to weigh sadly," said Rep. Dean Phillips, a moderate Democrat from Minnesota.

When I asked if he is open to stricter work requirements, Phillips replied, "I'm open to anything at this point, to avoid default."

'Work requirements' emerge as flashpoint in debt ceiling, spending talks originally appeared on abcnews.go.com