Treasury Secretary Warns Congress U.S. Will Soon Hit Debt Ceiling

Treasury Secretary Janet Yellen warned Congress that the U.S. will reach its statutory debt limit next Thursday. She pled with House Speaker Kevin McCarthy to take the necessary steps to either suspend or increase the debt limit.

In a letter to Congress, Yellen said the Treasury Department will take “extraordinary measures” to fulfill the government’s fiscal responsibilities.

She stated that programs like “Social Security and Medicare benefits, military salaries, interest on the national debt, tax refunds, and other payments,” all are jeopardized if Congress doesn’t increase the debt limit.

“Failure to meet the government’s obligations would cause irreparable harm to the U.S. economy, the livelihoods of all Americans, and global financial stability,” Yellen wrote. “I respectfully urge Congress to act promptly to protect the full faith and credit of the United States.”

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McCarthy asked the White House to grant concessions to the Republican-majority House before raising the debt ceiling. He has asked for a limit on government spending programs.

“It is one of the basic items that Congress has to deal with and that should be done without conditions. So there is going to be no negotiation over it,” White House Press Secretary Karine Jean-Pierre told reporters on Friday. She remarked on the increased debt limit, “this is something that must get done.”

Congress voted to increase the federal debt limit to about $31.4 trillion in December 2021.

“Increasing or suspending the debt limit does not authorize new spending commitments or cost taxpayers money,” Yellen explained in her letter. “It simply allows the government to finance existing legal obligations that Congresses and Presidents of both parties have made in the past.”

Article by Ben Shimkus