Treasury Secretary Janet Yellen warned on Monday the U.S. government could run out of funding to pay its bills by the beginning of June if Congress fails to raise the debt limit, urging lawmakers to take action immediately.
Treasury Secretary Janet Yellen warned the U.S. government could run out of cash to pay its debt as ... [+]
In a letter to lawmakers, including House Speaker Kevin McCarthy (R-Calif.) and Senate Majority Leader Chuck Schumer (D-N.Y.), Yellen called on Congress to act “as soon as possible,” arguing the federal government will likely be unable to fulfill its financial obligations “by early June, and potentially as early as June 1,” without action from Congress to raise or suspend the debt limit over the next 30 days.
Yellen also warned that by waiting until the last minute, Congress could risk “serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers and negatively impact the credit rating” of the U.S.
The GOP-controlled House approved a measure along party lines last week to raise the federal government’s $31.4 trillion borrowing limit, though President Joe Biden said he would veto the bill in its current form, and Senate Democrats have named it the “Default on America” (DOA) bill, insinuating it’s dead on arrival.
The Senate is scheduled to hold a hearing Thursday on whether to raise the debt limit, despite Democrats’ opposition to the GOP bill, and as the continued absence of longtime Sen. Dianne Feinstein (D-Calif.) throws a wrench in Democrats’ plans to upend the bill.
House Approves Raising Debt Limit—But Biden Plans To Veto Bill (Forbes)