Amid a developing stalemate in Congress on the matter, Treasury Secretary Janet Yellen issued a warning to legislative leaders that the United States is expected to approach its debt ceiling on January 19.
On Friday, the treasury secretary warned congressional leaders that the department would start taking “exceptional steps” the next week to postpone the time when the government is anticipated to run out of money.
According to projections, the national debt will surpass its $31.4 trillion ceiling on January 19 in a letter to congressional leaders from Treasury Secretary Janet Yellen Friday. She also cautioned that the restrictions are only temporary and that the department will take steps to prevent a default, which has never happened in the country’s history.
Therefore, Yellen stated, “It is essential that Congress act promptly to raise or suspend the debt ceiling.” Failure to fulfill the government’s responsibilities would have a severe negative impact on the American economy, all Americans’ lives, and the stability of the global financial system.
The letter comes as a debt limit impasse has been developing in Congress, with some Republicans showing interest in leveraging the potential default by requesting expenditure cutbacks while leveraging the new GOP House majority. However, House Speaker Kevin McCarthy claimed that he and President Joe Biden recently had a “really positive chat” in which he requested an early meeting to resolve the standoff. McCarthy made this claim at a news conference on Thursday.
Karine Jean-Pierre, the press secretary for the White House, told reporters on Friday, “We feel that when it comes to the debt limit, it has been done in a bipartisan approach over the years and decades.” And it ought to be done in an unbiased manner. And it ought to be carried out without hesitation. This is crucial in this case.
While encouraging Congress to “act expeditiously,” Yellen said that it is still doubtful that cash and the emergency measures will run out before early June.