U.S. May Hit Debt Limit Again on Dec.15, Says Treasury Secy
The U.S. government could run out of money by Dec. 15, Treasury Secretary Janet Yellen warned on Tuesday in a letter urging lawmakers to raise the country’s debt ceiling to avoid default.
Democrats and Republicans in Washington have fought in recent months to increase the legal limit on the amount of debt the United States can accumulate.
In October, they came days after hitting the cap before agreeing to an interim increase of $ 480 billion, which Yellen said would keep the government in place until December 3.
In a letter to House Speaker Nancy Pelosi, the Treasury Secretary extended her forecast of when the deadline would be reached by approximately two weeks. But she warned: “there are scenarios in which the Treasury would end up with insufficient remaining resources to continue funding US government operations beyond that date.”
âTo ensure the full confidence and credit of the United States, it is essential that Congress increases or suspends the debt limit as soon as possible,â Yellen wrote.
The latest tangle comes amid long-running negotiations over Democratic President Joe Biden’s âBuild Back Betterâ plan to invest $ 1.85 trillion in social welfare services and education in the United States.
The Republican minority in Congress opposes the measure and has said it will not agree to raise the debt ceiling to pay it off, although much of the debt incurred by the U.S. government is spending. approved by previous Democratic and Republican administrations.
In October, they argued that Democrats who run the House and Senate should increase the limit unilaterally, before finally lifting their blockade to allow the temporary increase to pass.
The United States has never defaulted on its debt and its treasury bills play a major role in the global financial system, but economists warn that failure to raise the ceiling would trigger a massive financial crisis.
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