Extraordinary measures’ needed by mid-January to keep US from defaulting on national debt, Treasury Secretary Janet Yellen warns Congress

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Posted on 12/27/2024 6:24:48 PM PST by thegagline

“Extraordinary measures” will be needed to keep the US from defaulting on its obligations if the nation’s debt ceiling isn’t raised or suspended by mid-January, Treasury Secretary Janet Yellen warned Congress Friday.

Yellen, in a letter to House and Senate leaders, noted that the nation’s debt ceiling — the total amount of money the federal government is authorized to borrow to pay for obligations such as Social Security and Medicare benefits — was suspended in June 2023 but will once again be in effect on Jan. 1. ***.

“Treasury currently expects to reach the new limit between January 14 and January 23, at which time it will be necessary for Treasury to start taking extraordinary measures,” Yellen wrote.

*** Republicans will hold slim majorities in both the House and the Senate next year, but hard-line members of the GOP caucus staunchly opposed last year’s successful effort to suspend the debt limit.

The so-called Fiscal Responsibility Act of 2023, negotiated by President Biden and former House Speaker Kevin McCarthy (R-Calif.) over Memorial Day weekend, passed the lower chamber in a 314-117 vote, with 71 Republicans joining 46 Democrats in opposing the measure.

The McCarthy-backed bill, which also limited non-defense discretionary spending to 1% annual growth and clawed back tens of billions of dollars in unspent COVID-19 relief funds, needed substantial Democratic support to pass.

Meanwhile, President-elect Donald Trump has already signaled his support for abolishing the debt ceiling altogether.

Eliminating the nation’s debt limit would be the “smartest thing [Congress] could do. I would support that entirely,” the incoming president told NBC News last week. ***

(Excerpt) Read more at nypost.com ...

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1 posted on 12/27/2024 6:24:48 PM PST by thegagline

To: thegagline

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