Treasury Secretary Janet Yellen is urging Congress to behave because the debt ceiling deadline approaches.
In a letter to Speaker of the Home Mike Johnson, Yellen says the federal government will probably attain its debt restrict someday in January, largely due to obligations associated to Medicare funds – forcing the federal government to take “extraordinary measures” to pay its payments.
The Treasury has beforehand used the time period “extraordinary measures” to consult with suspending investments in sure entitlement packages, pausing gross sales of Authorities Collection treasury securities and different accounting maneuvers to maintain the federal government working.
Says Yellen,
“Treasury at the moment expects to achieve the brand new restrict between January 14 and January 23 at which period will probably be obligatory for Treasury to start out taking extraordinary measures.
I respectfully urge Congress to behave to guard the complete religion and credit score of the US”
At time of writing, the US nationwide debt is at the moment at $36.28 trillion. The federal government spent practically $1 trillion merely to service the curiosity on the debt in fiscal yr 2024, which ended final yr on September thirtieth, in keeping with the Congressional Funds Workplace (CBO).
In a current interview on the Wall Road Journal’s CEO Council Summit, Yellen expressed remorse about not with the ability to enhance the US fiscal state of affairs.
“I’m involved about fiscal sustainability, and I’m sorry that we haven’t made extra progress. I consider that the deficit must be introduced down, particularly now that we’re in an atmosphere of upper rates of interest.
For instance, over the past yr the curiosity price of the debt has elevated by a number of hundred billion. It’s one of many largest objects answerable for the rise within the funds deficit. And we do must carry it down. The first deficit excluding curiosity is now somewhat over 3% and I consider it wants to come back down.”
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