U.S. Treasury Secretary Janet L Yellen reportedly mentioned on Friday that the federal government has lower than three weeks to boost its debt restrict.
What Occurred: Until the federal government raises its debt restrict, it might want to take “extraordinary measures” to maintain federal operations beginning between Jan. 14 and Jan. 23, Yellen mentioned in a letter to members of Congress, as reported by The Washington Publish.
The federal government is beginning to run out of cash to finance its debt obligations, she famous whereas urging Congress to behave.
Why It Issues: The debt ceiling refers back to the restrict of how a lot the Treasury can borrow. Failing to boost it dangers a authorities default, jeopardizing applications like Social Safety, Medicaid, and housing help. A default may additionally spike rates of interest, because the U.S. would possibly lose its repute as a creditworthy borrower.
Earlier this month, President-elect Donald Trump known as for both elevating or fully eliminating the borrowing restrict, a transfer that would resolve the problem earlier than he assumes workplace and permit him to pursue his agenda with out future debt-ceiling battles.
“Congress should do away with, or lengthen out to, maybe, 2029, the ridiculous Debt Ceiling,” Trump wrote in a Reality Social publish. “With out this, we must always by no means make a deal. Bear in mind, the strain is on whoever is President.”
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