In a letter sent to Congressional leaders Friday afternoon, Treasury Secretary Janet Yellen called the “extraordinary measures” aimed at preventing the debt ceiling from being hit as early as Jan. 14. , that is, it is necessary to initiate special accounting measures. .
“Treasury expects to reach the statutory debt ceiling between January 14 and January 23,” Yellen said in a letter to House and Senate leaders, at which point the government The government said it would take extraordinary measures to prevent the country from exceeding its debt ceiling. Activity will be suspended until January 1st.
The ministry has in the past deployed so-called extraordinary measures, or accounting maneuvers, to keep the government running. But once those measures expire, the government risks default unless lawmakers and the president agree to lift restrictions on the U.S. government's ability to borrow.
“I humbly ask Congress to act to fully protect the trust and confidence of the United States,” she said.
The news comes after Joe Biden signed a bill last week that avoids a government shutdown but does not include President Donald Trump's core debt demands of raising or suspending the national debt ceiling. The bill was first approved by Congress after intense debate within Republicans over how to address Trump's demands. “Any other action would be a betrayal of our country,” President Trump said in a statement.
After a lengthy debate in summer 2023 over how to fund the government, policymakers crafted the Fiscal Responsibility Act, which includes suspending the country's $31.4 trillion borrowing authority until Jan. 1. .
Notably, however, Yellen predicted a temporary reduction in debt on January 2nd due to scheduled redemptions of non-marketable securities held by federal trust funds related to Medicare payments. That's what I said it would do. As a result, “[the] “Treasury does not believe it is necessary to begin taking extraordinary measures starting January 2 to prevent the United States from defaulting on its obligations.”
The federal debt now stands at about $36 trillion and has ballooned across Republican and Democratic administrations. And soaring inflation after the coronavirus pandemic will raise borrowing costs for the government, meaning debt service payments next year will exceed national security spending.
Republicans, who will take full control of the White House, House and Senate in the new year, have big plans to extend President Trump's 2017 tax cuts and other policy priorities, but how they will pay for them remains unclear. We are discussing.
