Treasury Secretary Janet L. Yellen said on Friday that if legislators did not act to extend the statutory debt ceiling, she would have to start using "extraordinary measures" on Thursday to keep paying the country's bills and that her options for preventing a default may run out by early June.
The first indication that House Republicans' opposition to raising the borrowing limit would put the American economy at danger came in Ms. Yellen's letter to Congress, which also marks the start of a heated debate in Washington this year over spending and deficits.
“Failure to meet the government’s obligations would cause irreparable harm to the U.S. economy, the livelihoods of all Americans and global financial stability”
On Friday, Ms. Yellen stated that there was a lot of ambiguity on how long she could utilize the measures to prevent a default. She declared that in order to stay within the debt ceiling, she would start this month by stopping new investments in the Civil Service Retirement and Disability Fund, the Postal Service Retiree Health Benefits Fund, and the Federal Employees Retirement System Thrift Savings Plan. She would also stop reinvesting in the Government Securities Investment Fund.
Speaker Kevin McCarthy has cited reducing the national debt — which topped $31 trillion last year and has increased during both Republican and Democratic administrations, including about a 40 percent increase under former President Donald J. Trump — as a central focus of his party’s agenda.