US Treasury Secretary warns clearly
The US will soon be bankrupt
US Treasury Secretary Janet Yellen warns against insolvency. The threat already in the summer.
US Treasury Secretary Janet Yellen warns of US default.
US Treasury Secretary Janet Yellen (76) has warned Congress that the government could default if the debt limit is not temporarily raised or suspended.
It is “crucial that Congress acts in good time to raise or suspend the debt ceiling,” Yellen wrote in a letter to the party leaders of both houses of parliament. White House spokeswoman Karine Jean-Pierre (48) warned Congress that raising the debt ceiling was non-negotiable.
“Irreparable damage” to global financial stability threatens
Yellen warned that defaulting on debt would cause “irreparable damage” to the US economy, the livelihoods of all US citizens and global financial stability. Accordingly, the United States will reach the debt ceiling next Thursday.
In this case, Yellen announced that her ministry would have to take “extraordinary measures” to avoid the United States becoming insolvent. However, such measures could postpone the problem for a maximum of six months, she warned.
Jean-Pierre stressed that the White House “will not conduct any negotiations” on the issue. There has always been bipartisan cooperation in raising the debt ceiling “and that’s how it should be,” she said. “It shouldn’t be a political game ball.”
Bankruptcy threatens again and again
The debt limit has been suspended or raised dozens of times by presidents of both parties over the past few decades – and with bipartisan majorities.
However, some Republican MPs want to use their agreement to raise the cap as a bargaining chip to push through spending cuts. In the midterm elections in November, the Republicans won a narrow majority in the House of Representatives.
If the Senate, controlled by the Democratic Party, and the House of Representatives, controlled by the Republican Party, cannot come to an agreement, the world’s largest economy faces insolvency. (AFP/euc)