Treasury Secretary: ‘Extraordinary Measures’ to Be Taken If Congress Doesn’t Raise Debt Limit

Treasury Secretary Janet Yellen on Friday urged congressional leaders to suspend or raise the national debt limit before Aug. 1. or face dire economic consequences. Yellen warned that if Congress does not take action, her department will need to implement “extraordinary measures” to prevent the government from defaulting on its loans. “If Congress has not acted to suspend or increase the debt limit by Monday, August 2, 2021, Treasury will need to start taking certain additional extraordinary measures in order to prevent the United States from defaulting on its obligations,” Yellen wrote in a letter to congressional leaders. The debt ceiling is a legal limit on the amount of borrowing the Treasury can do. When the federal government spends more than it collects, it borrows money to cover the difference, commonly by issuing IOUs in the form of U.S. Treasury securities. By end of 2020, the federal government had hit its debt limit of $22 trillion …Read More

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