US hits debt ceiling, sets congressional deadline for ‘early June’

Washington — U.S. Government reach the legal debt limit On Thursday, the Treasury Department said it had begun relying on “special measures” to pay bills.

so letter Treasury Secretary Janet Yellen told congressional leaders on Thursday that these special financial tools to meet national obligations can continue until at least Monday, June 5. After they expire, Congress needs to act to prevent defaults.

In her letter, Yellen said, “The length of time the special measures may last is subject to considerable uncertainty, including the challenge of predicting US government payments and receipts months into the future. Complete trust and credit.”

Yellen’s warning comes at a time when the new Republican House majority led by Speaker Kevin McCarthy in California is calling for conservative policy concessions in the form of spending cuts to raise the debt ceiling.

“Let’s change what we do. Let’s sit down. He’s the president. We have a majority in the House. Democrats have a majority in the Senate. It’s how we designed it to work, find compromises, and discover common-sense compromises that bring us back to a balanced budget,” McCarthy told reporters on Capitol Hill on Tuesday.

California Republican McCarthy said an unconditional debt ceiling hike was “totally off the table,” adding that federal retirement spending needs to be cut to save these programs from bankruptcy. “Let’s sit down and find a place where we can protect Medicare and Social Security for future generations. Get your home organized.”

“I’d like to sit down with all the leaders, especially the president, and start a discussion. I think that’s a show of arrogance. If you ask me, he didn’t even discuss it.” McCarthy said.

But the White House has made it clear what President Joe Biden’s proposal to raise the debt ceiling is.

“We should deal with the debt ceiling unconditionally. Unconditionally.

“This is just one attempt by Republicans in Congress to force unpopular cuts to programs important to seniors, the middle class, and the working class. We need to act. There is no excuse for political brinks,” he said, dismissing the idea that the federal government could break the debt ceiling and decide which bills to pay.

McCarthy did not specify a list of demands that would accompany raising the debt ceiling. deaf. If anything, it’s not clear whether McCarthy has the vote to pass.

Democrats piggybacked on McCarthy’s rhetoric, arguing that House conservatives should cut back on retirement spending.

Former House Speaker Nancy Pelosi (D-Calif.) called it a “non-starter.”

“It’s almost ridiculous for Republicans in the House to put Medicare and Social Security on the table as conditions for raising the debt ceiling,” she said. I hope we can reach an agreement.”

Still, a bill to raise the debt ceiling would need to pass the Democratic-controlled Senate with 51 votes, and it would take 60 votes to defeat the filibuster.

“America pays its debts. Time limit. Debt cap should not be a political brink. House Speaker McCarthy and MAGA Republicans seek to use America’s full trust and credit as a bargaining chip in political negotiations. It is reckless to do so,” Senate Majority Leader Chuck Schumer (DN.Y.) said in a statement Tuesday. “Debt default would be devastating for working American families and lead to rising costs.”

Some Republican hardliners say the borrowing limit shouldn’t be raised at all.

“We can’t raise the debt ceiling,” Rep. Andy Biggs, R-Arizona, Said Twitter on Tuesday. “Democrats carelessly spent taxpayers’ money and devalued the currency. They made their own bed and need to lie down there.”

The White House took aim at Biggs’ tweet on Wednesday.

“Rep. White House spokesperson Andrew Bates says Biggs is actively helping millions of Americans live, 401k plans, and destroying small businesses in the name of scorched-earth partisanship.” “A default would unnecessarily plunge the country into economic chaos, collapse, and catastrophe, giving rivals like China a historic boost.”