Debt Default Would ‘Permanently’ Weaken America

WASHINGTON—U.S. Treasury Secretary Janet Yellen issued a fresh plea for Congress to raise the federal debt ceiling on Sunday, arguing a default on U.S. debt would trigger a historic financial crisis.

In a Wall Street Journal opinion piece, Yellen said that the crisis triggered by a default would compound the damage from the continuing coronavirus pandemic, roiling markets and plunging the U.S. economy back into recession at the cost of millions of jobs and a lasting hike in interest rates.

“We would emerge from this crisis a permanently weaker nation,” Yellen said, noting that U.S. creditworthiness has been a strategic advantage.

Yellen did not offer a new timeline for a possible default, but described economic damage that would fall on consumers through higher borrowing costs and lower asset prices.

She has said previously that a default could come during October when the Treasury exhausts its cash reserves and extraordinary borrowing capacity under the $28.4 trillion debt limit.

“We can borrow more cheaply than almost any other country, and defaulting would jeopardize this enviable fiscal position. It would also make America a more expensive place to live, as the higher cost of borrowing would fall on consumers,” Yellen wrote. “Mortgage payments, car loans, credit card bills—everything that is purchased with credit would be costlier after default.”

Republicans have refused to support raising or suspending the $28.4 billion. U.S. Senator Bill Cassidy from Louisiana said earlier on NBC’s “Meet the Press” program that Democrats want to increase the borrowing cap to fund trillions of dollars in “Democratic wish list” spending.

Yellen argued the debt ceiling is about paying for past spending obligations, and said waiting too long to lift the debt ceiling can still cause damage, citing a 2011 debt ceiling crisis that pushed the federal government to the brink of default that prompted a credit rating downgrade.

“This led to financial-market disruptions that persisted for months. Time is money here, potentially billions of dollars. Neither delay nor default is tolerable.”

House of Representatives Speaker Nancy Pelosi, in a statement, cited Yellen’s past remarks on the issue and noted that Congress addressed the debt ceiling on a bipartisan basis three times during the Trump administration.

“When we take up the debt limit this month, we expect it to be bipartisan once more,” Pelosi said.

Still, House Majority Whip Jim Clyburn on Sunday that Democrats may have to pass the debt ceiling hike without Republican support.

“I think we ought to do what’s necessary and message to the American people exactly who is trying to destroy this great democracy that we hope to keep in place,” he told CNN.

By David Lawder


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Biden Administration Warns US May Hit Debt Limit in a Few Weeks

Treasury Secretary Janet Yellen on Wednesday warned the United States could hit its debt limit by next month, warning Congress that she will run out of maneuvering room.

In a letter to leaders of Congress, Yellen said she can’t provide a specific date for when she’ll be not able to keep the federal government funded unless the chamber raises the debt limit. Should that happen, according to estimates from the Congressional Budget Office, funding for Social Security, Supplemental Security Income, and Medicare will likely be halted.

“Given this uncertainty, the Treasury Department is not able to provide a specific estimate of how long the extraordinary measures will last,” the secretary wrote in the letter (pdf). “However, based on our best and most recent information, the most likely outcome is that cash and extraordinary measures will be exhausted during the month of October. We will continue to update Congress as more information becomes available.”

And Yellen warned that once cash on hand and other available measures are exhausted, the United States “would be unable to meet its obligations for the first time in our history.”

The U.S. debt ceiling, which reached $22 trillion in August 2019, is the legal limit on the amount of debt the federal government can borrow, according to the Committee for a Responsible Federal Budget. Lawmakers missed a July deadline to extend former President Donald Trump’s two-year suspension on the borrowing limit, which was reinstated in August 2021.

For months, Yellen has warned lawmakers to raise the U.S. debt limit before the end of July and warned that a delay could cause “irreparable damage to the U.S. economy and global financial markets.”

“Waiting until the last minute to suspend or increase the debt limit can cause serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers, and negatively impact the credit rating of the United States,” Yellen also wrote in her letter. “At a time when American families, communities, and businesses are still suffering from the effects of the ongoing global pandemic, it would be particularly irresponsible to put the full faith and credit of the United States at risk.”

Her later was dated Wednesday and was sent to House Speaker Nancy Pelosi (D-Calif.), Senate Majority Leader Chuck Schumer (D-N.Y.), House Minority Leader Kevin McCarthy (R-Calif.), and Senate Minority Leader Mitch McConnell (R-Ky.).

In response to the warning, Pelosi told reporters this week that Congress has several means to raise or suspend the debt ceiling before funds run out.

“We’d like to do it in a bipartisan way,” Pelosi said. “We don’t ever want to put the full faith and credit [of the U.S.] in doubt

Jack Phillips

Senior Reporter

Jack Phillips is a reporter at The Epoch Times based in New York.

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‘Irreparable damage,’ ‘financial Armageddon’: Biden admin, Democratic economists sound alarm in bid to raise debt limit, warn US will run out of cash in October

Biden administration officials and Democratic economists are warning congressional leaders that if action is not taken soon to raise the country’s $28.4 trillion debt limit, ruinous injury could be incurred by the American economy.

What are the details?

In a letter to top lawmakers Wednesday, Treasury Secretary Janet Yellen characterized America’s financial situation as teetering on the edge of catastrophe, noting that without intervention the U.S. government would run out of cash by next month.

“Based on our best and most recent information, the most likely outcome is that cash and extraordinary measures will be exhausted during the month of October,” the secretary said.

As Congress deliberates raising the debt limit, Yellen warned that the uncertainty alone may inflict harm on the financial markets. She recalled the last debt limit standoff in 2011 that resulted in the United States’ credit rating being downgraded for the first time ever.

“A delay that calls into question the federal government’s ability to meet all its obligations would likely cause irreparable damage to the U.S. economy and global financial markets,” she wrote.

What else?

Others, too, have sounded the alarm, forewarning that the effects of a debt default or government shutdown could be irreversible.

“In short, a default would be an economic cataclysm,” CNN reported. “Interest rates would spike, the stock market would crater, retirement accounts would take a beating, the value of the US dollar would erode and the financial reputation of the world’s only superpower would be tarnished.”

“It would be financial Armageddon,” Mark Zandi, a Democratic economist who leads Moody’s Analytics, told the network. “It’s complete craziness to even contemplate the idea of not paying our debt on time.”

JPMorgan Chase CEO Jamie Dimon also urged lawmakers to action in May, according to CNN. At that time, he said a default “could cause an immediate, literally cascading catastrophe of unbelievable proportions and damage America for 100 years.”

Anything else?

The comments come as congressional lawmakers approach a decision point this month on the debt limit. Reuters reported Tuesday that with both sides entrenched, the debate is set to “become a monumental game of chicken.”

Republicans have cast Democratic arguments for raising the debt limit as rich considering the party’s keenness for exorbitant government spending.

In May, Republican Sen. Mitch McConnell slammed Democrats’ multitrillion-dollar plan to expand social services, saying, “If they want all this spending and debt to be their signature legacy, they should leap at the chance to own every bit of it” by passing a debt limit without Republican votes.

In order to do that, Democrats would reportedly need to shove the debt limit increase into a reconciliation bill that they could advance in the Senate without Republican support.

But owning the issue does not appear to be something Democrats want to do. Democratic House Speaker Nancy Pelosi told reporters Wednesday, “We won’t be putting it in reconciliation,” while blaming the increased debt on former President Trump.

It should be noted that both parties do share some of the blame for a continually ballooning national debt.

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Biden admin won’t seek enhanced unemployment past Labor Day

Treasury Secretary Janet Yellen and Labor Secretary Marty Walsh announced on Thursday that the enhanced unemployment benefits put in place to help during the COVID-19 pandemic will expire on Sept. 6, with the administration stating that extra jobless benefits can be extended by the states. 

“The temporary $300 boost in benefits will expire on September 6th, as planned,” the two wrote in a letter to Senate Finance Committee Chairman Ron Wyden (D-Ore.) and Ways and Means Chairman Richard Neal (D-Mass.).

“As President Biden has said, the boost was always intended to be temporary and it is appropriate for that benefit boost to expire.”

The ​​$300 increase to weekly unemployment benefits, in addition to the Pandemic Unemployment Assistance program which provides assistance to contractors, and the Pandemic Emergency Unemployment Compensation were extended in a sweeping $1.9 trillion stimulus bill passed in March. The officials touted the drop in unemployment numbers, but noted that states that are still struggling can use the bill’s funding allocated to continue the boost.

“In addition, President Biden believes that the conditions exist in many states such as the other emergency UI [unemployment insurance] programs can end on the date set in the American Rescue Plan,” Yellen and Walsh wrote.

“… There are some states where it may make sense for unemployed workers to continue receiving additional assistance for a longer period of time, allowing residents of those states more time to find a job in areas where unemployment remains high,” the said. 

Secretary of Labor Marty Walsh and Treasury Secretary Janet Yellen noted the pandemic revealed problems in unemployment.
REUTERS/Erin Scott/File Photo

When the benefits expire on Labor Day, around 7 million people are expected to lose their benefits and receive cuts to the aid they have been receiving. 

While progressives have pushed for the benefits to be extended beyond September, Republicans have pushed back on the notion, arguing it deters people from getting back to work.

Yellen and Walsh noted that Biden thinks the pandemic revealed “serious problems” with the unemployment process and feels it needs to be reformed. 

“Beyond the immediate issue of expiring benefits, President Biden believes that the pandemic has exposed serious problems in our UI system that require immediate reform. Accordingly, he is calling on Congress to take up the issue of long-term UI reform as part of the reconciliation process, when Congress returns from recess,” they wrote.

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Infrastructure bill contains driver fee proposal that could cross Biden’s ‘red line’

The $1 trillion bipartisan infrastructure bill being debated in the Senate could violate President Biden’s “red line” against a national gas tax hike ​by imposing a “national motor vehicle per-mile user fee pilot program,” according to reports. 

Biden has said he was willing to negotiate the infrastructure package but resisted adjusting the gas tax to the rate of inflation or setting user fees because they would raise taxes on Americans earning less than $400,000 a year — a red line he said he wouldn’t cross. 

But a pilot program outlined in section 13002 of the bill would charge drivers a fee for every mile traveled, Fox Business reported. 

It directs Transportation Secretary Pete Buttigieg and Treasury Secretary Janet Yellen to provide recommendations to Congress within three years after the program was established.

At that time, lawmakers could decide whether to pass new legislation implementing per-mile charges to fund infrastructure projects, the report said.

Traffic is seen on a highway ahead of the July 4th holiday.
The pilot program would charge drivers a fee for every mile traveled.
REUTERS/Eduardo Munoz

The federal gas tax has remained at 18.4 cents a gallon since 1993 and has not been adjusted to inflation, Fox Business reported. 

The pilot program would target passenger vehicles, light truck and medium- and heavy-duty trucks and the fees would be set depending on the types and weight classes of the vehicles “to reflect estimated impacts on infrastructure, safety, congestion, the environment, or other related social impacts.”

“The Secretary, in coordination with the Secretary of the Treasury, and consistent with the recommendations of the advisory board, shall establish a pilot program to demonstrate a national motor vehicle per-mile user fee to restore and maintain the long-term solvency of the Highway Trust Fund and to improve and maintain the surface transportation system,” the bill​ says.

​The Biden administration rejected the possibility that the proposed program would lead to a nationalized mileage fee, depending on the recommendations by Buttigieg and Yellen, because the White House could oppose a measure establishing the tax. 

“There is literally nothing in the bill that is counter to the president’s pledge. This refers to two provisions about research. One gives grants to states if they want to apply to do their own research. The second involves a federal pilot program based on individual volunteers, who receive full refunds, for studies that would then only be the basis for recommendations about future legislation,” ​a White House official ​told the Washington Examiner.

It directs Transportation Secretary Pete Buttigieg and Treasury Secretary Janet Yellen to provide recommendations to Congress within three years after the program was established.
Transportation Secretary Pete Buttigieg and Treasury Secretary Janet Yellen would need to provide recommendations to Congress within three years after the program was established.
REUTERS/Andrew Kelly

“The administration will evaluate all legislation, including any bills relevant to these pilot programs, against the $400,000 pledge,” the official said.

A​t a White House briefing on July 6, press secretary Jen Psaki said the president didn’t want Americans to have to shoulder a new tax.

​​”​That’s one of the core reasons why the President was opposed — vehemently opposed — to a gas tax and any tax on vehicle mileage, because he felt that would fall on the backs of Americans.  And that was a bottom line, red line for him​,” she said.​ 

The mileage fee program was raised by Sens. Tom Carper (D-Del.) and ​Shelley Moore Capitol (R-W.Va.) in March. 

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Infrastructure Bill Has Provision That Could Lead to Big Fees on Americans and Blow Up Biden’s Promise on Taxes – RedState

Remember that promise of Joe Biden’s that he wasn’t going to raise taxes on people earning less than $400,000 per year?

“If you make less than $400,000, you won’t see one single penny in additional federal tax,” Biden told George Stephanopoulos in March 2020.

But then Psaki tried to fudge that by saying that they meant “families” earning that amount or suggesting that it referred to couples. Which, of course, has a completely different meaning and leaves individuals at much greater risk.

But that is not the only place where the Democrats are trying to sneak something past us in regard to potential taxes.

In the new bipartisan infrastructure deal, there’s a provision for a multiyear “national motor vehicle per-mile user fee pilot” program. The pilot program, in section 13002 of the bill, would target personal vehicle mileage, charging users based on vehicle miles traveled.

From Fox Business:

The 2,702-page bill directs Treasury Secretary Janet Yellen and Transportation Secretary Pete Buttigieg to provide recommendations to Congress within three years of the pilot program’s establishment, at which point lawmakers could choose whether or not to pass new legislation taxing miles-per-vehicle in order to fund the infrastructure overhaul.

The program would target passenger motor vehicles, light trucks and medium- and heavy-duty trucks, while fees would likely vary between vehicle types and weight classes “to reflect estimated impacts on infrastructure, safety, congestion, the environment, or other related social impacts.”

“The Secretary, in coordination with the Secretary of the Treasury, and consistent with the recommendations of the advisory board, shall establish a pilot program to demonstrate a national motor vehicle per-mile user fee to restore and maintain the long-term solvency of the Highway Trust Fund and to improve and maintain the surface transportation system,” the bill text reads.

Per-mile user fee. So what’s the White House’s response to what looks like a sneaky way to move toward instituting a national mileage tax?

From Yahoo:

“There is literally nothing in the bill that is counter to the president’s pledge. This refers to two provisions about research. One gives grants to states if they want to apply to do their own research. The second involves a federal pilot program based on individual volunteers, who receive full refunds, for studies that would then only be the basis for recommendations about future legislation,” one White House official elaborated. “The administration will evaluate all legislation, including any bills relevant to these pilot programs, against the $400,000 pledge.”

The pilot program will be tested using “volunteers” who will be reimbursed, the White House claims.

So you’re just running a pilot program to determine if we should have a national vehicle per-mile user fee, but don’t worry because hey, we might decide not to do it? We’re supposed to believe that? Why are you even looking into it, to begin with? Do we need to remind people that income taxes originally were not supposed to be a permanent thing?

Democrats – they just can’t stop trying to put taxes on you, even if they promise not to. This serves their purpose of making it expensive to drive a car, thus reducing the driving and serving their climate change purposes. This could devastate a lot of people, especially those who drive as part of their job or have reason to drive a lot. The 17 Republicans who went along with this ought to have their heads examined.

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Aliens, Xi, and More Lies – RedState

There’s a reason that they hid Joe Biden in the basement for so long.

Every time they let him out and have him speak for any extended period of time, trouble ensues.

I don’t know who agreed to have Biden go on a CNN town hall with Don Lemon tonight. Maybe they thought that CNN would be easy and have softballs. Doubtless, that’s right. But it still doesn’t stop Joe’s brain from breaking and going on the fritz again.

This is just a mess, as he struggles to find a coherent thought amid the jumble of words that flow out. What the heck is he actually saying here?

Zach Parkinson was braver than I was. He actually transcribed some of that.

I think Biden was talking about having trusted people convince people to get the vaccination shot. But it gets really weird when he starts talking about “man in the moon” and “aliens.”

Then he claims, contrary to all evidence, that his massive spending bills will reduce inflation, reduce inflation, reduce inflation. Repeating it three times doesn’t make it any more true. Pro tip for Biden? You don’t cure inflation by spending more which is basically what you are saying. That’s counter to all common sense. Notice how Biden also accidentally admits that people were not returning to work and prices were being driven up because of the unemployment benefits he provided.

He’s really going to kill the economy even more than he already has, when President Donald Trump had it coming back before Biden came in.

Biden keeps saying there’s no economist who thinks there’s going to be a long-term problem with inflation. Here he claims Larry Summers agrees there isn’t a concern. Yet Summers said in fact, there was cause to be concerned about inflation.

Now, was he just mistaken about Summers? Well, no. Summers actually met with Biden economic advisers to warn them that Biden and the Democrats’ spending is a real problem.

So Biden should know exactly what Summers thought, and that was just a lie.

The rest of the world is wondering about us, seeing what they did of Biden’s incoherent condition at the G7. Unfortunately, that’s not good for the world that we’re in this condition and it’s certainly not good for us. Notice how he praises Xi, who Biden just accused of cyber attacks on us, but refused to prefer any sanctions against them. What’s the Chinese word for “kompromat?” Yǒuzuì de zhèngjù. What does Xi have on Biden?

Biden spins some babble about the middle class, corporations, and Delaware.

But one of the reasons that Delaware has attracted so many corporations is because there’s no corporate tax, that’s why it’s a corporate haven. It shows how lowering taxes leads to growth. Joe is pushing the exact opposite: Tax everyone as much as possible. “Pay their fair share,” he claims, doing that creepy lowering his voice thing again. But the rich already pay most of the taxes, a fact that Democrats constantly skip over.

Here they’re talking about the filibuster. Lemon says well if it’s “Jim Crow” why don’t you just get rid of it. Biden’s response makes no sense.

Of course, the filibuster has nothing to do with Jim Crow. But if you want to call it that, then why did Democrats use it more than 300 times last year? Party of Jim Crow.

We’ll have more coming on his responses to audience questions, but just one more example of how bad it can be when they actually let him talk.

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Yellen Criticizes Trump’s China Trade Policy, Tariffs

WASHINGTON—Treasury Secretary Janet Yellen has questioned the merits of tariffs imposed by the Trump administration on billions of dollars of Chinese goods, stating that they’ve harmed U.S. consumers.

Yellen is the first Biden official to criticize the existing tariffs, and her comments raise the question of whether the White House is preparing to change course on the country’s trade policy with China.

“My own personal view is that tariffs were not put in place on China in a way that was very thoughtful with respect to where there are problems and what is the U.S. interest,” Yellen said in an interview with The New York Times last week.

President Joe Biden kept the tariffs on nearly $360 billion worth of Chinese goods that were enacted by the Trump administration. But he also launched a comprehensive review of the “phase 1” trade agreement signed with Beijing in early 2020.

“Tariffs are taxes on consumers,” Yellen said. “In some cases, it seems to me what we did hurt American consumers, and the type of deal that the prior administration negotiated really didn’t address in many ways the fundamental problems we have with China.”

It’s unclear whether the Biden administration has concluded its review and would lift the existing tariffs soon. Representatives for the administration didn’t immediately respond to a request by The Epoch Times for comment on Yellen’s remarks.

The phase one trade deal signed in January last year under the Trump administration requires Beijing to buy $200 billion worth of additional U.S. goods and services during the two-year period of 2020 and 2021. Analysis of Chinese trade data by the Peterson Institute for International Economics shows that China has met about 58 percent of its purchase target in 2020 and 69 percent through May 2021.

The Trump administration repeatedly said that tariffs on Chinese goods were justified to address China’s unfair trade policies, including intellectual property theft, forced technology transfers, government subsidies for domestic companies, and restricting foreign access to Chinese markets.

During the signing of the phase one agreement, then-President Donald Trump said he would retain tariffs on Chinese goods as leverage for the next round of talks. After the pandemic, however, he expressed hesitation about negotiating a new agreement with China, especially after Beijing’s mishandling of the COVID-19 outbreak.

Biden and his international trade team indicated that there would be no immediate changes to U.S. trade policy.

Companies and trade associations have been pushing hard against tariffs imposed by the Trump administration. More than 6,000 American companies, including Ford, Tesla, and Home Depot, filed lawsuits in the U.S. Court of International Trade seeking to upend the tariffs on Chinese goods.

A group of companies sent a letter to Biden asking him to settle the litigation. They stated that the levies “are not tough on China” but “are tough on U.S. companies, U.S. workers, and consumers who have paid these tariffs as a tax out of their own pockets.”

Yellen’s comments echoed concerns raised by those importers.

In a court filing, the Biden administration asked the court to dismiss the complaints against the tariffs, saying that they were lawfully imposed.

During her confirmation hearing in January, Yellen assured lawmakers that the administration would “take on the challenge of China’s abusive, unfair, and illegal practices.”

It’s unclear whether the Biden administration would remove the tariffs without receiving concessions from Beijing.

Some trade experts have expressed skepticism about whether the Chinese regime can truly commit to structural reforms. Some also believe that the Biden team, compared to the previous administration, has been less explicit about how it would slow China down and challenge its unfair trade practices.

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Child Tax Credit: Janet Yellen Wants It to Be Made Permanent

As the Internal Revenue Service and the Treasury Department begin to issue the first batch of the highly anticipated expanded child tax credits that were approved under President Joe Biden’s American Rescue Plan, there are already growing calls among those in Washington who are contending that these benefits should be made permanent.

One of the more high-profile proponents of the recurring checks is Treasury Secretary Janet Yellen.

“For the first time in our nation’s history, American working families are receiving monthly tax relief payments to help pay for essentials like doctor’s visits, school supplies, and groceries,” she said in a Treasury statement.

“This major middle-class tax relief and step in reducing child poverty is a remarkable economic victory for America—and also a moral one,” she continued.

Yellen reiterated her stance on Thursday during an interview on National Public Radio.

“I think this is something that’s very important to continue,” she said on the Morning Edition program.

“It’s a very important program that will do a huge amount to relieve child poverty, which has been a tremendously important problem in the United States,” she added.

Hard Cash For Families

This newest government-issued cash windfall was green-lighted via Biden’s $1.9 trillion stimulus bill, which now allows eligible parents to collect as much as $3,600 per year for a child under the age of six and up to $3,000 for children between ages six and seventeen. This means that a $250 or a $300 payment for each child will be deposited into the bank accounts of parents on a monthly basis through the end of the year.

However, much like the traditional stimulus checks, income thresholds still need to be met. To qualify for the full child tax credit amount, a family headed by a couple should earn less than $150,000, while for individuals it is set at $75,000.

American Families Plan

The expanded credits will only be continued to be disbursed through December. But if Biden’s American Families Plan ever gets approval from Congress, the payments would continue to head out to eligible parents through the year 2025.

“Across the nation, organizations that advocate for children (are) using social media to explain how the Child Tax Credit will cut child poverty and why we must extend it through the American Families Plan,” Biden said in a statement, adding that about 90 percent of all children in the country will see direct benefits from the monthly payments.

White House Press Secretary Jen Psaki noted during a recent press briefing that “if passed, the families of tens of millions of children will continue to get regular payments.”

Ethen Kim Lieser is a Minneapolis-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.

Image: Reuters

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Debt limit deadline hard to predict due to pandemic, says think tank

WASHINGTON — The Bipartisan Policy Center cautioned on Thursday that it is facing difficulties projecting when the U.S. government will hit its debt limit due to ambiguities over the timeline for economic recovery and cash flows related to COVID-19 relief disbursements. 

The D.C.-based think tank said predicting the “X Date” in which the country will no longer be able to meet its financial obligations “could be particularly unpredictable,” forecasting it would likely default “sometime in fall 2021” if Congress does not take action to raise the debt ceiling. 

“The challenges of accurately forecasting the pandemic’s lingering effects on the economy and the ongoing federal response mean we may not have a clear picture until September, at which point Congress could have just weeks to act,” BPC Economic Policy Director Shai Akabas said in a statement. 

“Policymakers seeking to mitigate risks to the full faith and credit of the United States should act sooner rather than later.”

The think tank noted that while there is uncertainty, the Treasury Department’s decision to hold $450 billion in cash on hand on Aug. 1, significantly more than the $118 billion anticipated, will help supplement its emergency borrowing authority, but is expected to be exhausted in the following months. 

“The Treasury Department’s actions inadvertently bought Congress additional time, but they should not fritter it away,” Akabas continued. 

Treasury Secretary Janet Yellen has urged Congress to take action on the debt ceiling before the end of July.
Treasury Secretary Janet Yellen has urged Congress to take action on the debt ceiling before the end of July.
Greg Nash/Pool via REUTERS/File Photo

“In 2019, the possibility of an earlier than expected X Date forced Congress’ hand and spurred action prior to the August recess. While this year’s timing is not necessarily the same, the uncertainty is even greater.”

Congress passed multiple COVID relief packages aimed at helping individuals and businesses stay afloat during the course of the pandemic, with Biden signing a $1.9 trillion package that passed largely along party lines in March. 

The current debt limit suspension is slated to expire on July 31, with Treasury Secretary Janet Yellen urging lawmakers to act before the end of the month. 

Congress has not yet set a date in which it plans to address the matter, which could become increasingly difficult as members look to address an array of other legislative matters, including a sizable infrastructure package that is expected to be voted on before the end of the month. 

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