By Andrea Shalal and Susan Heavey
WASHINGTON, May 21 (Reuters) – US Treasury Secretary Janet Yellen on Sunday said June 1 remains a “hard deadline” for raising the federal debt limit, with the odds being quite slim that the government will collect enough revenue to meet it to bridge June 15. More tax receipts are due.
Yellen said on NBC’s Meet the Press that unless Congress can raise the $31.4 trillion debt ceiling before the Treasury Department approves it, there will be difficult decisions about how to pay Americans money runs out and it becomes insolvent.
“In my last letter to Congress, I indicated that we expect not to be able to pay all of our bills by early June and possibly as early as June 1st. And I’ll continue to update Congress, but I certainly haven’t changed my assessment. “So I think that’s a tough deadline,” she said.
President Joe Biden on Sunday called Republicans’ latest offers in talks about raising the government’s debt ceiling “unacceptable,” but said he was ready to cut spending and make tax adjustments to reach a deal.
He said he would speak with senior Republican Congressman Kevin McCarthy on the flight home from his meeting with leaders of the Group of Seven (G7) rich nations in Hiroshima, Japan.
Less than two weeks remain until June 1, when the Treasury Department warned that the federal government might not be able to pay all of its debts. This would trigger a default that could lead to chaos in the financial markets and a rise in interest rates.
When asked if the Treasury Department could possibly reach June 15 before running out of cash, Yellen said there was some uncertainty about the exact so-called X-date, but she doubted the money would last until June 15 become.
“There’s always uncertainty about tax receipts and spending, so it’s hard to be absolutely certain, but my guess is that the chances of hitting June 15 and still being able to pay all our bills are pretty slim,” she said .
The story goes on
Biden told reporters in Japan he believes he has authority to invoke the US Constitution’s 14th Amendment to raise the debt ceiling without Congress, but said it was unclear if there was enough time to try to use this untested legal theory to avoid default.
Yellen said invoking the amendment “does not appear to be used appropriately in these circumstances, given the legal uncertainty and the tight timeframe we are in.”
(Reporting by Andrea Shalal and Susan Heavey; Editing by Lisa Shumaker and Bill Berkrot)
Comments are closed.