Yellen sets new deadline for Congress to raise debt ceiling: June 5: NPR

Treasury Secretary Janet Yellen listens during an open session of the Financial Stability Oversight Board meeting at the Treasury Department in Washington, DC, April 21, 2023. Yellen said Friday that Congress would need to raise the debt ceiling by June 5 or the country could run out of cash to pay its bills.

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Treasury Secretary Janet Yellen listens during an open session of the Financial Stability Oversight Board meeting at the Treasury Department in Washington, DC, April 21, 2023. Yellen said Friday that Congress would need to raise the debt ceiling by June 5 or the country could run out of cash to pay its bills.

Alex Wong/Getty Images

Treasury Secretary Janet Yellen said the government won’t have enough money to pay all its bills unless Congress acts to raise the debt ceiling by June 5.

That’s a more specific timeline than Yellen previously gave, when she said the cash crunch would likely come in early June, and possibly “as early as June 1.”

The warning gives lawmakers a few extra days to act before a potentially disastrous government default.

Negotiators for House Republicans and the Biden administration have discussed a deal that would raise the debt ceiling for two years in exchange for discretionary government spending cuts.

However, no agreement has been finalized. And any agreement reached will have to win the support of the House and the Senate.

Act now, Yellen tells Congress

In a letter to members of Congress on Friday, Yellen said the Treasury would make scheduled payments totaling more than $130 billion on June 1 and 2, including payments to veterans, Medicare recipients and security beneficiaries. social. But she added that this would leave the government with very little cash.

Yellen predicted that the government would not have enough money to pay all of its bills due the following week, starting June 5.

“If Congress fails to raise the debt ceiling, it would cause serious hardship for American families, harm our position as a global leader, and raise questions about our ability to advance our national security interests,” Yellen wrote. .

She noted that the government’s short-term borrowing costs have already increased due to the debt ceiling.

“I continue to urge Congress to protect the full faith and credit of the United States by acting as soon as possible,” Yellen wrote.