Treasury Secretary Yellen warns that the US will default on the National Debt in October.
In a letter to congressional leaders, Yellen stated that the US would run out of cash and rely on extraordinary measures to keep the Government within its legal borrowing limits as money runs out.
Yellen sent a letter to Nancy Pelosi, House minority leader Kevin McCarthy, Senate Leader Chuck Schumer, and Senate Minority leader Mitch McConnell stating that “Given this uncertainty, the Treasury Department cannot provide a specific estimate of how long the extraordinary measures will last. 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,”
Yellen went on to say, “Once all available measures and cash on hand are fully exhausted, the United States of America would be unable to meet its obligations for the first time in our history.”
The most chilling part of the letter is that this has not happened in all of American history. Under Biden’s disastrous policies, it will most likely happen because the Republicans vowed not to help Biden on this, but only time will tell if they keep that promise.
Yellen has called on Congress to raise the debt ceiling for the treasury department, not to default. Also, since then, Yellen has begged Congress to give the Treasury the ability to pay the debts already approved by previous Presidents and Congresses.
Yellen wrote on the matter: “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,”
Republicans have refused to raise the debt ceiling unless spending cuts and debt reduction programs are added to any deals. Still, Democrats have vowed to try to jam a debt ceiling increase into the pending 3.5 Trillion infrastructure bill, but it would not pass by the time the Treasury runs out of money.