Yellen Supports Efforts To End Debt Ceiling Completely

With a potential default looming for the United States in October, Treasury Secretary Janet Yellen said on Thursday that she would see the power to limit debt withdrawn from Congress just as soon.

A bill introduced in May would repeal the national debt ceiling, and Yellen said “yes, I would” when asked in a House hearing if she supported the effort.

She noted that Congress makes the decisions on taxes and spending, and should provide the capacity to pay those obligations.

“If in order to fund these tax expenditures and decisions it is necessary to issue additional debt, I think it is very disturbing to put the president and myself, the secretary of the treasury, in a situation where we could be. unable to pay the bills that result from these past decisions, ”she said in response to a question from Representative Sean Casten, D-Ill.

The remarks were made during a hearing before the House Financial Services Committee on the Treasury and the Federal Reserve’s economic response to the Covid pandemic.

Casten said he was asking Yellen about the concept of removing the debt ceiling, not the particular bill, brought forward by Rep. Bill Foster, also a Democrat from Illinois, along with a trio of Democratic senators.

Yellen warned this week that the extraordinary measures his department uses to continue funding government operations expire on October 18.

Earlier in the hearing, she said the consequences would be dire if Congress did not raise the spending limit.

“I think it would be catastrophic for the economy and for individual families,” she said.

The United States is currently in debt of $ 28.4 trillion, of which nearly $ 700 billion has been incurred since President Joe Biden took office and chose Yellen to head the Treasury. The budget deficit in the first 10 months of the fiscal year stood at $ 2.71 trillion.