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WASHINGTON – US Treasury Secretary Janet Yellen said there was “a huge amount at stake” after the Senate approved only a short-term extension of the debt ceiling, creating another default potential in December if Congress is unable to strike another deal.
“Failure to raise the debt ceiling would likely cause a recession, and could even lead to a financial crisis, it would be a disaster,” Yellen said on ABC’s ‘This Week’ Sunday.
His comments come just days after the Senate passed a bill to extend the debt limit until early December, temporarily ending a partisan standoff before the government deadline of October 18 to avoid default. of payment. The House, which was due to come out next week, will return on Tuesday and is expected to pass the measure.
Yellen outlined the potential consequences of not raising the debt ceiling. 50 million Americans receiving Social Security benefits would be at risk, troops wouldn’t know when or if they would be paid, and child tax credit payments, which 30 million families receive, would be in jeopardy.
The Senate vote on the deal required 60 votes, meaning ten Republican votes were needed to bypass the GOP obstruction and get to the final simple majority vote. While those ten votes were won, no Republican joined the Democrats in the final vote on passing the bill, indicating that another battle is likely to ensue later this year.
Senate Minority Leader Mitch McConnell on Friday sent a warning to President Joe Biden, saying Republican leaders would not work with Democrats on “any future efforts to mitigate the consequences of Democratic mismanagement.”
“Your lieutenants on Capitol Hill now have the time they claimed lacked to settle the debt ceiling through a stand-alone reconciliation, and all the tools to do it. They can’t invent another crisis and ask for my help. “said McConnell.
Yellen was asked directly what the consequences would be if McConnell kept his word, she replied: “Well, it is absolutely imperative that we raise the debt ceiling, it is necessary in order not to fund new spending programs, but to pay the bills that result from the decision of Congress requested rulings. “
After being passed by the House, the bill would then go to Biden, who is expected to sign it. The Senate is on recess scheduled for this coming week.
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