Yellen extends the date of a possible default until December 15 | WIVT

FILE – Treasury Secretary Janet Yellen speaks during a meeting with President Joe Biden and business leaders about the debt limit in the South Court auditorium on the White House campus , Wednesday, October 6, 2021, in Washington. On Tuesday, November 16, 2021, Yellen told Congress she believed she would run out of wiggle room to avoid the country’s very first default shortly after December 15. (AP Photo / Evan Vucci, File)

WASHINGTON (AP) – Treasury Secretary Janet Yellen told Congress on Tuesday she believed she would run out of wiggle room to avoid the country’s very first default shortly after December 15.

In a letter to congressional leaders, Yellen said she believed the treasury could end up with insufficient resources to continue funding the government beyond December 15.

Yellen’s new date is 12 days later than the December 3 date she provided in a letter to Congress on October 18. This letter was based on the fact that Congress had just passed a $ 480 billion increase in the debt limit as a stopgap measure.

As she has done in the past, Yellen urged Congress to deal quickly with the debt limit to eliminate the possibility of a potential default on the nation’s bonds.

“To ensure the full confidence and credit of the United States, it is essential that Congress raise or suspend the debt ceiling as soon as possible,” Yellen wrote to congressional leaders.

Yellen has repeatedly warned that failing to meet the debt limit and allowing the government to default would be catastrophic and likely drag the country into a recession.

In his letter, Yellen said the overtime reflected more up-to-date estimates of government income and spending and was also affected by the infrastructure bill that President Joe Biden signed into law on Monday. This legislation requires the transfer from the treasury of 118 billion dollars by December 15 to the Highway Trust Fund.

Yellen said that after that, although she had “a high degree of confidence that she will be able to fund the US government until December 15” and complete the transfer of the highways trust fund , there are scenarios where the government will find itself with insufficient resources to finance operations. beyond the date of December 15, she said.

The need to raise or suspend the debt ceiling is only one of the budgetary problems facing Congress. Lawmakers also need to approve a budget by December 3, when current interim funding measures run out. Failure to do so would trigger a government shutdown.

And Democrats aim to approve $ 1.75 trillion in measures to extend the social safety net and address threats from climate change. Speaker Nancy Pelosi said she hoped the House could pass the measure, which Republicans oppose, this week. He must also pass the Senate.

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