Treasury Secretary Janet Yellen on Monday said the debt-limit deal enacted by Congress last week will allow the government to keep paying its bills through Dec. 3.
In a letter to Capitol Hill leaders, Ms. Yellen said the deal “provides only a temporary reprieve” and urged lawmakers to take further action to ensure that the government can continue to borrow money.
“It is imperative that Congress act to increase or suspend the debt limit in a way that provides longer-term certainty that the government will satisfy all its obligations,” she wrote.
On Thursday, President Biden signed a bill raising the debt ceiling by $480 billion that the House and Senate had approved along party lines.
The bill was based on a proposal by Senate Minority Leader Mitch McConnell (R., Ky.) to temporarily allow the government to keep borrowing money. While the Senate approved the bill along party lines, 11 Republicans joined all 50 Democrats to break a filibuster and allow the Senate to consider an up-or-down vote.
By law, Congress has to set a borrowing limit for the government. Raising the debt ceiling doesn’t authorize new spending but rather allows the government to meet existing obligations, such as sending Social Security checks and making payments on the debt.
If Congress doesn’t raise the debt ceiling, the government would have to suspend payments to beneficiaries or delay interest payments, which would constitute a government default.
Voting to raise the debt limit has become a political fight in recent years as Democrats and Republicans argue over how much the government should be spending. Republicans have sought to use debt-ceiling votes to push for cuts to government programs.
In recent weeks, Republicans have said Democrats should use a procedure known as reconciliation that would allow them to raise the debt limit without any GOP votes. Democrats have objected, saying paying the country’s bills should be a shared responsibility.
Write to David Harrison at [email protected]
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