U.S. Treasury Secretary Janet Yellen said in a letter to Congress that the agency may be unable to meet all of its debt obligations as soon as June 1 if the debt ceiling is not raised, putting new urgency on talks in Congress.
The date is sooner than an estimate Treasury made in January, suggesting that the U.S.'s fiscal situation is more precarious than earlier known. Here is how lawmakers, economists and others have reacted:
DEMOCRATIC SENATOR SHELDON WHITEHOUSE, CHAIR OF SENATE BUDGET COMMITTEE:
"Republicans’ failure to agree to cleanly raise the debt ceiling has brought the United States to the brink of economic catastrophe. Today, we learned that we are potentially within a month of a self-inflicted economic shock that could dwarf the Great Recession, and Republicans are holding our economy hostage, adding to economic instability ... Hostage-taking is not the way this country governs. We must change course, cleanly raise the debt ceiling, and avert widespread economic pain and instability while we still can."
NO. 2 SENATE REPUBLICAN JOHN THUNE:
"It reinforces the need for the president to get up here or to get (House Speaker Kevin) McCarthy down there to meet with him, one way or the other. I mean, time is a-wasting."
REPRESENTATIVE BRENDAN BOYLE, RANKING MEMBER OF HOUSE BUDGET COMMITTEE:
"House Republicans are running out of time to avert an economic catastrophe of their own making. Today's update from the Treasury Department needs to be a wakeup call for Speaker McCarthy – he has wasted enough of the House's time appeasing his extreme MAGA Republican allies."
DEMOCRATIC SENATOR RON WYDEN, SENATE FINANCE COMMITTEE CHAIR:
"A catastrophic default that would wipe out millions of jobs and crater the American economy is potentially just weeks away, and it’s a crisis manufactured by House Republicans. With Republicans openly admitting they’ll never support anything less than the ransom note they passed last week, not even a bipartisan compromise, it’s clear this has never been a serious negotiation. It is entirely about holding our economy hostage."
DEMOCRATIC SENATOR PATTY MURRAY, SENATE BUDGET COMMITTEE MEMBER:
"House Republicans need to understand that holding the majority means they need to actually govern it’s time to get serious about working with Democrats to simply pay our nation’s bill and avoid a catastrophic default as soon as possible. The clock is ticking - and much faster than many suspected - so House Republicans need to drop their dangerous opposition to paying our nation’s bills."
DEMOCRATIC SENATOR BRIAN SCHATZ:
"To take the American economy hostage cannot be tolerated, and the only thing scarier than not negotiating with these people is negotiating with them, because they will never, ever stop holding Americans and the American economy hostage." Asked if Democrats can maintain that line, he replied: "We must."
REPUBLICAN SENATOR MITT ROMNEY:
"Defaulting on our debt is a frightening prospect - it would destabilize our economy, harm global commerce, and hurt our allies. Furthermore, we wouldn't be able to send Social Security checks or pay our soldiers. The President must negotiate on raising the debt ceiling."
INDEPENDENT SENATOR BERNIE SANDERS:
"There are progressive and fair ways to save money and generate revenue ... So the goal is, if you want to save money, if you want to cut the deficit, that's fine. Do it in a way that's fair, not on the backs of working people."
DEMOCRATIC SENATOR JON TESTER:
"This is nothing to fool around with. The money has been spent. We do not want to default. Let's get the debt ceiling taken care of, but let's talk about how we can reduce the deficit and common-sense ways. If we don't get the debt ceiling, then we go into it a depression."
DEMOCRATIC SENATOR JOE MANCHIN:
"I hope President Biden's invitation to Congressional leaders is sincere and he is genuinely willing to negotiate because the country cannot afford a failed negotiation. Every day without action brings the American government closer to default and the American people closer to economic chaos. I urge President Biden to show true leadership and finally put politics aside and the well-being of our nation first.”
SHAI AKABAS, DIRECTOR OF ECONOMIC POLICY, BIPARTISAN POLICY CENTER:
"Treasury Secretary Yellen’s letter reminds us that the U.S. government is again within mere months or even weeks of failing to make good on all its obligations. That is not a position befitting of a country considered the bedrock of the financial system, and only adds uncertainty to an already shaky economy ... Now, the actual work of negotiating must be done, as this situation will only be resolved when both sides work together on behalf of the American people."
