(Bloomberg) -- Treasury Secretary Janet Yellen renewed her call for Congress to raise or suspend the U.S. debt ceiling, saying the government will otherwise run out of money to pay its bills sometime in October.
Writing in a Wall Street Journal op-ed, Yellen said “the overwhelming consensus among economists and Treasury officials of both parties is that failing to raise the debt limit would produce widespread economic catastrophe.”
The U.S. House will vote next week on raising the nation’s $28 trillion debt ceiling amid a standoff between Democrats and Republicans that still threatens to send the country into a payments default next month.
A U.S. default “would likely precipitate a historic financial crisis that would compound the damage of the continuing public health emergency,” throw the U.S. into recession and leave it a “permanently weaker nation,” she said.
“Neither delay nor default is tolerable” and lawmakers must act quickly, Yellen added.
Senate Minority Leader Mitch McConnell has rejected an appeal by Yellen for Republicans to join with Democrats in raising the federal debt ceiling, leaving the two sides at odds with potentially weeks to go until the limit is breached.
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