U.S. Secretary of the Treasury Janet L. Yellen said the nation will be unable to pay its bills as soon as June 1 if the debt ceiling isn't raised.
Yellen recently wrote a letter to all members of congress following-up a previous letter from May 15, according to a May 22 news release. In her previous letter, Yellen estimated the Treasury would be unable to pay all of its bills by early June if the debt ceiling isn't raised. After a week of analyzing available data, Yellen was able to narrow estimates even further by saying the nation could be unable to meet its financial obligations by as early as June 1.
"With an additional week of information now available, I am writing to note that we estimate that it is highly likely that Treasury will no longer be able to satisfy all of the government’s obligations if Congress has not acted to raise or suspend the debt limit by early June, and potentially as early as June 1," Yellen said, according to the release.
Yellen urges lawmakers to act quickly to raise the debt ceiling as waiting until the last minute during previous sessions has had repercussions, according to the release.
"We have learned from past debt limit impasses that waiting until the last minute to suspend or increase the debt limit can cause serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers and negatively impact the credit rating of the United States," Yellen said in the release. "In fact, we have already seen Treasury’s borrowing costs increase substantially for securities maturing in early June. If Congress fails to increase the debt limit, it would cause severe hardship to American families, harm our global leadership position and raise questions about our ability to defend our national security interests."
Yellen says she will continue to update Congress as more information becomes available, the release reported.
"I continue to urge Congress to protect the full faith and credit of the United States by acting as soon as possible," Yellen said, according to the release.
