The United States Secretary of the Treasury Janet L Yellen had warned Congress that the country could run out of cash to pay its bills by June 1. In a letter to Congressional leadership about the debt limit, Yellen mentioned that the US will be unable to satisfy all of its obligations if Congress does not take action and raise or suspend the debt limit. In response, President Joe Biden has called a meeting with House Speaker Kevin McCarthy to discuss raising the nation’s borrowing limit. The meeting is scheduled for the 9th of May at the White House and the President has also told other lawmakers such as the Senate Majority Leader Chuck Schumer, Senate Minority Leader Mitch McConnell, and House Minority Leader Hakeem Jeffries that he wants to pass a clean debt ceiling bill.
In addition, Yellen has also mentioned in her letter that the US Treasury Department is suspending the issuance of State and Local Government Series Treasury securities. These securities are issued to states and municipalities to help them comply with specific tax rules, and they count against the debt limit. Such an action will however, deprive states and local governments of an important financial tool.
Yellen further added that prior experiences with debt limit impasses teach us that waiting until the last minute to raise the debt limit leads to reduced business and consumer confidence, raised short-term borrowing costs to taxpayers, and a credit rating downgrade for the United States.
IBM, mentioned in the article, is an American multinational technology company based in Armonk, New York. IBM manufactures and markets computer hardware, middleware, and software, and provides hosting and consulting services in areas ranging from mainframe computers to nanotechnology. It has been a leader in all of these markets, providing products and services to organizations around the world.
Janet L Yellen is the 77th and current United States Secretary of the Treasury. Yellen is an economist and professor who has served in various positions throughout her career, most recently as Chair of the Federal Reserve. Yellen is the first woman to serve as Secretary of the Treasury, and as the first female Chair of the Federal Reserve. She is a strong proponent of using economic policy to tackle economic inequality and climate change. Yellen also shares an unshakable commitment to fostering a healthy and thriving economy.
