Washington, DC – 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.
As BPC awaits full tax season data to update our debt limit X Date projection in the coming days, we know one thing for sure: there is no time to waste. Even before any payments are missed, uncertainty is significantly impacting the U.S. and global economy and costing American taxpayers in the form of higher interest payments on Treasury securities.
The House’s action last week was a necessary step forward in the process. Both parties have laid out their fiscal priorities—President Biden in his budget and House Republicans in the Limit, Save, Grow Act. 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.
Shai Akabas is available for comment. Find BPC’s extensive debt limit resources here.