Yellen’s Call to Raise the Debt Limit
The multi-trillion-dollar infrastructure plan the Biden Administration is attempting to push through congress is quite frightening, then add the other proposed expensive packages. One of these bills is meant to speed up economic recovery in the aftermath of the COVID-19 pandemic by creating a stimulus program. Another of these additional bills is to, regardless of family income, provide free school lunches to all students.
As the Administration works to force these bills into law, the Secretary of the Treasury Janet Yellen is looking for lawmakers to back her move to raise our country’s debt limit. Yellen met with the Senate Appropriations Subcommittee on Wednesday, June 23, to discuss using the debt limit to deter the impending default on U.S. debt obligations and forestall a financial recession.
“Defaulting on the national debt should be regarded as unthinkable,” Yellen said. “Failing to increase the debt limit would have absolutely catastrophic economic consequences. It would be utterly unprecedented in American history for the United States government to default on its legal obligations.”
This looming crisis developed in 2019 when Congress deferred the cap on federal borrowing through July 2021. If congress does not allow the increase in the U.S. debt limit and the deferred cap is allowed to go into arrears, the Treasury will be forced to use emergency actions to comply with the debt due.
Going into arrears will remove the ability of the Treasury to secure funds from sale of government securities. One such emergency action taken in the past was the halting of subsidies to the federal employed pension program. Emergency actions will provide a makeshift means to generate debt payment in order avert a default.
Also generating alarm over future federal funding is the depletion of the reserves by the trillions spent on aid the multiple economic stimulus packages paid over the past year during the COVID-19 pandemic. Additionally, Yellen implored that action must be taken soon as funds to pay the debt may be exhausted by August, while Congress is on it’s summer break.
Yellen forewarned the Subcommittee the failure to raise the debt ceiling will result in financial crisis. This will include the loss of jobs and savings accounts as the world is still experiencing a pandemic. Yellen emphasized that it is unthinkable to even consider defaulting on federal debt.
The Senate is divided 50:50, and to raise the debt ceiling would require at least 10 Republicans to vote along with the Democrats.
LMAO…soon, we won’t even be able to pay the interest on the debt. If you remember back the N-I-G-G-E-R about doubled the debt, with nothing to show for it.
Better idea – stop spending like drunken sailors!!
This site has a moderator. It must be run by the communist Chinese.
No, Janet,no. Let the gov shut down and cut spending.
Truth does not require moderation.
Liberals and RINOS have been increasing the debt limit since we had a debt limit. Take note, IT HAS NEVER BEEN DENIED OR REJECTED. The Federal debt is currently 30 trillion. Just 6 years ago it was 20 trillion. 99% is held by China who just attacked the globe with a biological warfare attack Covid was just the beta test to see if they could get away with it. So now that they have it is only a matter of time for a more deadly one. But this time they will develop their vaccine first before they attack.
Just curious? Who the hell did we borrow the money from in the first place and what are the agreed upon conditions to pay it back? This reckless spending all started during the war in vietnam and there has been no letup since. This is what happens when our elected officials belong to a political party which apparently is their first allegense. We really desperately need a new law that disallows any candidate running for office to be or to ever have been an member of any political party. Otherwise this farce we call our government is going to take us all straight to Hell without a basket!
Here’s the breakdown from the March 2021 US Treasury Bulletin:
Foreign: $7.07 trillion (in September 2020, Japan owned $1.28 trillion and China owned $1.06 trillion of U.S. debt, which is more than a third of foreign holdings)
Federal Reserve and government: $10.81 trillion (December 2020)
Mutual funds: $3.5 trillion
State and local governments, including their pension funds: $1.09 trillion
Private pension funds: $784 billion
Insurance companies: $253 billion
U.S. savings bonds: $147 billion (December 2020)
Other holders, including individuals, government-sponsored enterprises, brokers and dealers, banks, bank personal trusts and estates, corporate and non-corporate businesses, and other investors: $2.28 trillion
She is another failure in the biden circus of freaks and fools.
We cannot afford to do this again. Money is not a limitless commodity! Sooner or later, the house of cards must fall. Isn’t the damage big enough now?