Janet Yellen resumed her warnings that the US government soon risks running out of cash, calling on Congress to act quickly to adjust the borrowing limit.
In a letter to congressional leaders on Tuesday, the Treasury secretary said the country could be left with “insufficient remaining resources” after December 15, a date she cautioned could change due to “unavoidable variability” in the government’s cash flows.
Lawmakers narrowly averted default in October, when the Senate voted along party lines to extend the public borrowing limit on a short-term basis by $480bn.
That measure was able to pass the 100-member chamber by a simple majority after a crucial procedural vote saw 11 Republican senators join all 50 Democrats in voting to end the debate on the bill and clear the 60-vote “filibuster” threshold.
But it remains unclear whether Republicans will come to Democrats’ aid this time around, after many GOP lawmakers bristled at Senate majority leader Chuck Schumer’s criticisms of their party following the vote.
Republicans have largely said Democrats should “go it alone” in raising the debt ceiling using a legislative manoeuvre called reconciliation, which bypasses the filibuster.
On Tuesday, White House deputy press secretary Andrew Bates declined to say whether Joe Biden had recently spoken with the Senate’s top Republican, Mitch McConnell, on the issue. “We remain in close touch with leadership, and we believe that it is an absolute must that we raise the debt limit,” Bates said.
Schumer said that while Democrats “hope to [raise the debt limit] in a bipartisan way” they would “figure out how to avoid default”. Yellen said lawmakers should seek to forge a deal “as soon as possible”.