In a letter to House Speaker Mike Johnson, US Treasury Secretary Janet Yellen expected the federal debt limit to be reached between January 14 and January 23. This comes after President-elect Donald Trump failed to include a provision to raise or eliminate the debt ceiling in the year-end spending bill.
Once the debt reaches its limit, the government would no longer be able to borrow money, leading to a technical default and an inability to pay its bills. To prevent this and protect the nation’s credit, Treasury Secretary Janet Yellen has urged Congress to take extraordinary measures or use accounting maneuvers to avoid a default.
Currently, the federal government has a debt of approximately $36 trillion, and its borrowing limit is suspended until January 1, following President Joe Biden’s Fiscal Responsibility Act of 2023.
Democrats have long advocated for removing the debt ceiling, arguing that federal spending is too high, while Republicans have traditionally opposed it. However, this time, Trump expressed support for abolishing the debt ceiling, as he stated in an interview with NBC News.
He stated “The Democrats have said they want to get rid of it. If they want to get rid of it, I would lead the charge.”
Despite Trump’s push to extend or abolish the debt ceiling in the end-of-year funding bill, 170 Republicans ignored him. Trump had warned them of primary challenges if they voted to fund the government while excluding the debt limit, but they chose to leave the issue for the next administration to handle.
