United States Secretary of the Treasury, Janet Yellen, urged lawmakers on Monday to act “as quickly as possible” raise loan limit So that the country can honor its financial commitments without cutting costs.
“I urge Congress to act quickly to protect America’s trust and credibility,” Janet Yellen said in a letter to lawmakers.
mechanism of loan limit in usa It came into effect from Sunday after a two-year suspension.
When the debt limit is reached, the country cannot finance itself by issuing loans, but must use the available funds.
Yellen therefore announced the implementation of “extraordinary measures” to suspend certain spending, which he had already announced to Congress in a letter dated July 23.
According to economists, this will give only a few weeks of relief before the default.
The measures would allow “an additional $350 billion in indebtedness, but we expect that amount to be exhausted by the end of September,” according to calculations by Nancy Vanden Houten of Oxford Economics in a note published on Monday.
The theme is a recurring one in American political life. Since 1960, Congress has already taken 78 actions to raise or suspend this debt limit, according to Treasury data.
The mechanism was suspended in August 2019 until July 31, 2021, due to an agreement between the government of Donald Trump and Congress.
The US debt and fiscal deficit continued to grow during the coronavirus pandemic as the executive adopted three massive spending plans in the face of an economic crisis.
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