House Republicans are demanding more information from Treasury Secretary Janet Yellen on what – if any – safeguards are in place to keep the economy from careening off a cliff if the debt ceiling is not increased and the government is forced to make tough spending choices.
House Financial Services Chairman Patrick McHenry, R-N.C., asked Yellen in a Tuesday letter exactly how long the government will be able to operate now that it has hit the $31.4 trillion debt ceiling and asked for an exact date. McHenry asked Yellen to provide “Treasury’s current projection of the X-Date, along with how Treasury has arrived at this projection.”
So far, Treasury has said it expects it will need to begin borrowing money again by June 5, but has not explained publicly how it reached that date.
McHenry also asked Yellen to provide a Treasury briefing to the committee by next week about federal debt management and “contingency planning.”
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On Wednesday, Virginia Rep. Bob Good sent a separate letter that also asked questions about the government’s contingency plans in the event that the debt ceiling is not increased, or some other event causes a breach in the ceiling.
“What plan does the Treasury Department currently have in place to ensure no government default on U.S. debt occurs, irrespective of a breach of the statutory debt limit?” Good asked. “How would Treasury prioritize payments in the event of a breach of the statutory debt limit?”
The debt ceiling is the total amount the federal government is able to borrow in order to pay its obligations, including Social Security, Medicaid and Medicare, and veterans’ payments – among countless other payments.
House Republicans, who have long accused the Biden administration of reckless spending, have insisted they will not act to raise the limit without offsetting it with spending cuts. The White House and the Senate’s Democratic majority argued that raising the debt ceiling is an obligation of the government and accused the GOP of using it as a bargaining chip.
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However, Republicans say Democrats are simply refusing to negotiate on an issue that has been negotiated before.
“The Biden administration is refusing to negotiate on a path to restore fiscal sanity in Washington,” Good told Fox News Digital. “The least Secretary Yellen can do is be transparent with the American people and show us how the Treasury Department plans to prioritize payments to avoid a default if their intransigence causes us to exhaust extraordinary measures.”
“Clarity about such fiscal projections is necessary, however uncertain projections may be,” McHenry wrote in his letter. “Treasury must be fully transparent about the federal debt… As an agent with certain authorities to manage debt and other fiscal operations, Treasury has no right to withhold information about debt or any other fiscal operation or projections from the American people or Congress.”
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Good’s letter, which is backed by nine other House Republicans, cited Yellen’s own past warnings about the potential for global economic turmoil if the U.S. defaults.
“We agree with your statement that ‘spending would have to decline to match the tax revenues,’ but we would go further and state that our spending should decline until our budget is balanced and our debt is reduced to a sustainable level,” the lawmakers said.
“This debate surrounding the debt ceiling is the perfect opportunity to impose real fiscal discipline in Washington.”