WASHINGTON — Treasury Secretary Janet L. Yellen warned on Friday that she would have to begin employing “extraordinary measures” to continue paying the nation’s bills this month if lawmakers do not act to raise the statutory debt limit and that her powers to delay a default could be exhausted by early June.
Ms. Yellen’s letter to Congress was the first sign that resistance by House Republicans to lifting the borrowing cap could put the U.S. economy at risk and signals the beginning of an intense fight in Washington this year over spending and deficits.
“Failure to meet the government’s obligations would cause irreparable harm to the U.S. economy, the livelihoods of all Americans and global financial stability,” Ms. Yellen wrote.
The Treasury secretary said that there is considerable uncertainty surrounding how long she can use measures to a delay a default and that she would keep Congress abreast of the fiscal situation. Ms. Yellen said that she would begin suspending new investments in the Civil Service Retirement and Disability Fund and the Postal Service Retiree Health Benefits Fund and suspending reinvestment of the Government Securities Investment Fund of the Federal Employees Retirement System Thrift Savings Plan later this month to avoiding breaching the debt limit.
A White House spokesman declined to immediately comment on Friday, but said Karine Jean-Pierre, the press secretary, would most likely address the issue at a news briefing in the afternoon. Ms. Jean-Pierre has repeatedly said President Biden will not negotiate with congressional Republicans on the debt limit, despite their calls to link an increase in the limit to cuts in federal spending.
“Congress is going to need to raise the debt limit without conditions,” Ms. Jean-Pierre told reporters traveling with Mr. Biden to Texas on Air Force One last week. “There will be no hostage taking.”
