U.S. Treasury Secretary Janet Yellen issued a stern warning to Congress on December 27, 2024, stressing the urgent need to address the debt ceiling to prevent a national default. Yellen stated that if Congress does not act promptly, her department will need to implement “extraordinary measures” by January 13, 2025, to keep the government funded. Yellen explained, “These measures are temporary and will allow the government to continue borrowing but will not eliminate the risks associated with default.” The warning comes as Congress is poised to break for the holiday season, with some lawmakers suggesting they may delay action until January. Yellen highlighted the severe implications of a default, stating it would result in increased interest rates, diminished confidence in the U.S. economy, and could negatively impact a range of government services. She implored policymakers to prioritize this issue saying, “Ignoring the debt ceiling could jeopardize the financial credibility of the United States. We need to act now to avoid economic disruption.”
Yellen Warns Congress on Debt Ceiling: Extraordinary Measures Needed to Avoid Default
