Treasury Secretary Janet Yellen announces another step to avoid default

January 24 (UPI) — U.S. Treasury Secretary Janet L. Yellen sent a letter to congressional leaders informing them that she would not invest certain public pension funds in securities to avoid going over the debt ceiling. Yellen also urged Congress to take action to address the issue.

The debt ceiling, which is the maximum amount of debt the government is allowed to take on to fund payments already authorized by Congress, is currently $31.4 trillion The United States reached that limit on Thursday.

“As of January 23, I have also determined that due to the statutory debt limit, I will not be able to fully invest in the Government Securities Investment Fund (G-fund) of the Savings Savings Fund, part of the federal employees’ pension system. , in United States interest-bearing securities,” Yellen wrote in a letter sent to Congressional leaders on Tuesday.

“The charter governing G Fund investments expressly authorizes the Secretary of the Treasury to suspend G Fund investments to avoid breaching the statutory debt limit,” she continued.

Yellen indicated that by law Fund G would be reinstated if the debt limit was increased or suspended.

“I respectfully urge Congress to act immediately to fully protect the trust and credibility of the United States,” she concluded.

Yellen said public money and emergency measures could be used to keep the government from defaulting on its debt obligations, but would likely run out before early June.

House Speaker Kevin McCarthy said Republicans would push for spending cuts before agreeing to a debt ceiling hike, but President Joe Biden said the debt ceiling hike was “non-negotiable.”

The US has never defaulted on its debt, and Congress has raised the debt ceiling about 80 times since 1960.

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