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US Treasury urges Congress to raise federal debt ceiling, warns it could run out of cash
The US Department of the Treasury urged Congress to raise the federal debt ceiling before lawmakers leave for the August recess, warning that the government could run out of money in early September.
Washington DC: The US Department of the Treasury on Friday (local time) urged Congress to raise the federal debt ceiling before lawmakers leave for the August recess, warning that the government could run out of money in early September.
"Since there is a reasonable uncertainty in projecting government cash flows, it is impossible to identify precisely how long extraordinary measures will last. We model various scenarios for our cash projections," Treasury Secretary Steven Mnuchin said in a letter to House Speaker Nancy Pelosi as cited by The New York Times.
"Based on updated projections, there is a scenario in which we run out of cash in early September, before Congress reconvenes," the letter read.
"As such, I request that Congress increase the debt ceiling before Congress leaves for summer recess," it added.
To prevent the nation from defaulting on its obligations as Congress is deliberating on an increase of the debt limit, the Treasury Department has the authority to exercise the so-called "extraordinary measures" to keep government agencies running.
Those measures, according to an explanation issued by the department in March, include suspending the sales of Treasury securities issued to state and local government entities, as well as halting new investments and reinvestments in a number of government funds, Xinhua news agency reported.
On Thursday, Pelosi said she is "convinced" that the Congress should act on the debt ceiling before lawmakers leave on July 26 for a six-week recess.
"I am personally convinced that we should act on the caps and the debt ceiling prior to recess," Pelosi said and added, "I'm realistic."
Mnuchin told reporters last month that if the White House and Congress fail to agree on a spending plan, the administration would offer a continuing resolution to keep the government funded at its current levels for a year.Speaking to reporters on June 19 after a meeting between White House officials and congressional leaders at Pelosi's office, the Treasury Secretary also said the White House would propose a one-year debt ceiling increase should the impasse between the legislative and executive branches persist.
President Donald Trump signed an executive order on Feb 9, 2018, suspending the nation's borrowing limit until March 1, 2019, when the national debt exceeded USD 22 trillion. (ANI)