US Senate Majority Leader Chuck Schumer has said Congress must get a bill raising the debt ceiling to President Joe Biden's desk by the end of the week, or else the United States could default on trillions of dollars of debt which could be disastrous for the economy and devastating to American families
Schumer issued the ambitious timeline on Monday despite the fact that Republicans and some Democrats are opposed to raising the debt ceiling.
US Treasury Secretary Janet Yellen has called on Congress to abolish the “very destructive” federal debt limit by October 18. Schumer's timeline cuts in half the roughly two weeks that lawmakers have to raise the nation's borrowing limit.
"Let me be clear about the task ahead of us: we must get a bill to the President’s desk dealing with the debt limit by the end of the week. Period," Schumer wrote in a letter to Senate Democrats.
In his letter, Schumer argued that Congress couldn't afford to go down to the wire, a move that could rattle the financial markets.
"We do not have the luxury of waiting until October 18th, as it is our responsibility to re-assure the world that the United States meets our obligations in a timely fashion and that the full faith and credit of the United States should never be in question. The consequences of even approaching the X date could be disastrous for our economy and devastating to American families," Schumer wrote.
In 2019, Congress and then-President Trump suspended the debt ceiling in 2019.
Last week, Yellen told lawmakers that the US would default by October 18 without action to raise the debt ceiling.
“At that point, we expect the Treasury would be left with very limited resources that would be depleted quickly. It is uncertain whether we could continue to meet all the nation's commitments after that date,” Yellen said.
Congress has so far failed to raise America’s $28 trillion debt ceiling amid a standoff between Democrats and Republicans, who have refused to support raising or suspending the current ceiling.
Yellen has said that the crisis triggered by default “would compound the damage of the continuing public health emergency,” plunge the US economy back into recession and leave it a “permanently weaker nation.”
She also described economic damage that would fall on consumers through higher borrowing costs and lower asset prices.
Democrats have tried to insist Republicans work with them to raise or suspend the debt limit.
Republicans have twice blocked Democrats from suspending the debt ceiling. Senate Republican Leader Mitch McConnell (Ky.) is trying to force Democrats to do it under reconciliation, a budget process that lets them avoid the Senate filibuster.
"For two and a half months, this all-Democrat government has known they will need to use a fast-track party-line process to raise the debt ceiling, but have done nothing," McConnell said in a statement over the weekend.