Yellen says it’s ‘almost certain’ debt ceiling deadline would be in early June

Treasury Secretary Janet Yellen said the deadline to raise the debt ceiling is almost certainly in early June as lawmakers attempt to reach a deal to increase the limit before the country goes into default. 

Yellen said on Wednesday at the Wall Street Journal’s CEO Council Summit that the country must not be allowed to default, and continuing to be able to pay U.S. debts is critical to continued U.S. leadership in the global economy and the role of the U.S. dollar in the world. 

“It seems almost certain that we will not be able to get past early June,” she said. 

Yellen has said the U.S. could default on its debts for the first time in its history as soon as June 1 if an agreement to raise the debt ceiling is not reached. She and other members of the Biden administration have warned that a default would likely cause the country to go into a recession and have wider impacts on the global economy. 

But some Republicans have recently shown doubt about June 1 being an exact deadline for a deal, calling on Yellen to demonstrate how she determined that date. 

Rep. Patrick McHenry (R-N.C.), the chairman of the House Financial Services Committee and one of the main Republican negotiators, said he wants to “trust the Treasury’s math, but they’re going to have to show their work.” He said the White House does not seem to have urgency in reaching a deal, raising questions about the June 1 date. 

Other House Republicans like Reps. Matt Gaetz (Fla.) and Ralph Norman (S.C.) have also questioned it. 

Republicans have demanded significant federal spending cuts in exchange for voting to raise the limit, while the Biden administration has sought to minimize the cuts made. 

Yellen noted that raising the debt ceiling does not allow the U.S. government to take on additional debts but pay off debts it has already incurred. 

“Essentially, we’ve bought things put on our credit card and then says we can’t pay the credit card bill. So, we simply must pay obligations that come due,” she said.