Republican demands for spending reductions in return for agreeing to increase the debt ceiling were deemed extremely foolish, according to Treasury Secretary Janet Yellen, in an article released on Sunday.
Yellen stated the GOP’s position on the debt ceiling might have significant effects on the economy in a conversation with The Associated Press that was released on Sunday.
According to Yellen, it is possible for markets to grow fairly anxious as to whether or not the U.S. would fulfill its payments.
The Biden administration has issued a warning that a protracted dispute over the debt ceiling might undermine confidence in the U.S. government’s credit and trigger a severe economic downturn.
Republicans are attempting to limit spending at 2022 levels by using the debt ceiling as leverage; this action has caused particular worry regarding probable reductions in defense spending.
By citing unanimous votes to increase the debt ceiling during the Trump administration, the White House has so far declined to engage in negotiations.
“Congress needs to understand that this is about paying bills that have already been incurred by decisions with this and past Congresses and it’s not about new spending,” Yellen said.https://t.co/35SAlCHJno
— Melissa (@Proudmimi12) January 23, 2023
Yellen, who talked to the AP while traveling in Africa, said she hasn’t yet had a conversation about the matter with House Speaker Kevin McCarthy.
Yellen said this is about making payments that have already been generated, due to decisions made by this and previous Congresses, not about fresh spending. Whereas the question of whether they will pay their debts cannot be negotiated, she continued.
The Treasury Department announced last week it will take “exceptional steps” to ensure the government’s debts are properly paid until approximately June, despite the fact the US surpassed its theoretical borrowing limit of almost $31.4 trillion.
Yellen: GOP demand to link spending cuts to debt limit increase 'very irresponsible' https://t.co/zH0tnXoC8C (TheHill)
Treasury Secretary Janet Yellen said in an interview published Sunday that Republican calls for spending cuts in exchange for agreeing to raise the debt ceili…
— Pray for POTUS (@PrayforPOTUS) January 23, 2023
President Biden and Speaker McCarthy will meet on Friday, according to a statement from the White House; they’ll talk about a variety of issues.
Congress must raise the debt ceiling, according to Yellen. It must be completed. It cannot be anything that depends on budget reduction.
Sen. Joe Manchin, a Democrat from West Virginia, said on Sunday the White House made an error by insisting Democrats raise the debt ceiling without first engaging in negotiations with congressional Republicans.
Manchin Believes in Democracy
Manchin said he feels they need to discuss it, so he thinks it’s a mistake. He continued by saying we live in a democratic society.
Given that we have a two-party system, we ought to be able to communicate and work out our disagreements. Key Senate moderate Manchin told CNN’s Dana Bash on “State of the Union” that if the differences cannot be resolved, you must go on and let the public decide.
Manchin stated using the debt ceiling and keeping it hostage has not yet been successful in the past, adding that he respectfully disagrees with Majority Whip Dick Durbin, the No. 2 Democrat in the chamber, on not engaging in negotiations with Republicans.