Yellen Says Debt Limit Reached, Taking Extraordinary Action

Treasury Secretary Janet Yellen walking out of a room.

Kevin Dietsch / Getty Images

Treasury Secretary Janet Yellen said the U.S. reached the maximum amount it can legally borrow, and the Treasury Department started taking “extraordinary measures” to pay the country’s bills.

In a letter to House Speaker Kevin McCarthy, Yellen indicated that because of the debt limit, the Treasury will no longer be able to fully invest the portion of the Civil Service Retirement and Disability Fund not immediately required to pay beneficiaries, and that the suspension will last through June 5. She noted that the same steps would be taken with the Postal Service Retiree Health Benefits Fund. 

Yellen warned that the length of time these extraordinary measures may last “is subject to considerable uncertainty,” which includes challenges of forecasting the payments and receipts of the government months from now. She called on Congress to “act promptly to protect the full faith and credit of the United States.” Last week, she told McCarthy failure to meet the government’s fiscal obligations would cause “irreparable harm to the U.S. economy, the livelihoods of all Americans, and global financial stability.”

Chart showing debt limit raises since 1959.

Peter G. Peterson Foundation

Jamie Dimon Responds

JPMorgan Chase CEO Jamie Dimon weighed in on the subject in an interview at the World Economic Forum in Davos, Switzerland, arguing that Congress should not be “playing games” with the debt ceiling. He explained that the creditworthiness of the U.S. should never be questioned, adding “That is sacrosanct and it should never happen.” 

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  1. U.S. Department of the Treasury. "Debt-Limit-Letter-to-Congress-20230119-McCarthy." Page 1.