White House warns of economic catastrophe without action on debt limit By Reuters
WASHINGTON (Reuters) – The White House warned on Friday that a failure by the U.S. Congress to extend the debt limit could plunge the economy into a recession and could lead to cuts in critical state services.
After the October deadline, which is set by Congress for extending its debt limit, the government may be unable to pay any of its bills without approval from Congress.
Biden (a Democrat) and his aides tried to reach a compromise with Republicans in order to end a row over the federal borrowing limit of $28.5 trillion.
Warning lawmakers, the government is warning that there are risks of a country facing a new financial crisis as well as defaulting on its payments obligations.
The White House released a new factsheet saying that “economic growth would slow, unemployment will rise and the labor force could lose millions”
Janet Yellen, Treasury secretary, has been urging Congress to act for several months. Janet Yellen stated in a new fact sheet that October will see the end of cash and extraordinary measures being temporarily used to fund the U.S. Government.
Republicans lost control of both the Senate and House of Representatives in 2020 and are now in decline. They have argued that the Democrats should handle the crisis.
Brian Deese, White House economic adviser, stated to MSNBC that “it’s completely unspeakable, and unthinkable” that the Federal Government would default on obligations it had already taken.
“We are certain that this will happen.
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