Yellen, speaking on NBC’s “Face the Press,” said there would be tough choices if Congress failed to raise the $31.4 trillion debt ceiling before the Treasury Department don’t run out of money.
“I indicated in my last letter to Congress that we anticipate not being able to pay all of our bills by early June and possibly June 1. I will continue to update Congress, but I certainly have not changed my evaluation. So I think it’s an unavoidable deadline,” she added.
President Joe Biden is due to speak by phone with Republican House Speaker Kevin McCarthy on his return trip from the G7 summit in Japan to unblock debt ceiling negotiations.
Although Biden called the Republican proposals for the US debt ceiling “unacceptable,” at a Sunday press conference in Hiroshima, he stressed that a US default was not an option.
Biden has confirmed that he will not agree to a deal with Republicans in Congress on raising the debt ceiling and cutting the budget on their terms alone.
The Democratic administration and the Republican opposition are in a race against time to prevent the United States from defaulting on its obligations after June 1.
Republicans are demanding that Biden agree to a significant reduction in budget spending in return for agreeing to raise the debt ceiling, ignoring repeated Democrats’ demand for an unconditional increase in the public borrowing limit.
Democrats accused Republicans of using over-the-top tactics to advance their political agenda ahead of the time the United States would start defaulting on debt as the government ran out of money.
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