Global Courant 2023-05-11 12:13:04
Janet Yellen, US Treasury Secretary, at a press conference on Thursday, May 11, 2023 at the meeting of Group of Seven (G-7) finance ministers and central bank governors in Niigata, Japan.
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Treasury Secretary Janet Yellen said the idea of US lawmakers to let the nation default on its debts should be “unthinkable”.
Speaking to reporters ahead of G-7 finance ministers’ meetings and central bank governors’ meetings in Niigata, Japan, Yellen said she was aware of former President Donald Trump’s suggestion to Republican lawmakers to default the nation.
“The idea of our debt defaulting is something that would undermine the US and the global economy so much that I think it should be considered unthinkable by anyone,” she told reporters. “America should never default.”
When asked about steps the Biden administration could take following bankruptcy, Yellen stressed that lawmakers should raise the debt ceiling.
“There is no good alternative that will save us from catastrophe. I don’t want to rank which bad alternative is better than others, but the only reasonable thing is to raise the debt ceiling and avoid the terrible consequences that will come.” ,” she told reporters, pointing out that debt default can be avoided.
“There is no good reason to create a proper crisis on your own. The US Congress has raised or suspended the debt limit nearly 80 times since 1960. I urge Congress to act quickly to do this again,” she said.
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Yellen’s comments come after she warned of an “economic catastrophe” if the US fails to raise the debt ceiling in the coming weeks. She has also previously warned that the US may not be able to meet its debt obligations sooner than expected – and that measures could run out as early as June 1.
Media reports last week quoted a Treasury official as saying her trip to Japan will be shortened to ensure she can continue to participate in efforts to tackle the debt ceiling problem.
She told journalists on Thursday: “Another meeting is scheduled for next Friday and staff are working to see if they can resolve this so I am hopeful that the differences can be bridged and the debt ceiling will be raised .”
