Former Treasury Secretaries Urge That US Debt Limit be Raised 'Without Delay'
18:14 GMT 22.09.2021 (Updated: 18:20 GMT 22.09.2021)
© REUTERS / ANDREW KELLYSignage is seen at the United States Department of the Treasury headquarters in Washington, D.C., U.S., August 29, 2020.
© REUTERS / ANDREW KELLY
WASHINGTON (Sputnik) - A group of six former US Treasury secretaries urged on Wednesday for the country’s debt limit to be raised promptly and not let a politically divided Congress cause the world’s largest economy to default on its fiscal commitments.
“No Congress or President has allowed our country to default,” the group comprising former Treasury secretaries Michael Blumenthal, Henry Paulson, Robert Rubin, Timothy Geithner, Lawrence Summers and Jacob Lew said in a joint letter to House Speaker Nancy Pelosi. “Unshakeable credit worthiness has long been a wellspring of strength for our nation, and protecting it is a sacrosanct responsibility. This makes it all the more important that Congress and the Administration begin the process to extend the nation’s borrowing authority without delay.”
House Democrats on Tuesday approved legislation to keep the government funded through early December, lift the limit on federal borrowing through the end of 2022 and provide emergency money for Afghan refugees and natural disaster recovery. But their Republican rivals have expressed unwillingness to back the measure in the Senate.
A bill to raise the US debt limit is needed to avert a government shutdown when funding lapses next week.
In their letter to Pelosi, the former Treasury secretaries said they recognised that over the years, America’s politics “has become more polarised and divisive” and addressing the debt limit “has become more contentious and politically fraught.”
They noted that the United States has paid all its bills in full and in time over the past 232 years and warned that even a short-term default resulting from the political fallout could have serious repercussions for the US economy.
“Failing to address the debt limit, and allowing an unprecedented default, could cause serious economic and national security harm,” the former Treasury secretaries said. “It creates the risk of roiling markets and of sapping economic confidence, and it would prevent Americans from receiving vital services. It would be very damaging to undermine trust in the full faith and credit of the United States, and this damage would be hard to repair.”
The White House warned in a memo last week that the economy could fall into recession if Congress does not reach a deal to raise the country’s debt limit promptly.