NEW YORK, Sept 23 — The chairman of the US Federal Reserve called on lawmakers to raise the nation’s borrowing limit urgently on Wednesday, warning that failure to pay government debts would do “severe damage” to the economy. “It’s just very important that the debt ceiling be raised in...
NEW YORK, Sept 23 — The chairman of the US Federal Reserve called on lawmakers to raise the nation’s borrowing limit urgently on Wednesday, warning that failure to pay government debts would do “severe damage” to the economy.
However, the plea for quick action looks set to fall on deaf ears, as the opposition leader in the Senate has steadfastly refused to cooperate with the ruling Democrats to increase the debt ceiling.The Democratic-controlled House of Representatives passed a measure that would suspend the debt limit until after next year’s midterm elections and fund government operations until December 3.
And the group of former finance ministers — who served under presidents Jimmy Carter, George W. Bush, Bill Clinton and Barack Obama — said in a letter to congressional leaders of both parties that even a short-lived default could threaten economic growth. They said protecting the “unshakeable creditworthiness” of the United States “is a sacrosanct responsibility.”But Republican Senate leader Mitch McConnell continues to use the debt limit as a political bludgeon to protest President Joe Biden’s spending plans — although he argued in favor of increasing the cap under former president Donald Trump.
The debt deadline looms as Democrats are hoping to secure a sweeping US$3.5 trillion social policy package on a party-line vote, without dealing with Republicans. “People wonder why is it different this time, given the fact that over the last 80 years the debt ceiling has been raised 98 times,” Senate Republican Conference chairman John Barrasso told a news conference.
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