Yellen: "We're ready to talk to Republicans about budget deficit reduction.
Janet Yellen said she is willing to negotiate with Republicans in Congress over the Joe Biden administration’s budget proposal, which will be released next month, but not on the terms of the debt ceiling increase.
Yellen noted that President Biden’s administration’s budget for fiscal year 2024 would include “significant deficit reduction over the next decade.”
“And we’re going to show how we’re going to achieve that,” she added on the sidelines of the G20 financial leaders meeting, “Republicans have to put their plan on the table, and then negotiations or discussions about it will certainly be possible, but it cannot be a primary or even a precondition for raising the debt ceiling.”
Republicans, who have some majority in the U.S. House of Representatives, demanded that President Joe Biden agree to spending cuts in exchange for raising the national debt ceiling.
Yellen stressed that the United States “cannot bargain over whether the bills are going to be paid or not. It’s just a fundamental responsibility of the government.”
The U.S. Treasury secretary explained that tax returns collected around the April 15 deadline could allow some adjustments to the department’s estimate of when it can no longer pay all of the government’s bills without raising the debt limit, now at $31.4 trillion.
The Treasury Department has not yet changed its early estimate for that time period to June, made last month, although the Congressional Budget Office estimated that the cash and emergency Treasury borrowing measures could extend through September.
“The tax returns will allow us to determine information regarding a possible ‘date X,'” the secretary stated, referring to the commonly used term in Washington for a potential date of default.
“We felt comfortable telling Congress that we could at least get to early June,” Janet Yellen concluded.
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