As President Joe Biden leaves town for the long Memorial Day weekend despite no deal being reached to raise the debt limit, Treasury Secretary Janet Yellen has again issued a letter with updated math to predict the date on which the United States will officially hit the debt ceiling and default on its obligations.
The Friday afternoon letter from Yellen to congressional leaders explained that "[b]ased on the most recent available data, we now estimate that Treasury will have insufficient resources to satisfy the government’s obligations if Congress has not raised or suspended the debt limit by June 5."
BREAKING: Letter from Sec. Yellen to congressional leadership.
— Shannon Bream (@ShannonBream) May 26, 2023
"Based on the most recent available data, we now estimate that Treasury will have insufficient resources to satisfy the government’s obligations if Congress has not raised or suspended the debt limit by June 5."
Previous estimates from Yellen said that the U.S. could default on its debt as early as June 1, but apparently the most current number-crunching bought negotiators a few more days before the "x-date." In her Friday letter, Yellen explained the reasoning behind her new default deadline of June 5:
We will make more than $130 billion of scheduled payments in the first two days of June, including payments to veterans and Social Security and Medicare recipients. These payments will leave Treasury with an extremely low level of resources. During the week of June 5, Treasury is scheduled to make an estimated $92 billion of payments and transfers, including a regularly scheduled quarterly adjustment that would result in an investment in the Social Security and Medicare trust funds of roughly $36 billion. Therefore, our projected resources would be inadequate to satisfy all of these obligations.
In her latest attempt to ratchet up the pressure for a deal to be reached — even though the whole ordeal could have been put to bed weeks ago if the Senate had passed the House's Limit, Save, Grow Act and Biden signed it into law — Yellen explained that she "used an additional extraordinary measure that Treasury has employed in a number of past debt limit episodes: a swap of approximately $2 billion of Treasury securities between the Civil Service Retirement and Disability Fund and the Federal Financing Bank."
Biden's Treasury secretary said that she employed this new measure because "the extremely low level of remaining resources demands that I exhaust all available extraordinary measures to avoid being unable to meet all of the government’s commitments."
Perhaps if things have been so "extraordinary" and dire, Yellen could have walked next door to the White House and nudged her boss — President Biden — to take up negotiations more than two months earlier than he did in order to avoid this brinkmanship? Or perhaps told him not to leave town for a long holiday weekend away from D.C.?
We can't get those 97 days back that President Biden wasted by refusing to negotiate. But I'm not just fighting for an agreement—I'm fighting for transformational reform that's worthy of the American people. pic.twitter.com/k2SauFleeZ
— Kevin McCarthy (@SpeakerMcCarthy) May 26, 2023
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