Treasury Secretary Janet Yellen told Congress on Friday that she will start taking emergency measures next week to keep the government from an unprecedented default on the national debt.
In a letter to House and Senate leaders, Yellen said that her actions would buy time until Congress can pass legislation to either raise the debt limit or suspend the limit again for a period of time.
The debt limit has been suspended for the past two years but will go back into effect on July 31.
Yellen said her first move on July 30 will be to suspend the sale of state and local government securities, which are used by some local jurisdictions to meet some of their financing needs but increase the level of debt held by the federal government.
If Congress has not acted to either raise the debt limit or suspend it by Aug. 2, Yellen said she will be taking “certain additional extraordinary measures in order to prevent the United States from defaulting on its obligations.”
Senate Republican Leader Mitch McConnell said earlier this week that he believes all Republicans will vote against raising or suspending the debt limit, which prompted Senate Majority Leader Chuck Schumer, D-N.Y., to call the comments “shameless, cynical and totally political.”