Treasury Secretary Janet Yellen said in an interview published Sunday that Republican calls for spending cuts in exchange for agreeing to raise the debt ceiling were “very irresponsible.”
In an interview with The Associated Press published Sunday, Yellen said the GOP’s stance on the debt ceiling could have far-reaching consequences for the economy.
“It is possible for markets to become quite concerned about whether or not the U.S. will pay its bills,” Yellen told the newswire.
The Biden administration has warned that an extended standoff over the debt ceiling could destroy faith in the credit of the U.S. government and spur a deep economic recession.
Republicans are using the debt ceiling as a point of leverage in an effort to freeze spending at 2022 levels, in a move that has raised particular concerns over potential cuts in defense spending.
The White House has so far refused to negotiate, pointing to clean votes to raise the debt ceiling under the Trump administration.
Yellen, who spoke to the AP while on a trip in Africa, said she has not yet spoken with House Speaker Kevin McCarthy (R-Calif.) on the issue.
“Congress needs to understand that this is about paying bills that have already been incurred by decisions with this and past Congresses and it’s not about new spending,” Yellen said.
“But it can’t be negotiated over whether or not we’re going to pay our bills,” she added.
The U.S. reached its technical borrowing limit of around $31.4 trillion last week, with the Treasury Department saying it will take “extraordinary measures” to make sure that the government’s bills are fully paid until around June.
The White House said on Friday that President Biden plans to meet with McCarthy in discussions on various topics.
“Congress has to do it,” Yellen said of raising the debt ceiling. “It has to be done. It can’t be something that’s contingent on cuts.”