US hits debt ceiling, Treasury Department takes ‘extraordinary measures’

The US hit its debt limit on Thursday, prompting the Treasury Department to take “extraordinary measures” to continue financing the federal government.

Treasury Secretary Janet Yellen announced in a letter to House Speaker Kevin McCarthy that her department would put the temporary brakes on new investments in a few government retirement funds, from Thursday until June 5.

Those include the Postal Service Retiree Health Benefits Fund and a couple of others, Xinhua news agency reported.

Yellen said such moves could allow the federal government to pay its bills until June.

At the same time, she said there would be “considerable uncertainty” around those actions, should Congress fail to pass legislation to increase the $31.4 trillion debt ceiling.

According to the Government Accountability Office, US lawmakers have increased the nation’s debt ceiling 22 times since 1997.

Republicans, who now control the House by a slim margin, want to tie any debt-raising legislation to spending cuts. This occurs at a time when the US government has spent so much that it has sparked the worst inflation in four decades.

Many economists have blasted the recently-passed omnibus bill, worth $1.7 trillion, as loaded with frivolous spending.

The White House said it would not compromise on raising the debt ceiling.

Failing to increase the debt ceiling could lead to a default on US debt that could unleash economic calamity worldwide.

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