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The way to ensure the government can keep paying its bills is to raise or suspend the debt limit, Treasury Secretary Janet Yellen told lawmakers Friday — not prioritize payments, as some Republicans have proposed.
"In my assessment and those of economists across the board, a default on our debt would trigger an economic and financial catastrophe," Yellen said. "I urge all members of Congress to come together to address the debt limit without conditions and without waiting until the last minute."
The government reached the maximum amount it is able to borrow to pay the bills, known as the debt ceiling, in January. Lawmakers must act to raise or suspend that limit for the government to continue paying its bills, including paying its past debt built up under multiple administrations. The move would not greenlight new spending; that has been previously authorized by Congress — at issue is how to pay for what has already been spent.