In a letter to Speaker of the U.S. House of Representatives Nancy Pelosi (D-CA) the Treasury Secretary of the Biden-Harris regime’s Janet Yellen threatened that “extraordinary measures” would be necessary to prevent the United States from entering sovereign default if Congress is unable to raise the debt ceiling or reduce spending by August 2nd. This is a customary part of every debt battle that may (or does) result in a Government shutdown. The Treasure will take more and more aggressive (and desperate) measures as the debt crisis persists in an attempt to prevent the Federal Government from defaulting on its financial obligations.
Treasure Secretary Yellen Is Running Out Of Tricks
First and foremost, the Treasury will suspend all sales of State and Local Government Series Treasury securities, the main avenue through which the Government can finance its debt. Then Yellen will direct her staff to declare a “Debt Issuance Suspension Period”, redeem all existing, and suspend any new, investments of the Civil Service Retirement and Disability Fund and the Postal Service Retiree Health Benefits Fund.
As the situation progresses further, the temporary reprieves will grow less and less effective with the Treasury turning to the Government Securities Investment Fund of the Federal Employees Retirement System. Retirees from the Federal Government will continue to draw checks until the funds freed up by the “extraordinary measures” are exhausted, at which point it will no longer have the ability to make payments across the government.
Finally, Yellen will suspend the daily reinvestment of Treasury securities held by the Exchange Stabilization Fund (ESF) which frees up about $22 Billion. Just to give you an idea, given past spending habits of the Government in the last two decades, even Yellen doesn’t know how long the “extraordinary measures” will keep the Government afloat, but it will certainly be measured in weeks, if not: days.
“The period of time that extraordinary measures may last is subject to considerable uncertainty due to a variety of factors, including the challenges of forecasting the payments and receipts of the U.S. government months into the future, exacerbated by the heightened uncertainty in payments and receipts related to the economic impact of the pandemic,” Yellen told Pelosi in a letter.
According to CNBC, “Economists say default, though extremely unlikely, would be a catastrophic event and would pose a significant threat to several sectors of the American economy.” The economy, weakened as it has already been by the COVID19 panic and globalist-directed lockdowns can ill sustain another hard jolt. And the nation is stood upon a razor’s edge with mass unrest threatening to break out again at any time. The description of a “catastrophic event” only covers the economic implications, from a social and cultural standpoint, this could be apocalyptic.
Senate Majority Leader Chuck Schumer couldn’t be further away from any possible compromise, he doesn’t even seem to be interested in one. Speaker Pelosi’s House (it ceased to be “The People’s House” on Jan. 6th) insist that they WILL NOT pass a bill on budget and infrastructure that doesn’t also lump in paid worker leave, labor education and other leftist fever-dreams. And Minority Leader Mitch McConnell said
“I can’t imagine there will be a single Republican voting to raise the debt ceiling after what we’ve been experiencing,” “I can’t imagine a single Republican in this environment that we’re in now — this free-for-all for taxes and spending — to vote to raise the debt limit,”
Senate Minority Whip John Thune (R-SD) was asked if the GOP would consider a standalone debt ceiling increase to ‘kick the can down the road’, he said,
“I can’t imagine a single Republican in this environment that we’re in now — this free-for-all for taxes and spending — to vote to raise the debt limit, You would think, based on what they’re talking about doing, that Bernie Sanders had won the election.”
In short: House and Senate Democrats are playing a wonderful game of projection, blaming the GOP for “holding the economy hostage” when in fact THEY are the party with the gun to the head of the American people, making demands for more and more unbelievably and unacceptably partisan spending. They are content to drive us straight into the fire, trusting the Republicans to blink first. The GOP under McConnell and House Minority Leader McCarthy, need to let them burn. The American people will survive, the Government might not.