The U.S. government could be unable to pay all its bills on time if the debt limit isn’t raised or suspended by June 5, Treasury Secretary Janet L. Yellen said in a Friday afternoon letter.
Yellen updated Treasury’s estimate of when it will run out of cash and borrowing room to make payments in the letter to Speaker Kevin McCarthy. She had previously warned lawmakers that the department’s funds could run too low as soon as June 1, so the update offered slightly more breathing room as McCarthy and the White House work to negotiate a debt limit increase.
Yellen said Treasury will make more than $130 billion of scheduled payments — including Social Security, Medicare and veterans benefits — in the first two days of June, leaving the department with “an extremely low level of resources.” Treasury projects that it would then lack the resources to satisfy all of its obligations the week of June 5, which include an estimated $92 billion of payments and transfers.
