Bessent pushes Congress to address debt ceiling by mid-July to avoid defaulting on US loans

Treasury Secretary Scott Bessent on Friday sent a letter to Congress, urging lawmakers to either raise or suspend the debt ceiling by the time they go on their August recess to prevent the U.S. from defaulting on its loans.

The letter comes as lawmakers in both chambers work to pass their budget reconciliation bill, which includes plans to increase the debt ceiling and slash federal spending. 

The secretary urged them to come up with a solution before its annual break because there is a “reasonable probability” that the extraordinary measures the department is already implementing to pay off debts will run out in August.

“Therefore, I respectfully urge Congress to increase or suspend the debt limit by mid-July, before its scheduled break, to protect the full faith and credit of the United States,” he said, per CNN.

The debt ceiling was last suspended by Congress as part of a bipartisan bill in 2023 that was reached by former President Joe Biden and House GOP leadership, which pushed the threat of default until 2025. 

Bessent urged the lawmakers not to wait until the last minute to reach a new deal on the debt limit, stating it can have "serious adverse consequences for financial markets, businesses, and the federal government."

The Treasury Department has been using extraordinary measures and cash to pay off U.S. debts since January.

Misty Severi is a news reporter for Just The News. You can follow her on X for more coverage.