Washington. US Treasury Secretary Janet Yellen said that defaulting on the US government’s debt repayment of $31.46 trillion could lead to a worldwide economic crisis. US Treasury Chief Yellen urged Congress to raise the $31.4 trillion federal debt ceiling and avoid an unprecedented default. Yellen said that if this could not happen, then there would be a danger of economic recession all over the world, and the risk of weakening of American’s worldwide economic leadership would also increase greatly.
Yellen issued stern warnings ahead of a meeting in Japan with the Group of Seven nations: the G7 as well as the finance ministers of India, Indonesia and Brazil. Yellen said that a default in repaying the debt would risk erasing the gains that have been achieved in the past few years by working hard to recover from the epidemic. At the same time, it will lead to a global recession, which will take America further back. This will also increase the risk on the interests of the country’s national security. Yellen said that the crisis has arisen due to the non-cooperation of the Republican Party on this issue. The threat of default could lead to a downgrade in the credit rating of the US government. As happened in 2011 during the tussle over raising the debt ceiling.
Significantly, US President Joe Biden had already said that if the Congress does not approve the increase in the debt limit before the Treasury runs out of money to pay the government’s bills, then there is a risk of the US economy getting stuck in recession from June 1.
