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Biden administration officials and Democratic economists are warning congressional leaders that if action is not taken soon to raise the country's $28.4 trillion debt limit, ruinous injury could be incurred by the American economy.
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In a letter to top lawmakers Wednesday, Treasury Secretary Janet Yellen characterized America's financial situation as teetering on the edge of catastrophe, noting that without intervention the U.S. government would run out of cash by next month.
"Based on our best and most recent information, the most likely outcome is that cash and extraordinary measures will be exhausted during the month of October," the secretary said.
As Congress deliberates raising the debt limit, Yellen warned that the uncertainty alone may inflict harm on the financial markets. She recalled the last debt limit standoff in 2011 that resulted in the United States' credit rating being downgraded for the first time ever.
