United States Could Run Out of Money by June 1

United States Could Run Out of Money by June 1

By Ethan Russ, Staff Writer

On Monday, May 1, United States Secretary of Treasury, Janet Yellen, put out a statement, declaring that America could “be unable to continue to satisfy all of the government’s obligations by early June, and potentially as early as June 1.”

Essentially, the United States might be going broke.

Regarding the current state of affairs, Junior Matheus Campos said, “Overall, it’s a scary situation. It’s something that probably hasn’t happened before, and if it has, it happened a while ago. So it’s very scary.”

Yellen’s letter was written to Speaker of the House, Kevin McCarthy, and also called upon House Minority Leader, Hakeem Jeffries, and both the Senate Majority Leader, Chuck Schumer, and Senate Minority Leader, Mitch McConnell. Yellen claims a need for Congress to “raise or suspend the debt limit before that time.”

Several news outlets have reported that Biden will meet with McCarthy, Schumer, Jeffries, and McConnell to discuss the debt limit on Tuesday, May 9, to discuss the debt limit. There are a couple of avenues that Biden and the Democrats may pursue, but this is crunch time and they need to do whatever they can to prevent the US from defaulting (failing to be able to fulfill obligations, for example paying loans). The meeting between Biden and those congressional leaders is absolutely vital. They must come to an agreement quickly in order for Congress to whip votes (ensure enough people will be willing to vote in favor of the measure) before the measure is voted on. The tricky part is that in the next month or so before the predicted day of defaulting, the House and Senate will only convene on the same day eight times in total.

Regarding whether or not the opposing sides can come to an agreement before June 1, a History teacher, Mr. Hittinger, said “Yes, I do think that [there will be an agreement]. First off, I think that both Kevin McCarthy and Joe Biden have shown that they are able to reach across the aisle and be negotiators. Whether members of their parties have loved them bending is a different story, but I think Republicans, especially right now, need to be careful because the front-runner of their political party for president right now is someone who lost the previous election and so they cannot afford any more political setbacks. If they stand on their ground and say ‘We’re not going to bend down and we’re not going to negotiate with this’, then we go into default; the economy gets much, much worse; and their big talking point for beating Joe Biden, which is the economy is bad and we need to fix this, they now lose that talking point, so I think it is too imperative for Republicans to say ‘no, we’re not going to be able to come to an agreement’ and I’ve got faith in the Speaker of the House and the President that they will do what’s right for the American people.”

What’s at stake is a deep, deep recession that may have already started as a result of three recent bank failures. The waters are murky, the future is uncertain, and nobody can predict what will happen next. This would be the first time that America has defaulted, so nobody knows for sure what would happen.

Campos predicts that America will be “losing a lot of jobs. We’re going to be losing money for sure. A lot of people aren’t going to be making money and I feel like this is probably going to make us go into a recession or a new depression maybe.”

No matter whether or not America does default, this announcement shows great weakness in the American political system and a party-line divide would show an even more fractured government. This frailty could have lasting implications and a deep recession could begin due to the recent bank closures. After Biden’s recent announcement of his presidential bid for 2024, it may come as no surprise if he receives a primary challenge from other strong political candidates such as Secretary of Transportation, Pete Buttigieg, or even the nephew of John F. Kennedy, Robert F. Kennedy Jr., who has already launched his presidential campaign. Even with the potential fracturing of the Republican party, Biden could still receive a more than formidable challenge in the General Election as well.

The first time in history that the U.S. would default could be right around the corner and it would certainly be a day to forget for Americans and most of all, President Joe Biden.