Yellen Warns: US Debt Limit Looms

Hey there, let's talk about something important happening in the US right now. Janet Yellen, the Treasury secretary, just sent a letter to Congress saying we're about to hit our debt limit. That's the amount of money the government can borrow. Yellen said they'll start using some special tricks to keep the government running, but they really need Congress to step in and raise the limit. This is happening because the government's debt has been growing for a long time, and now it's getting close to the limit set by Congress. In the past, the government has used these tricks to keep things going, but they can only do that for so long. If Congress doesn't act, the US could default on its debts, which would be a big deal. This is all happening because of a law passed last year that suspended the debt limit until January 1. But now, we're just a few weeks away from that deadline. You might be wondering why this is such a big deal. Well, the federal debt is huge, like over $36 trillion huge. And with inflation and the pandemic, it's getting even bigger. Next year, the government will spend more on paying off its debt than on national security. That's a lot of money! Republicans, who will have control of the government next year, want to extend some tax cuts and other stuff. But they're also worried about how to pay for it all. That's where this debt limit comes in. They'll have to figure out how to raise or suspend it to keep the government running. So, it's like a big game of chicken. Congress needs to act, or the US could be in some serious trouble. But with all the different opinions and plans, it's not clear what will happen.