Treasury Department Warns of Potential Government Default in Coming Week, Urging Congress to Act Quickly to Avoid Financial Crisis

The U.S. Treasury Department has warned that the government could run out of money to meet all its obligations as soon as June 1, due to House Republicans’ efforts to take the government hostage. Goldman Sachs projects the date could be closer to June 8 or 9, while the Bipartisan Policy Center says the date is likely earlier.

The Treasury Department has been using workarounds, or “extraordinary measures,” to keep the government paying its bills on time, but Secretary Janet Yellen says those efforts will be exhausted in the coming week. Roughly $98 billion worth of benefits — including Medicare, Medicaid, Social Security and military and civil retirement payments — are scheduled to go out in the first two days of June.

The Bipartisan Policy Center has warned that Social Security recipients, seniors and people with disabilities will likely be the first groups directly affected if the U.S. is unable to pay its obligations. This could have a devastating impact on those who rely on these benefits for their livelihood.

The Treasury Department is urging Congress to act quickly to avoid a potential financial crisis. It is unclear what the consequences of a government default would be, but it could have far-reaching implications for the U.S. economy. It is essential that Congress take action to ensure that the government can meet its obligations and avoid a potential disaster.