“This is why no President or Treasury Secretary of either party has ever tolerated even the suggestion of a breach of a US obligation,” Yellen wrote.
However, Senate Minority Leader Mitch McConnell, R-Ky., Threatened this week that all Republican senators would vote against extending the government’s borrowing power. He cited objections to President Joe Biden’s plans to increase domestic spending and raise taxes for the rich.
If that happened, Senate Democrats wouldn’t have the 10 GOP supporters they would need to overcome Republican obstruction or delaying tactics, and push that language through the Senate to 50-50 with 60 votes.
Democrats have yet to decide on a legislative strategy to deal with a debt limit deadlock.
But Yellen’s letter could prompt them to include a provision extending the debt limit in a bill that Congress will have to approve by October 1 to prevent a government shutdown that day. Recurrent expense bills funding federal agencies for the fiscal year beginning Oct. 1 are unlikely to have been promulgated by then.
This tactic would dare Republicans to block a bill that, if defeated, could result in both a federal shutdown and default. Most politicians would hesitate to be blamed for such events, especially as an election year approaches.