US Could Run Out of Money by June 1

US Treasury Secretary Janet Yellen has warned that if Congress does not raise the federal debt ceiling, the US government could run out of funds by June 1. This would lead to a default.

According to the BBC, without raising the debt ceiling, US authorities will be unable to secure new loans. Yellen urged Congress to raise the ceiling, currently set at $31.4 trillion, as soon as possible.

US officials state that they are forced to take on more debt due to lower-than-expected income from income tax and higher-than-anticipated government expenditures. Additionally, at the beginning of the quarter, there were fewer funds in the government accounts than projected.

However, Republicans, who control the House of Representatives, oppose the spending plans announced by Democratic President Joe Biden. In exchange for agreeing to raise the borrowing limit, they demand significant cuts to government spending and the cancellation of key White House initiatives, including the student debt forgiveness program and tax credits for environmental technologies.