US Treasury Secretary Janet Yellen on Sunday said that a failure by Congress to act on the debt ceiling could lead to a "constitutional crisis" that would also call into question the federal government's creditworthiness.
Ms Yellen sounded the alarm over possible financial market consequences if the debt ceiling is not raised by early June, when she has said the federal government could run short of cash to pay its bills.
The negotiations on the issue should not take place "with a gun to the head of the American people", she told the ABC.
President Joe Biden has asked Congress to raise the debt ceiling without conditions.
The Republican-led House of Representatives last month passed a bill that would raise the government's $31.4 trillion debt ceiling, but it included sweeping spending cuts over the next decade, which Mr Biden and his fellow Democrats oppose.
Mr Biden is preparing to meet on Tuesday at the White House with Republican House Speaker Kevin McCarthy, Republican Senate minority leader Mitch McConnell and top congressional Democrats to discuss the issue.
"It's Congress's job to do this. If they fail to do it, we will have an economic and financial catastrophe that will be of our own making," Ms Yellen said.
"And we should not get to the point where we need to consider whether the President can go on issuing debt. This would be a constitutional crisis."
She was alluding to the delineation of powers of the executive and legislative branches under the US Constitution.
Mr Biden has steadfastly said he will not negotiate over the debt ceiling increase, but would discuss budget cuts after a new limit is passed.
Congress has often paired debt-ceiling increases with other budgetary and spending measures.
Washington regularly sets a limit on federal borrowing. Currently, the ceiling is equal to about 120 per cent of the country's annual economic output.
The debt reached that ceiling in January and the Treasury Department has kept obligations just within the limit, but by July or August, Washington could have to stop borrowing altogether.
Under that scenario, shockwaves could ripple through global financial markets as investors question the value of US bonds, which are regarded as among the safest investments and serve as building blocks for the world's financial system.
The House-passed bill would pare spending to 2022 levels and then cap growth at 1 per cent a year, repeal some tax incentives for renewable energy and stiffen work requirements for some anti-poverty programmes.
Specs
Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
Torque: 175Nm
Price: From Dh98,800
Available: Now
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More from Rashmee Roshan Lall
Call of Duty: Black Ops 6
Developer: Treyarch, Raven Software
Publisher: Activision
Console: PlayStation 4 & 5, Windows, Xbox One & Series X/S
Rating: 3.5/5
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
More from Neighbourhood Watch:
Tearful appearance
Chancellor Rachel Reeves set markets on edge as she appeared visibly distraught in parliament on Wednesday.
Legislative setbacks for the government have blown a new hole in the budgetary calculations at a time when the deficit is stubbornly large and the economy is struggling to grow.
She appeared with Keir Starmer on Thursday and the pair embraced, but he had failed to give her his backing as she cried a day earlier.
A spokesman said her upset demeanour was due to a personal matter.
UAE currency: the story behind the money in your pockets
FIXTURES
All kick-off times 10.45pm UAE ( 4 GMT)
Tuesday
Mairobr v Liverpool
Spartak Moscow v Sevilla
Feyenoord v Shakhtar Donetsk
Manchester City v Napoli
Monaco v Besiktas
RB Leipzig v Porto
Apoel Nicosia v Borussia Dortmund
Real Madrid v Tottenham Hotspur
Wednesday
Benfica v Manchester United
CSKA Moscow v Basel
Bayern Munich v Celtic
Anderlecht v Paris Saint-Germain
Qarabag v Atletico Madrid
Chelsea v Roma
Barcelona v Olympiakos
Juventus v Sporting Lisbon
GAC GS8 Specs
Engine: 2.0-litre 4cyl turbo
Power: 248hp at 5,200rpm
Torque: 400Nm at 1,750-4,000rpm
Transmission: 8-speed auto
Fuel consumption: 9.1L/100km
On sale: Now
Price: From Dh149,900
The specs
Engine: Four electric motors, one at each wheel
Power: 579hp
Torque: 859Nm
Transmission: Single-speed automatic
Price: From Dh825,900
On sale: Now
MATCH INFO
Uefa Champions League, last 16, first leg
Ajax v Real Madrid, midnight (Thursday), BeIN Sports
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Killing of Qassem Suleimani
Dust and sand storms compared
Sand storm
- Particle size: Larger, heavier sand grains
- Visibility: Often dramatic with thick "walls" of sand
- Duration: Short-lived, typically localised
- Travel distance: Limited
- Source: Open desert areas with strong winds
Dust storm
- Particle size: Much finer, lightweight particles
- Visibility: Hazy skies but less intense
- Duration: Can linger for days
- Travel distance: Long-range, up to thousands of kilometres
- Source: Can be carried from distant regions
Sole survivors
- Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
- George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
- Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
- Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
Naga
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COMPANY PROFILE
Name: Cofe
Year started: 2018
Based: UAE
Employees: 80-100
Amount raised: $13m
Investors: KISP ventures, Cedar Mundi, Towell Holding International, Takamul Capital, Dividend Gate Capital, Nizar AlNusif Sons Holding, Arab Investment Company and Al Imtiaz Investment Group
