the United States forced to take “extraordinary measures” to avoid payment default

The world's largest economy will have to contort itself to avoid default. In a letter sent Friday, January 17 to key Congressional officials, outgoing Treasury Secretary Janet Yellen warns that the debt ceiling, currently located slightly above $36,000 billion (35,000 billion 'approximately euros), “does not authorize new spending”.

Of the “extraordinary measures” will therefore be taken starting Tuesday, January 21, the day after the inauguration of President-elect Donald Trump. Among them, the cessation of payments to several retirement, health or disability funds for public employees – technical adjustments “which are not immediately necessary for the payment of benefits”. “Retirees and public sector employees will not be affected by these actions”he is assured.

This type of measure makes it possible to freeze expenses and avoid falling behind on the payment of invoices, which would penalize state suppliers and more generally the economy. They can only be temporary, until Congress raises or suspends the debt ceiling. If parliamentarians fail to reach an agreement, the United States could ultimately find itself in default.

“Preserve the full confidence” of creditors

Janet Yellen emphasizes that the length of time the extraordinary measures will last is “subject to a lot of uncertainty, particularly due to the difficulty in forecasting government spending and revenue in the months to come”. Before handing over, the outgoing minister calls “respectfully Congress to act quickly to preserve full confidence” creditors to the United States.

To rebalance public accounts, while continuing the tax cuts implemented during his first term, Donald Trump promises to slash federal government spending and is counting on revenues from additional customs duties that he wants to set up.

On Wednesday, before an economic club in New York, Janet Yellen warned against a deepening “disastrous” of the public deficit after his departure. During her speech, the outgoing minister cited forecasts from the Congressional Budget Office (CBO), an independent organization responsible for providing the American Congress with budgetary and economic analyzes, according to which the simple perpetuation of the tax cuts of the first mandate of Donald Trump would worsen the deficit by $400 billion per year.

“Such policies could weaken our country”she added, citing the risks on “the value of the dollar” such as the capacity of the State to finance itself on the markets, up to the specter of a “debt crisis”. M^me Yellen said that such a situation “would weigh heavily on future generations”.

The debt ceiling, a recurring subject in the United States

“The United States will not default on its debt if I am confirmed” as new Secretary of the Treasury, Scott Bessent, Donald Trump's choice for this position, told senators on Thursday.

The increase, or suspension, of the debt ceiling is a recurring subject in the United States, with 78 changes since 1960 – 49 times under a Republican president and 29 times under a Democratic president, according to the Treasury Department website.

An official report published Friday anticipates that public debt will represent 118% of United States GDP in 2035, compared to 100% in 2025.