Jakarta, CNBC Indonesia – Secretary of the Treasury of the United States (US) Janet Yellen said the country is likely to fall into a recession. The warning will come true if Congress fails to approve the federal government’s borrowing limit bill in the near future.
If the regulation is not issued, the government cannot add fresh funds to pay its debts. This will have implications for the possibility of a US default that has never happened in the country’s history.
“I think of October 18 as the deadline,” Yellen said in an interview with CNBC’s “Squawk Box.”
“It will be a big disaster,” he said again. “I fully see this will lead to a recession.”
Meanwhile, US President Joe Biden asked Congress to raise the debt limit this week. He emphasized this to avoid an almost certain economic turmoil.
Biden, a Democrat, blamed Republican Senate leader Mitch McConnel. It is considered to preclude a law that would raise the loan limit.
The reason is that the bill was previously approved by the US House of Representatives. But last week, when the debate was brought to the U.S. Senate, given the concept of a two-chamber legislature, the Republican Senate unified it.
Currently the US government debt limit is US $ 28.4 trillion. Assuming US$ 1 is equivalent to Rp 14,315 as the middle rate of Bank Indonesia (BI) October 1, 2021, the amount will be Rp 406,546 trillion.
Previously so that the government did not shutdown, Biden has signed a policy to fund the government’s needs until December 3, 2021. This was previously considered the Republican Senate the best way to go than adding to debt.
But the problem is not over yet. The regulation is limited, only as a legal umbrella for the government’s operational budget and needs that have been previously budgeted such as the placement of Afghan refugees amounting to US$ 6.3 billion and aid for disaster victims of US$ 28.6 billion.
(boss / boss)
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