File photo: Capitol Hill. Photograph:( Others )
US Treaury has already warned that governemnt will run out of money unless lawmakers move to take action on the issue
Leaders of the Republican Party in US Congress on Tuesday continued withholding support to increasing US debt ceiling. The efforts to raise the debt ceiling have been initiated by the Democratic Party.
Last week, Treasury Secretary Janet Yellen warned that the government will run out of money next month unless lawmakers take action. Banking groups have urged Congress to act to prevent "irreparable harm" to US economy.
Republican Senate Minority Leader Mitch McConnell said Democrats will have to resolve the issue on their own.
"The Democratic leaders have every tool and procedure they need to handle the debt limit on a partisan basis, just like they are choosing to handle everything else," McConnell said on the Senate floor.
Congress is currently considering a $1.2 trillion infrastructure plan that has the backing of Democrats and some Republicans.
Also on their agenda is a massive social spending plan costing $3.5 trillion over 10 years, which has only garnered the support of Democrats who plan to pay for it with tax increases on corporations and the wealthiest Americans.
McConnell objects to what he called a "massive reckless tax and spending spree."
Amazon CEO Andy Jassy called for raising the debt ceiling in an interview with CNBC.
"I think it's scary for consumer confidence and for confidence in US businesses and potential credit ratings if we don't make sure that we raise that debt ceiling," Jassy said.
The Securities Industry and Financial Markets Association (SIFMA), American Bankers Association and other industry groups said in a letter to congressional leaders that defaulting "on our existing obligations would be irresponsible and do irreparable harm to the US economy and taxpayers."
Even "a short-term delay would cause serious harm at a time when our economy continues to recover from the impact of the Covid-19 pandemic," the letter read.
USA's debt and deficit have increased during Covid-19 pandemic.
(With inputs from agencies)