The threat that the U.S. federal government won't be able to pay all of its bills by its already extended Aug. 2 looms large, but Treasury Secretary Timothy Geithner has another warning: If the nation's $14.3 trillion debt ceiling isn't raised, seniors reliant on Social Security and Medicare will be hurt.
I want to again encourage Congress to move as quickly as possible, so that all Americans will remain confident that the United States will meet all of its obligations - not just our interest payments, but also our commitments to our seniors, Geithner said.
The Republican leadership in Congress has expressed doubt about the need to raise the national debt ceiling, claiming that Geithner is exaggerating the danger. They are refusing to vote for the raise unless the White House and its Democratic supporters agree to long-term spending cuts.
The Obama administration has said they could agree to cuts, but will also demand some tax hikes to increase revenues.
Geithner said Congress's failure to act in a timely manner to raise the debt ceiling has forced the Treasury to begin a series of extraordinary measures that will give the legislature time to raise the ceiling.
U.S. Federal Reserve chairman Ben Bernanke warned politicians Thursday to raise the debt limit soon or risk destabilizing the financial system.