Yellen says using 14th Amendment to scrap debt limit would cause a 'constitutional crisis'

Treasury Secretary Janet Yellen repeatedly declined to rule out the possibility of declaring the debt ceiling unconstitutional if Congress fails to resolve its standoff, but said doing so would be a"not-good" option.

Amid the brinkmanship, some have suggested that President Joe Biden could invoke the 14th Amendment to scrap the debt limit and avert a default. Yellen warned that such action would trigger a constitutional crisis and also stressed that Congress must act quickly to forestall an economic calamity."There is no way to protect our financial system in our economy other than Congress doing its job and raising the debt ceiling and enabling us to pay our bills.

The 14th Amendment stipulates that the “validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.” However, the Constitution also grants Congress the power of the purse."If Congress fails to meet its responsibility, there are simply no good options. And the ones that you've listed are among the not-good options," Yellen added.

Yellen also re-upped her well-worn warnings that if Congress fails to up the debt limit,"economic chaos would ensue" that would unleash havoc on both the domestic and global economy. She insisted that there are no more tricks in the department's reserve to buy additional time.Biden is set to meet with congressional leaders, including House Speaker Kevin McCarthy , on May 9. McCarthy and Biden last met back in February. The United States rammed up against its $31.

Yellen recently estimated that those steps will run dry by June 1, giving Congress less than a month to resolve its differences. So far, neither side has shown signs of blinking, with Biden demanding a clean bill with no strings attached and McCarthy adamant that spending cuts be part of any deal.

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