U.S. Treasury Secretary Jack Lew urged Congress during a speech before the Commonwealth Club of California last week to honor its previous spending commitments by raising the debt limit.
Lew said Congress needs to act quickly to “avoid jeopardizing the full faith and credit” of the U.S. and to avoid the consequences of default or the threat of default.
“It is important to note that the debt limit has nothing to do with new spending,” Lew said. “It has to do with spending that Congress has already approved and bills that have already been incurred. Failing to raise the debt limit would not make these bills go away. It would, though, have disastrous effects for our nation. We cannot afford for Congress to wait until some unknowable last minute to resolve this matter on the eve of a deadline. We cannot afford another unnecessary self-inflicted wound.”
The White House has said previously that it will not negotiate on raising the debt limit, The Hill reports.
Lew said tax revenue and expenditures are unpredictable, which would make it virtually impossible for the Treasury to predict when the government will run out of options to continue paying its bills. Additionally, Lew urged Congress to replace spending cuts that took effect in March.
“Nearly every part of the federal government is coping with an onslaught of these reckless, across-the-board reductions,” Lew said, according to The Hill. ”These cuts are harming the middle class, hampering growth, and hindering job creation in communities, like this one, all across the country.”