United States Secretary of Treasury Janet Yellen has said that the US Congress must take immediate action to bring the US into line with a global minimum tax agreed on last week by 136 countries of the world and also create consensus to resolve the debt crisis. Recently, the Organization for Economic Cooperation and Development (OECD) hosted negotiations with multinational companies and the global Community has agreed to enforce a minimum corporate tax rate of 15% during the coming days. Presently, a debate on the next year proposed spending bill of US $ 3.5 trillion, is underway among the Democrats lawmakers and many house representatives want to curtail the bill up to 2 trillion dollars. However, Secretary Janet warned the house about the consequences if Congress failed to further raise or suspend the US debt ceiling.
The Republicans are resisting the long-term suspension of the ceiling but expressed willingness to cooperate with the administration on a temporary solution of the problem. According to reports, US
Senate has approved $ 480 billion as temporary relief which will be helpful to run the government’s business up to December this year and Will provide time to the administration to tackle the situation. If the US fails to meet its financial obligations, then the country would face an imminent risk of a self-inflicted recession, degrading of credit rating and will plunge the international economy into a crisis. Therefore, the Biden administration intends to increase the ceiling to avoid the situation.
In fact, like many other countries of the world, the previous US administrations had been pursuing ambitious plans despite availability of scanty financial resources due to which US debt has touched its ceiling. Presently, Democrats are working for an increase in the debt ceiling whereas Republicans gave them a temporary relief and yet are not ready to ease the problem of their political rivals in the long term. According to experts, if the US Congress could not resolve the issue by December 2021, then the US administration would have to borrow money for the first time in history. Hopefully, the Biden administration will resolve the issue during the coming days, however the US economy is facing serious problems relating to its survival, and this situation has posed a challenge for US administration, Intelligentsia and US lawmakers, how they will drive the US economy from this crisis.