Bessent urges Congress to act on debt limit by mid-July

Treasury Secretary Scott Bessent called on Congress Friday to raise the nation’s debt ceiling by mid-July to keep the federal government from defaulting on its more than $36 trillion debt.

In a letter to Speaker Mike Johnson (R-La.), Bessent said there is “reasonable probability” that the government’s “cash and extraordinary measures will be exhausted in August while Congress is scheduled to be in recess.”

“Therefore, I respectfully urge Congress to increase or suspend the debt limit by mid-July, before its scheduled break, to protect the full faith and credit of the United States,” he said.

Republicans are hopeful they will be able to raise the debt limit on their own this year using a process known as budget reconciliation. The aim is to raise the debt ceiling using the same vehicle being put together to advance wide swaths of President Trump's agenda with only GOP votes.

This would allow Republicans to avoid Democratic demands for concessions in exchange for their votes, but it would also set a hard mid-summer deadline for the massive bill that has spawned numerous divisions on the right.

The debt limit was last suspended by Congress as part of a bipartisan bill struck between former President Biden and GOP leadership in 2023, staving off the threat of national default through early 2025. 

However, then-Treasury Secretary Janet Yellen said in January that the government would have to implement “extraordinary measures” after the government was expected to reach the new limit later that month. 

The debt limit caps how much money the Treasury Department can owe to pay the country’s bills.

Trump urged the previous Congress to raise the debt limit before he assumed office, as Republicans argued Democrats could use the leverage point to demand major concessions.

House GOP leaders also used the debt limit during the Biden administration to get Democrats to come to the negotiating table, but only after months of an intense game of chicken between both sides. The high stakes battle eventually resulted in a debt limit suspension and a bipartisan deal for new limits on spending, but not without another downgrade of the nation’s credit rating. 

In his note to lawmakers on Friday, Bessent said “prior episodes have shown that waiting until the last minute to suspend or increase the debt limit can have serious adverse consequences for financial markets, businesses, and the federal government, harm business and consumer confidence, and raise short-term borrowing costs for taxpayers.”

“These risks were underscored by the Treasury Borrowing Advisory Committee in a report issued on April 29, 2025, raising concerns including increased volatility and costs, negative impacts on U.S. financial strength, and a heightened risk of a default,” he said. 

Updated at 5:14 p.m. EDT