Thu, June 02, 2011
World > Americas

Failure to raise debt ceiling bears "dire consequences" for global economy: White House

2011-06-02 02:38:10 GMT2011-06-02 10:38:10(Beijing Time)  Xinhua English

WASHINGTON, June 1 (Xinhua) -- The public doubt on failure to raise the U.S. borrowing limit could have dire consequences for the U.S. economy and the global economy as a whole, the White House said on Wednesday.

Inaction to raise the nation's debt ceiling would be highly negative for the global markets, interest rates, the U.S. economic growth and job creation, White House Spokesman Jay Carney said at a daily briefing session.

The U.S. Treasury Department stressed on Wednesday that the nation has hit the 14.29 trillion U.S. dollars legal ceiling on borrowings and was starting to take extraordinary measures to buy some time until Aug. 2 for Democrats and Republicans to ink a deal and stave off a default on U.S. debt.

The House on Tuesday failed to pass a bill to raise the borrowing cap without making cuts in government spending, a showdown from House Republicans to press the administration to cut spending.

U.S. Treasury Secretary Timothy Geithner continued urging Congress to avoid the catastrophic economic and market consequences of a default crisis by raising the statutory debt limit "in a timely manner", Mary Miller, assistant secretary of the Treasury Department said in a statement on Wednesday.

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