janet yellen debt ceiling
Watch Yellen warn Congress: This could have 'catastrophic economic consequences'
00:56 - Source: CNN Business
CNN  — 

House Speaker Nancy Pelosi insisted Wednesday that Congress would raise the debt ceiling, though she added it would not be done through reconciliation.

“We won’t be putting it in reconciliation, no,” Pelosi said during a news conference on Capitol Hill, when asked which options Democrats were pursuing to raise the debt ceiling.

Treasury Secretary Janet Yellen sent a letter to the Speaker earlier Wednesday morning emphasizing that Congress only had until mid-October to act before the federal government runs out of cash and extraordinary measures.

“When President Trump was President, we Democrats supported lifting the debt ceiling because it’s the responsible thing to do,” Pelosi noted. “I would hope that the Republicans would act in a similarly responsible way.”

Reconciliation would allow the debt limit to be extended without the support of Republican votes as Democrats only control 50 votes in the Senate, and would need at least 10 GOP votes to break a filibuster for legislation that isn’t passed through reconciliation.

But Republicans in the House and Senate, including Minority Leader Mitch McConnell, have said that they wouldn’t support raising the debt ceiling.

“​​They won’t get our help with the debt limit increase that these reckless plans will require,” he said in August, referring to the reconciliation package.

In her letter to Congress, Yellen said history shows that waiting “until the last minute” to suspend or increase the debt limit “can cause serious harm” to business and consumer confidence, raise borrowing costs for taxpayers and hurt America’s credit rating.

“A delay that calls into question the federal government’s ability to meet all its obligations would likely cause irreparable damage to the U.S. economy and global financial markets,” Yellen wrote.

Yellen’s comments were similar to those from many leaders in the business community that have warned not to allow the debt limit to be reached.

“It would be financial Armageddon,” Mark Zandi, chief economist at Moody’s Analytics, told CNN. “It’s complete craziness to even contemplate the idea of not paying our debt on time.”

CNN’s Matt Egan contributed to this report.