The United States could face a catastrophic default on its financial obligations as early as August if Congress fails to raise or suspend the debt ceiling, US Treasury Secretary Scott Bessent warned in a letter to lawmakers on May 9. As the nation’s debt continues to balloon past its statutory limit, political gridlock in Washington threatens to push the country into dangerous fiscal territory with global ramifications.

In a stark message addressed to House Speaker Mike Johnson, Bessent urged Congress to act decisively and finalize a deal by mid-July, before lawmakers adjourn for their scheduled summer recess. Failing to act, he warned, could unleash widespread disruption across financial markets, destabilize consumer and business confidence, and harm the United States’ standing as a global economic leader.

“The full faith and credit of the United States must never be in question,” Bessent wrote. “A failure to suspend or increase the debt limit would wreak havoc on our financial system and diminish America’s security and global leadership position.”

The US officially hit its current debt ceiling of $36.1 trillion in January. Since then, the Treasury Department has employed so-called “extraordinary measures” to buy time-accounting maneuvers like temporarily suspending investments into government pension funds and redeeming existing investments-to keep paying the government’s bills without incurring new debt.

These stopgap tactics have been effective at delaying a default, but they are running out of runway. The Treasury has already warned that its emergency measures will........

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