Federal Reserve Chairman Ben Bernanke on Monday urged U.S. lawmakers to raise the country's debt ceiling to avoid a potentially disastrous default on its debt.
Likening Congress to a family arguing that it can improve its credit rating by deciding not to pay its credit card bill, Bernanke said that raising the legal borrowing limit was not the same as authorizing new government spending.
It is "very, very important that Congress take necessary action to raise the debt ceiling," he told an event sponsored by the University of Michigan.
In a letter to Congress, Treasury Secretary Timothy Geithner also urged lawmakers to raise the $16.4 trillion legal limit on the nation's debt, or risk 'irreparable' economic harm.
The United States should run out of tools to avoid a default between mid-February and early March, which could lead to lasting damage to the U.S. economy and its creditworthiness, Geithner said.
He said the Treasury would later provide a more narrow timeline for when it believes it will no longer be able to pay the government's bills.
© 2013 Thomson/Reuters. All rights reserved.