Yellen: U.S. would be "permanently weaker" if debt limit not raised

Treasury Secretary Janet Yellen warned in a Wall Street Journal op-ed on Sunday that the U.S. could face a fresh financial crisis if Congress failed to raise or suspend the country's debt ceiling.

Why it matters: The U.S. has never defaulted on its debt, but some Republican lawmakers have threatened to vote against raising the debt ceiling, arguing that it would only promote more government spending.

• Yellen writes in the WSJ that failing to act "would likely precipitate a historic financial crisis that would compound the damage of the continuing public health emergency."

Of note: Yellen has previously said the U.S. could default in October if there's an impasse and has urged Congress to pass a bipartisan resolution. Now she warns the looming crisis could leave the U.S. a "permanently weaker nation."

• "[T]he overwhelming consensus among economists and Treasury officials of both parties is that failing to raise the debt limit would produce widespread economic catastrophe," Yellen wrote in the WSJ article.