Trump Agrees With Elizabeth Warren On Eliminating Debt Ceiling As August Deadline Approaches

U.S. President Donald Trump expressed a rare agreement with Senator Elizabeth Warren on Wednesday, advocating for scrapping the U.S. debt limit amid renewed debate in Washington over the risks and politics of the federal debt ceiling. 

“I am very pleased to announce that, after all of these years, I agree with Senator Elizabeth Warren on SOMETHING. The Debt Limit should be entirely scrapped to prevent an Economic catastrophe,” he wrote in a post on Truth Social Wednesday afternoon.

The U.S. debt limit is a statutory cap on the total amount of money the federal government can borrow to meet its existing legal obligations. Periodic standoffs over raising or suspending this limit have led to repeated threats of government default, which experts warn could trigger severe economic consequences.

The most recent suspension of the debt ceiling, enacted in 2023, expired in early 2025, reinstating the cap at over $36 trillion and forcing the Treasury to use "extraordinary measures" to avoid default.

Trump and Warren both argue that the debt ceiling is too dangerous to leave as a political bargaining chip, as delays and confrontations over its increase can threaten economic stability.

“It is too devastating to be put in the hands of political people that may want to use it despite the horrendous effect it could have on our Country and, indirectly, even the World,” Trump wrote in his Truth Social post.

While Trump also referenced Warren’s separate suggestion of a $4 trillion increase in the debt ceiling, he indicated support for doing so "over a period of time, as short as possible."

Warren, however, has criticized the idea of raising the debt ceiling specifically to fund further tax cuts for the wealthy, calling such proposals "unacceptable" and an "outrage." She maintains that eliminating the debt ceiling should not be used to facilitate additional tax breaks for billionaires.

The issue has become urgent as the Treasury warns that, without congressional action, the U.S. could default as early as August 2025, coinciding with the start of Congress's summer recess.

Trump’s support for scrapping the debt limit is also linked to his push for a major fiscal package, which includes a four-year extension of the debt ceiling and significant new deficit spending, a proposal facing resistance in the Senate.

Markets rose slightly on Wednesday, but gains were kept in check after private sector hiring hit its lowest level in more than two years. 

The SPDR S&P 500 ETF Trust (SPY) was up 0.22%, the Invesco QQQ Trust (QQQ), which tracks the Nasdaq 100, gained 0.35%, and the SPDR Dow Jones Industrial Average ETF (DIA) rose 0.07%.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read also: Elon Musk Attacks Trump’s Spending Bill, Yet Again – Warns of Interest-Only Government