The U.S. Treasury Department has begun taking steps to prevent a national debt default as Congress moves toward a clash between Democrats and Republicans over raising the borrowing limit.

Such emergency measures could help reduce outstanding debt under the cap, currently set at $31.4 trillion, but the Treasury warned that these tools would only help for a limited time -- probably no more than six months, AFP reported.

A default would undermine U.S. credibility, with JPMorgan Chase CEO Jamie Dimon warning that we should never question the creditworthiness of the United States government.

The world's largest economy could face serious upheaval as Republicans threaten to abandon the usual annual increase in the legal borrowing limit, a move that could push the United States into default.

Extreme right-wing Republicans want Democratic President Joe Biden to agree to cut government spending. They argue that drastic cuts are needed to reduce borrowing, which Congress usually agrees to increase each year by raising the so-called debt ceiling.

But the White House has said that such cuts must be tied to key Social Security and military spending programs or tied to major new taxes.

The White House also promised that Biden would not negotiate with uncompromising Republicans because of their "risky and dangerous" opposition to increasing the cap.