As part of the agreement to reopen the government, Congress passed the “Default Prevention Act,” which empowers the president to suspend the debt limit until February 8, 2014. To do so, the president must send a written certification to Congress that the Treasury will be unable to issue debt meeting commitments absent a suspension of the debt limit. Absent Congress disapproving this certification, on February 8, the debt limit would be reinstated at a new, higher level.
BPC estimates that the new debt limit on February 8 would be about $17.3 trillion, roughly $600 billion higher than the previous limit. At that point, Treasury would be able to use extraordinary measures to continue to meet federal government financial obligations, although those measures would not last as long as they did in this most recent Debt Issuance Suspension Period, which covered nearly five months.
November 21: Thoughts on CBO's New Debt Limit Report
November 21: Debt Limit Suspension: Frequently Asked Questions
October 18: BPC Estimates Agreement Will Increase Debt Limit by Roughly $600 billion; Debt Limit Suspended Until February 8, 2014
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In the News
Treasury Puts a Date on When Cash May Run Out: Oct. 17
The New York Times
U.S. Running Out of Cash More Quickly
The Wall Street Journal
Debt-ceiling doomsday comes Oct. 17. Here’s what happens next.
The Washington Post
Debt Limit: Market Reaction
As we approach BPC’s projected debt limit X Date range without a resolution, risks to markets, the economy, the federal government, and American citizens will grow. In these posts, we will attempt to report on these risks and their impacts as they occur. View all posts
September 25: Debt Limit Update: No Change to BPC X Date Projection
September 10: BPC’s Debt Limit Projection: Key Takeaways
January 30: When Will the Next Debt Limit X Date Be?
- What Is a Government Default on its Debt?
- Platinum Coins and IOUs: Missing the Point
- Debt Limit Analysis Update
- BPC’s Debt Limit Projection: Key Takeaways
- Will the Delay in the Tax Filing Season Affect the X Date?