CNN recently reported that Oct. 18 could be the date the U.S. bangs its head against the debt ceiling.
A new study by the Bipartisan Policy Center listed the date as the earliest that the government’s cash supply could run out somewhere between Oct. 18 and Nov. 5.
That timeframe fits with a letter Treasury Secretary Jacob Lew sent to Congress earlier this month asking that the ceiling be raised as soon as possible. Lew hesitated to provide specific dates for the funds to run out, only saying the cap would be reached sometime in mid-October. And what would happen on that date? According to BPC, the Department of Treasury could find itself about $106 billion short of paying its bill once the limit is reached. About 32 percent of the government’s bills owed during that time period would go unpaid unless Congress reaches a deal to raise the debt ceiling. Those payments would include about $12 billion in Social Security benefits on Oct. 23, $6 billion in interest payments on Oct. 31, and $55 billion in Medicare, Social Security, military and veterans benefits on Nov. 1.
The U.S. reached its debt limit May 19. The Treasury adopted what it described as “extraordinary measures,” to keep the government liquid and maintain borrowing capacity. Those measures will be exhausted in the October-November time frame. The U.S. makes about 80 million payments a month.
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