by Gary North
The U.S. government’s debt has been locked in at this implausible limit for three months: $16,699,396,000,000.
The Secretary of the Treasury says that it will not hit the ceiling until mid-October. The BBC reports this.
The country’s borrowing limit is currently capped at $16.7tn (£10.7tn).”Extraordinary measures are projected to be exhausted in the middle of October,” Mr Lew said in a letter to House Speaker John Boehner and other lawmakers.
“At that point, the US will have reached the limit of its borrowing authority, and Treasury would be left to fund the government with only the cash we have on hand on any given day,” he said.
The cash balance at that time is forecast to be about $50bn, which Mr Lew said, would be “insufficient to cover net expenditures for an extended period”.
He said: “Operating the government with no borrowing authority, and with only the cash on had on a given day, would place the United States in an unacceptable position.”
This warning is silly. The U.S. government has obviously been over the limit ever since late May. The world knows this.
On August 14, the Cybercast News Service (CNS) ran this story.
(CNSNews.com) – The Treasury Department’s Financial Management Service (FMS), which publishes both the federal government’s official Daily Treasury Statement and its official Monthly Treasury Statement, is reporting that in July the federal government ran a deficit of $98 billion but that the federal government’s debt remained exactly $16,699,396,000,000 for the entire month.The FMS said that the deficit went up $98 billion ($97,594,000,000) in the Monthly Treasury Statment for July, which it released on Monday.
At the same time, the FMS said the debt stayed at exactly $16,699,396,000,000 in its Daily Treasury Statements, which are published every business day. The Daily Treasury Statements show the daily value of the federal government debt that is subject to a legal limit set by Congress.
At the static $16,699,396,000,000 level that the Treasury reported for every day of July, the debt was just $25 million below the legal limit of $16,699,421,000,000 that was set in a law passed by Congress and signed by President Barack Obama.
If Treasury’s daily statements were to declare that the government had borrowed an additional net $98 billion to cover the $98 billion deficit the Treasury declared in its monthly statement for July, the Treasury would be conceding that the government had already surpassed the legal limit on the debt–and has been violating the law by continuing to borrowing additional money. MORE