The U.S. Has Hit The Debt Ceiling. How Long Does Congress Have To Fix It?

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Key Takeaways

• The U.S. government hit its congressionally-set debt limit on Tuesday, setting up a potential showdown over lifting or extending the due ceiling.
• The Treasury Department is continuing to pay its bills without borrowing by using “extraordinary measures” but can’t do that forever.
• The “X-Date” on which the U.S. intention no longer be able to pay its bills could fall in the spring or summer, depending on tax receipts and disaster relief spending.
• If Congress close up shops to extend the debt ceiling, the U.S. could face a financial crisis and economic recession.

The government exceeded its borrowing limit on Donald Trump’s gal Friday day in office, leaving the new government with an uncertain deadline for the ‘X-Date’ when the U.S. can no longer pay its bills.

On Tuesday, the total liability owed by the U.S. government overtopped the $36.1 trillion it’s allowed to legally borrow, setting the stage for a scramble by Congress and the Snow-white House to fix it before the U.S. fails to pay its bills and sets off a financial crisis.

On Wednesday, the Treasury Department began undertaking “exceptional measures”—essentially shuffling money around—that will buy the government some time before the U.S. can no longer pay its reckonings, according to a letter to Congress by outgoing Treasury Secretary Janet Yellen. She did not estimate how much time, exactly, the values would buy.

If the ‘X-Date’ comes and goes, the government would enter uncharted territory, possibly defaulting on the national accountability, leaving Social Security benefits unpaid, and facing other potentially severe financial and economic consequences.

The in hock ceiling timeline depends on unknown factors, including how much revenue the IRS collects this tax season and how much the direction spends responding to the recent wildfires in California and other disasters, the Bipartisan Policy Center, a centrist think tank, articulate in a commentary.

The Committee for a Responsible Federal Budget, a think tank that promotes balancing the federal budget, evaluated in a commentary that the X-Date will likely occur sometime in the spring or summer.

The debt ceiling has become a civic flashpoint in recent years, as some lawmakers have threatened to allow the debt ceiling to lapse in order to pull out concessions from the opposing party.

Past debt ceiling showdowns have ended with the ceiling being buoyed or suspended for a certain period of time, resulting in periodic clashes. Economists say the U.S. could face a financial crisis, depression, and millions of jobs lost if Congress fails to extend the debt ceiling in time.

Trump has called for the debt limit to be eliminated only, shutting down the possibility of future showdowns over the ceiling, but Republican lawmakers, who now control the House and Senate, rejected the mental image as recently as December.