Next to a bus stop board showing U.S. national debt figures after the U.S. government hit the $31.4 trillion borrowing limit amid a confrontation between the Republican-controlled House of Representatives, President Joe Biden and Democratic lawmakers. A financial crisis that will occur within months on January 20, 2023 in Washington, USA as the car drives.
Amanda Andrade Rhodes | Reuters
WASHINGTON — Unless Congress raises the $31.4 trillion debt ceiling, the U.S. Treasury will run out of emergency measures to prevent debt defaults between July and September, the Congressional Budget Office predicted Wednesday. bottom.
Note that in the latest forecast, the final date will be determined by tax revenues received by the IRS in April. If those revenues drop significantly from his CBO estimates, “the temporary measures could run out sooner and the Treasury could run out of funds by his July,” said a CBO director. One Phillip Swagel said in a statement Wednesday.
The CBO also Size of Annual Federal Budget Deficit Over the next 10 years.Agency now believes deficit will add up $18.8 trillion Over the next 10 years, that number is 20% higher than the agency’s estimate last May. $15.7 trillion.
The US reached its current debt ceiling in January of this year. At that point, Treasury Secretary Janet Yellen initiated a series of established measures known as “special measures” that allowed the government to continue borrowing to meet its obligations.
If these measures are exhausted before President Joe Biden approves the new debt limits passed by Congress, “the government will either delay paying for some activities, fail to meet its debt obligations, or We’re going to have to do both,” Swagel said.
The CBO plans to release another estimate in May that takes into account 2022 tax revenue, Swagel said at a news conference Wednesday.
The Republican and Democratic heads of the Capitol have repeatedly assured the public that the United States will not default and that a deal will be reached and legislation passed in time to avoid a crisis.
But no one knows what that bill will look like or how it will win majorities in both the Republican-controlled House and the Democratic-controlled Senate.
A majority of Republicans in the House are demanding that Congress pass drastic cuts in federal spending before agreeing to vote to raise the debt ceiling, effectively using their influence within the Republican Party. , pushing their priorities to the forefront.
Republicans argue that the debt ceiling and annual federal spending go hand in hand, just as household debt is a product of household spending.
But Democrats say a large portion of every dollar government spends goes toward mandatory spending like Social Security payments and interest on Treasury bonds, and that federal spending can’t be cut like households can. I object.
The CBO’s estimates, released Wednesday, are likely to feature prominently in the next debate on federal spending.
The CBO said the major increase in the federal deficit over the next decade was due to the cost of bills passed by Congress last year, rising costs for Medicare, Social Security and Veterans Benefits, and future interest rates on increased national debt. We believe it is due to several factors such as payment.
Meanwhile, the agency projected its tax revenue don’t keep pace at these rising costs.and a certain amount of tax revenue expected to fall Like those from the gas tax as more Americans drive electric cars.
