Treasury secretary Jack Lew says that the U.S. debt limit will be reached on Nov. 3, two days earlier than it was supposed to, reports CNBC. This means that Congress will need to raise the debt ceiling for the government to meet its debt obligations.
Lew wrote a letter to Congress imploring them to do just that:
At that point, we expect Treasury would be left with less than $30 billion to meet all of the nation’s commitments—an amount far short of net expenditures on certain days, which can be as high as $60 billion.
Operating the United States government with no borrowing authority, and with only the cash on hand on a given day, would be profoundly irresponsible. As I wrote previously, we anticipate that a remaining cash balance of less than $30 billion would be depleted quickly.
For anyone who has paid attention to the news over the past five years, this is a serious case of deja vu all over again. The Republican-controlled Congress contemplated refusing to raise the debt ceiling in both 2011 and 2013, led by fiscal-hawk Tea Party conservatives. The 2011 crisis was so close to catastrophe that Standard and Poors downgraded the U.S. ‘s credit rating.
Given that the Republicans currently have a lame-duck speaker in John Boehner, who recently announced his plans to resign, it seems unlikely that such a game of brinksmanship will be played again, though one never knows.