United States Hits Debt Ceiling, Credit Limit in Question

The debt ceiling as recently put in action last Saturday. As the United States federal government hits an all-time high with its national spending, Congress must author a new bill to help raise the debt ceiling once more. As the country hit the roof, the national debt falls just over $22 trillion.

The Current U.S. Situation

President Trump and the United States Congress agreed to temporarily suspend the debt ceiling last February 2018. However, come the 2nd day of March, the credit limit was put back into effect, thus limiting the federal government’s capacity to borrow more money. The initial plan to raise the ceiling was still a few months away, reports Business Insider.

Role of the Treasury Department

While the government is banned from further incurring balances until the credit limit has been raised or suspended by the Congress, the Treasury Department can use its special powers to provide extraordinary measures. Such drastic measures can include momentarily stopping contributions for federal employee’s retirement funds and use the contributions towards paying the debts incurred by the country, as reported by The Washington Post.

According to CNN, the Treasury is expected to run out of money by the end of September, causing the federal government’s inability to pay bills and fulfill other relevant obligations. However, the Trump administration has yet to issue its formal estimate regarding the issue.

The administration is still in the works of negotiating strategies and securing funding, hoping that negotiations will turn out fruitful.