Congressional Budget Office Director Phillip Swagel revealed on Wednesday that the federal government could “run out of funds” between July and September.
The federal debt ceiling, an arbitrary cap on the national debt established by Congress, exceeded the statutory limit of nearly $31.4 trillion last month, prompting Treasury Secretary Janet Yellen to launch “extraordinary measures” intended to continue funding the government through the month of June.
Swagel, whose agency is tasked with providing analyses of budget and economic information to Congress, said in a statement that lawmakers should address the debt limit before the government defaults on obligations.
“We project that, if the debt limit remains unchanged, the government’s ability to borrow using extraordinary measures will be exhausted between July and September,” he said. “The projected exhaustion date is uncertain because the timing and amount of revenue collections and outlays over the intervening months could differ from our projections. In particular, income tax receipts in April could be more or less than we estimate.”
President Joe Biden and House Speaker Kevin McCarthy are presently engaged in negotiations to lower federal spending ahead of any changes to the debt ceiling. Republican lawmakers struck a deal with McCarthy under which the party’s new majority will introduce a budget that must refrain from increasing the debt limit in the name of fiscal responsibility. Read more…