Debt ceiling drop-dead date remains Aug. 2, Treasury says
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The Treasury Department reiterated Wednesday that Aug. 2 remains the projected day the nation’s debt ceiling would be breached, attempting to set in stone a drop-dead deadline as the Obama administration and congressional Republicans continue to haggle over raising the limit.
“On the basis of careful analysis of actual and projected revenues and expenditures, the Treasury Department continues to project that the United States will exhaust its borrowing authority under the debt limit on Aug. 2, 2011,’ said Mary Miller, Treasury’s assistant secretary for financial markets.
The U.S. reached its $14.3-trillion debt ceiling on May 16, but Treasury officials have been doing some complex financial juggling to push off the date at which the nation would start defaulting on its obligations. Treasury Secretary Timothy F. Geithner has said those ‘extraordinary measures’ could only postpone the fiscal reckoning for several weeks.
‘Secretary Geithner continues to urge Congress to avoid the catastrophic economic and market consequences of a default crisis by raising the statutory debt limit in a timely manner,” Miller said.
Her statement came as President Obama met at the White House on Wednesday morning with all the House Republicans. The debt ceiling was certain to be a major topic, particularly after the Republican-controlled House on Tuesday rejected a $2.4-trillion increase in the debt ceiling.
The measure did not include any spending cuts, which Republicans and some Democrats have insisted on. Instead, the vote was designed by House GOP leaders to send a strong message to the White House that it must compromise more on deficit reduction if it wants a debt-ceiling increase.
The date at which the U.S. would start defaulting on its obligations has been a bit of a moving target throughout this year. In January, Geithner warned congressional leaders that the debt ceiling technically could be reached as early as March 31, with the fiscal maneuvering delaying the ‘unthinkable’ consequences for ‘several weeks.’
Larger-than-anticipated tax revenues pushed that technical date to May 16, Geithner announced in April, when he first set a potential drop-date for the expiration of the ‘extraordinary measures’ as July 8.
Last month, Geithner pushed the drop-dead to Aug. 2.
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-- Jim Puzzanghera
