by Mitch Kokai
Senior Political Analyst, John Locke Foundation
Congress is already pushing the boundaries of how long it can go without raising the debt ceiling.
Treasury Secretary Jack Lew has told Congress that lawmakers have only until Nov. 3, less than two weeks, to raise the federal debt ceiling before he runs out of options for managing the debt.
Outside analysis suggests that if the limit isn’t raised by then, the government risks missing a payment on the debt or another of its obligations by mid-November.
More immediately, the Treasury likely will face increasing borrowing costs over the next few days as concerns about the possibility of a default creep into markets for Treasury bonds.
Here is a timeline of the relevant events:
Over the next two weeks
1. Rising borrowing costs
Over the next two weeks, interest rates on short-term Treasury securities are likely to rise. …
… 2. The Treasury uses up all its options
The Treasury has been up against the $18.1 trillion debt ceiling since March.
It has managed to pay the bills since then without issuing more debt by essentially shifting funds around in government accounts. …
… 3. On Nov. 3, Lew has informed congressional leaders, he will have used up all the resources he has to create space under the debt ceiling and will have no more ability to issue new debt.