Debt Ceiling Could Be Hit This Month

The government should hit the national debt's $7.4 trillion ceiling this month, and the Bush administration told Congress again Monday it should raise the limit. That would be a politically sticky move just weeks from the Nov. 2 elections.

Treasury Department spokesman Rob Nichols said the government is on track to reach the limit in early October. He could not provide a more specific date but said the forecast is made "on a day-to-day basis," and Congress would be notified.

The government can juggle accounts to stay under the limit through mid-November to avoid default, as it has in the past. But the Bush administration is urging Congress, which expects to adjourn Friday, to go ahead and raise the ceiling.

"We've been calling on Congress to act now for months, and we think it's important that they do so," Nichols said.

The government's debt was $7.364 trillion as of Friday, $18.3 billion from the ceiling. Congress last boosted the limit in May 2003.

SOURCE

 

Bush administration uses pension money to avoid debt ceiling

WASHINGTON, Oct 14 (AFP) - US President George W. Bush's administration said Thursday it will temporarily stop paying into a federal retirement fund to avoid hitting a 7.38-trillion-dollar debt ceiling.

US Treasury Secretary John Snow said he would suspend payments immediately to the federal employees' Government Securities Investment Fund (G-Fund) in order to keep the government running.

Source: Agence France Presse

 

U.S. Hits Debt Limit After Senators Put Off Raising Ceiling

The federal government reached its $7.4 trillion debt ceiling yesterday, forcing Treasury Secretary John W. Snow to delay contributing to one of the federal employees' pension systems to avoid running out of cash and possibly defaulting on government debt.

The situation will probably be temporary, as it has in the past. Congressional leaders said that when they return for a lame-duck session after the election, they will raise the debt ceiling to allow the government to borrow the money it needs to pay its bills. At that point, any overdue contributions to the pension fund would be paid, with interest.

Source: Washington Post

 

White House: Debt Ceiling Must Be Raised

The Bush administration announced Wednesday [November 3rd] that it will run out of maneuvering room to manage the government's massive borrowing needs in two weeks, putting more pressure on Congress to raise the debt ceiling when it convenes for a special post-election session.

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The government hit the current debt ceiling of $7.384 trillion on Oct. 14, forcing Treasury to begin a series of bookkeeping maneuvers to keep financing the government's normal operations without breaching the debt ceiling. But Treasury Secretary John Snow has warned that those special measures would last only until mid-November.

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Republicans have proposed that the debt ceiling be raised by $690 billion to $8.074 trillion, an amount that would get the government through next September, when the 2005 budget year ends.

Source: The Associated Press

 

We are in an era of government by credit card. The debt ceiling remained stable from 1997 to June 2002, when it was raised from $5.7 trillion to around $6.1 trillion; about a year later it was raised to $7.34 trillion. With the new target of $8.1 trillion, we will have seen a debt ceiling increase of about $2.5 trillion in barely two years. Every year we spend hundreds of billions of hard-earned tax dollars on the interest - the interest alone - on this debt.

This year's increase on the debt equals nearly the entire federal budget as recently as 1982.

And there's no relief in sight. The Congressional Budget Office estimated this week that current policy will produce $2.3 trillion more in deficit spending over the next decade. And that number doesn't include the cost of wars in Iraq and Afghanistan.

It's a good thing the conservatives are in charge of our spending and fiscal policies in Washington.

 

Senate OKs $800B Debt Limit Hike

A divided Senate approved an $800 billion increase in the federal debt limit Wednesday, a major boost in borrowing that Sen. John Kerry and other Democrats blamed on the fiscal policies of President Bush.

The mostly party line, 52-44 vote was expected to be followed by House passage Thursday. Enactment would raise the government's borrowing limit to $8.18 trillion - $2.23 trillion higher than when Bush became president in 2001, and more than eight times the debt President Reagan faced when he took office in 1981.

Souce: Associated Press

That means the government's borrowing limit is now $8,180,000,000,000.00. The interest expense on the National Debt is the third largest expense in the federal budget. Only Defense and income redistribution are higher. Just for the month of October the federal government has spent $13,735,391,456.62 of the taxpayers money just on the interest for the National Debt.

In FY03 the U. S. Government spent $318 Billion of your money on interest payments to the holders of the National Debt. In FY04 the amount was $322 Billion. Compare that to NASA at $15 Billion, Education at $61 Billion, and Department of Transportation at $56 Billion.

Source: National Debt Awareness Campaign