Officials with the Treasury Department on Wednesday said they will employ bookkeeping maneuvers to avoid an unprecedented default on the $28 trillion national debt this summer. But they say those measures could be exhausted “much more quickly” than normal, given the circumstances of the pandemic, unless Congress takes action.
What’s the reason for the warning? The government has been able to borrow enormous sums of money to finance trillions of dollars of spending during the pandemic because Congress suspended the limit on borrowing.
After July 31, the limit will return to whatever debt level exists at that time. Treasury officials urged Congress to pass either a new borrowing cap or another suspension of the debt limit.