Here’s What Happens If Debt Limit Not Raised

If the debt limit isn’t raised by October 17, we go into default and stop paying bills. For example:

October 17: The Treasury’s cash-on-hand drops to $30 billion, compared to daily payment needs that sometimes rise to $60 billion.

It continues to receive tax and other revenue, so it can continue to pay most of its obligations, but revenue varies from day to day, making it difficult to pin down when exactly it will run out of cash.

Analysts believe the Treasury is unlikely to miss any payments on Thursday, but from that day the risk mounts.

October 22: The independent Congressional Budget Office and the BPC both say this is the first day the government might be unable to pay all of its bills, though no major payments are due on this date.

October 23: The government must issue checks for $12 billion in social security benefits, according to the BPC.

October 24: The Treasury needs to roll over around $93 billion in debt. Although this won’t have any immediate extra costs, the long-term cost could be higher if the ceiling has not been increased.

October 31: The Treasury has to pay out $6 billion in interest on government debt, as well as roll over $115 billion in bonds.

November 1: The government has to pay out over $55 billion in Medicare payments, social security benefits; and pay and benefits for members and retirees from the military.

By: Alan

Alan Colmes is the publisher of Liberaland.