By Terence P. Jeffrey
October 16, 2013 - 5:28 PM
Treasury Secretary Jacob Lew (AP Photo/Susan Walsh)
(CNSNews.com) - Every business day since May 17, the U.S. Treasury
has published a daily statement claiming that the federal debt subject
to the limit set by Congress closed the day at
$16,699,396,000,000—about $25 million below the legal limit.Monday, the Columbus Day holiday, according to the Daily Treasury Statement released today, marked the 150th straight day that the Treasury has said the debt subject to limit was stuck at $16,699,396,000,000.
On May 17, the first day the debt closed the day at $16,699,396,000,000, Treasury Secretary Jacob Lew sent a letter to House Speaker John Boehner stating that since the Treasury was about to hit the debt limit he would begin to use “extraordinary measures” to prevent it from doing so. These included, among other things, suspending investment of the Civil Service Retirement and Disability Fund in U.S. Treasury securities, and redeeming securities already held by this fund.
“In total, the extraordinary measures currently available free up approximately $260 billion in headroom under the limit,” Lew wrote then.
But in that letter, Lew described the unpredictability of the Treasury’s flow of funds to explain why he could not predict exactly when the extraordinary measures would be exhausted.
“The effective duration of the extraordinary measures is subject to considerable uncertainty due to a variety of factors, including the unpredictability of tax receipts, changes in expenditure flows under the sequester, and the normal challenges of forecasting the payments and receipts of the U.S. government months into the future,” wrote Lew.
“Given the uncertainty described above, at this time, Treasury is not able to provide a specific estimate of how long the extraordinary measures will last,” wrote Lew.
“However, in view of the forthcoming Fannie Mae payment and the trend in other payment flows, it is now clear that the measures will not be exhausted until after Labor Day,” he wrote.
On Aug. 26, Lew wrote Boehner again. “Based on our latest estimates, extraordinary measures are projected to be exhausted in the middle of October,” he said. “At that point, the United States will have reached the limit of its borrowing authority, and the Treasury would be left to fund the government with only the cash we have on hand on any given day.”
On Sept. 25, Lew wrote Boehner again. “Treasury now estimates that extraordinary measures will be exhausted no later than October 17,” he said. “We estimate that, at that point, Treasury would have only approximately $30 billion to meet our country’s commitments.”
On Oct. 1, Lew wrote Boehner again, restating his estimation that the “extraordinary measures” preventing the debt from breeching the limit would be exhausted “no later than October 17.”
When Lew wrote each of these letters, as well as at the close of business yesterday, his Treasury reported that the debt subject to limit had closed the day at $16,699,396,000,000.
