By Martin Crutsinger
WASHINGTON -- Treasury Secretary Henry Paulson told Congress on
Wednesday the government will hit the current debt ceiling on Oct.
1. He sought quick action to increase the limit, saying it was
essential to protect the "full faith and credit" of the country,
especially at a time of financial market turmoil.
The limit is $8.965 trillion. Unless Congress votes to raise it,
the country would be unable to borrow more money to keep the
government operating and to pay debt obligations coming due.
The United States has never defaulted on a debt payment but the
decision on whether to raise the debt ceiling often means a prolonged
battle in Congress.
Paulson wrote congressional leaders that according to data now
available, the Treasury expects to reach the ceiling on Oct. 1 --
the first day of the new budget year.
That projection does not take into account moves the government
often has to use, such as withdrawing investments from certain trust
funds to create room for extra borrowing until Congress finally
approves a debt increase.
This month, the Senate Finance Committee approved increasing the
limit on the debt to $9.82 trillion. That boost of $850 billion
would be the fifth since President Bush took office in 2001.
The House approved an increase in May. The full Senate has not acted
yet.
"The full faith and credit of the United States, to which we all
remain committed, is a national asset and a cornerstone of the
global financial system," Paulson wrote. "In light of current
developments in financial markets, which would be exacerbated by
uncertainty in the Treasuries market, I urge the Senate to pass the
legislation reported by the Finance Committee to increase the debt
limit as soon as possible."
The national debt is the total accumulation of annual budget deficits,
which must be financed with borrowed money....
WASHINGTON -- Treasury Secretary Henry Paulson told Congress on
Wednesday the government will hit the current debt ceiling on Oct.
1. He sought quick action to increase the limit, saying it was
essential to protect the "full faith and credit" of the country,
especially at a time of financial market turmoil.
The limit is $8.965 trillion. Unless Congress votes to raise it,
the country would be unable to borrow more money to keep the
government operating and to pay debt obligations coming due.
The United States has never defaulted on a debt payment but the
decision on whether to raise the debt ceiling often means a prolonged
battle in Congress.
Paulson wrote congressional leaders that according to data now
available, the Treasury expects to reach the ceiling on Oct. 1 --
the first day of the new budget year.
That projection does not take into account moves the government
often has to use, such as withdrawing investments from certain trust
funds to create room for extra borrowing until Congress finally
approves a debt increase.
This month, the Senate Finance Committee approved increasing the
limit on the debt to $9.82 trillion. That boost of $850 billion
would be the fifth since President Bush took office in 2001.
The House approved an increase in May. The full Senate has not acted
yet.
"The full faith and credit of the United States, to which we all
remain committed, is a national asset and a cornerstone of the
global financial system," Paulson wrote. "In light of current
developments in financial markets, which would be exacerbated by
uncertainty in the Treasuries market, I urge the Senate to pass the
legislation reported by the Finance Committee to increase the debt
limit as soon as possible."
The national debt is the total accumulation of annual budget deficits,
which must be financed with borrowed money....
No comments:
Post a Comment