6/5/2023 0 Comments One for the money book seriesThe president will meet with congressional leaders on Tuesday to try to find some common ground. But the threat of default is now looming large – as soon as June 1 – while President Joe Biden and House Republicans remain far apart on a solution to the impasse. Treasury has never been forced to implement any contingency plans because lawmakers always addressed the borrowing cap in time. Among the highest priorities would be paying interest and principal on Treasury securities, according to a transcript of a Federal Reserve’s Federal Open Market Committee call during the 2011 debt ceiling crisis. One option that Treasury officials have seriously contemplated in past debt ceiling dramas is prioritizing payments, which would entail satisfying certain bills before others. As the date that the US could default on its obligations grows closer, the Treasury Department must prepare for an unprecedented situation – figuring out which bills to pay with the money it has on hand if Congress doesn’t act.
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