Actually, we’re running beyond empty now. The United States can’t legally borrow any more money until Congress acts to raise the debt ceiling.
Treasury Secretary Timothy Geithner informed Congress on Monday that the United States has reached its legal debt limit, setting off a ticking time bomb that could explode in less than three months if lawmakers can’t bridge differences and allow more government borrowing.
In hitting the $14.3 trillion debt ceiling – the limit on how much the government can borrow – the Obama administration on Monday began temporarily halting payments to the retirement and federal pension accounts of federal workers and started borrowing from those funds, to be restored later.
Geithner sent a letter to Senate Majority Leader Harry Reid, D-Nev., warning that the government can move money around for about 11 weeks but if a new debt ceiling isn’t agreed to by Aug. 2, the U.S. government could effectively default on its obligations to its creditors. He warned of “catastrophic economic consequences for citizens” unless Congress raises the debt ceiling.
An increase of about $2 trillion is expected, enough to get the issue past the 2012 elections before Congress would have to lift it again.
Republicans who control the House of Representatives vow to link raising the debt ceiling to cuts in government spending of at least equal measure. In a combative statement Monday, House Speaker John Boehner, R-Ohio, upped the ante.
“As I have said numerous times, there will be no debt limit increase without serious budget reforms and significant spending cuts, cuts that are greater than any increase in the debt limit.” Boehner has called previously for $2 trillion in spending cuts as part of any deal to raise the debt ceiling.
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Well, we hit the debt ceiling and, despite all the Democrat Chicken Little hysteria, the Sun didn’t explode, the seas didn’t boil, and the markets didn’t plunge thousands of points. Go figure.
/all I can say is that the Republicans had better stand firm and hold their ground this time and hold out for concrete, verifiable spending cuts that at least equal the amount of any debt limit increase
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