The Fiscal Cliff isn’t the only budgetary hazard to be concerned about in 2013. Treasury Secretary Tim Geithner says the Federal Government has reached its 16.4 trillion-dollar borrowing limit.
That means the debt ceiling has to be raised by the end of February or early March, and only by using what Secretary Geithner calls “extraordinary measures” to free up an additional $200 billion. And even that amount will only help cover the federal government’s bills for a few months.
Will more debt hurt already fragile economic growth?Why didn’t the Fiscal Cliff deal resolve this issue? Why does the U.S. Government need to borrow trillions of dollars simply to pay its bills? And why is the actual deadline so nebulous?
Curtis Dubay, Senior Policy Analyst, Tax Policy at Heritage Foundation.
Michael Ettlinger, Economist & Vice President, Economic Policy at Center For American Progress