The U.S. has begun using final extraordinary measures to avoid breaching the nation’s debt limit, Treasury Secretary Jacob J. Lew said.
Lew, in a letter addressed to House Speaker John Boehner dated today, repeated that the measures will be exhausted no later than Oct. 17 and urged Congress to extend the nation’s borrowing authority “immediately.”
“Once the final extraordinary measures are exhausted, no later than October 17, we will be left to meet our country’s commitments at that time with only approximately $30 billion,” Lew said in the letter. “This amount would be far short of net expenditures on certain days, which can be as high as $60 billion.”
Lew and President Barack Obama have said they won’t negotiate on the limit, which is tied to obligations the U.S. already has incurred.
Boehner, an Ohio Republican, has issued a list of demands before he’ll support raising the ceiling. His conditions include approval of TransCanada Corp.’s Keystone XL pipeline, major revisions to the tax code and a one-year delay of the insurance mandate in the Obama health-care law.
The U.S. government already is paralyzed after Republicans and Democrats in Congress failed to agree on funding for the new fiscal year that began today. That led to a partial shutdown of the government at midnight, forcing about 800,000 federal workers off the job. The shutdown could cost the economy as much as $10 billion a week, the White House said on its website.
The so-called extraordinary measures are accounting maneuvers allowing the Treasury to avoid breaching the $16.7 trillion debt ceiling. They include allowing the government to enter into a debt swap with the Federal Financing Bank and the Civil Service Retirement and Disability Fund.
© Copyright 2016 Bloomberg News. All rights reserved.