The Oklahoman

Debt limit could be hit in October, center says

- Martin Crutsinger

WASHINGTON – The U.S. government will likely face an unpreceden­ted default on its debt obligation­s between mid-October and mid-November, a Washington think tank said Friday, seconding a warning earlier this week from the Treasury.

The “X Date,” the date when Treasury Secretary Janet Yellen will run out of maneuverin­g room to avoid hitting the debt limit if Congress does not act, will occur a couple of weeks after the start of the new budget year on Oct. 1 and may not be reached until as late as the middle of November, according to the Bipartisan Policy Center.

“Given the current pace of federal spending and revenues, we are reasonably confident that the X Date won’t arrive before the start of the fiscal year or even the week or so following,” said Shai Akabas, director of economic policy for the center.

“But this train could go off the rails shortly thereafter.”

Yellen sent a letter this week to the leaders of Congress, saying that if the government does not act, the U.S. will be unable to avert a default in October.

Yellen has been employing what are deemed in law “extraordin­ary measures” to keep the government functionin­g and from hitting the debt limit, which went back to effect on Aug. 1 after being suspended for two years.

The current limit stands at $28.4 trillion and Yellen has been using book-keeping maneuvers to disinvest various government trust funds.

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