Debt ceiling suspension bill heads to the White House
The House and Senate have approved a bill to ignore enforcement of the debt ceiling through May 18 and President Obama is expected to sign the legislation.
In a 64-34 vote on Jan. 31, the Senate approved H.R. 325, which allows the government to borrow more than its current $16.4 trillion limit by disregarding the limit instead of raising it. The bill passed a Jan. 23 House vote 285 to 144. Without the bill, Treasury says the government would default on its obligations as early as the end of February.
In a Friday press briefing, White House Press Secretary Jay Carney said he is sure that the president will sign the bill but does not know the exact date.
On May 19, the debt ceiling will be set at the amount that has been borrowed through the day before and the Treasury Department will again undertake extraordinary measures to extend the government's ability to pay its bills.
The Bipartisan Policy Center says the next round of extraordinary measures will work for longer than their last iteration because "significant additional extraordinary measures become available on June 30 that will allow Treasury to raise additional cash to meet its obligations." These include the options to suspend semiannual payments and reinvestment of maturing securities in some retirement benefit funds.
In total, the BPC expects the debt limit will be increased by roughly $450 billion once it is reinstated on May 19. It warns, however, that the longer it takes for the president to sign the bill the less effective these extraordinary measures will be for extending funds after May 19.
Carney said the next focus is on sequestration and ways to reach those spending-cut levels before it is enacted. "The entire sequester is bad policy. It was designed to be bad policy," he said.