As of Thursday’s close, the amount of cash in the government’s account was just $38.837 billion, the lowest it has been since the current debt ceiling crisis began. To get a sense of how small that figure is, it is less than the net worth of 31 individuals in the US, even though the size of US economy is of the order of $27 trillion. Or if one wanted to look at it another way, it is also an indicator of the obscene wealth accumulation in the US that allows individuals to have more than the government has in its cash account.
Treasury secretary Janet Yellen warned some months ago that the government would run out of money sometime around June 1. Skeptics accused her of scaremongering and that the so-called X-date would be much later, maybe even in July or August. It is hard to estimate the exact date since revenues and expenditure vary on a day-by-day basis. But it is beginning to look like she was pretty accurate and yesterday she provided a much firmer date, and that it would be June 5th.
“Based on the most recent available data, we now estimate that Treasury will have insufficient resources to satisfy the government’s obligations if Congress has not raised or suspended the debt limit by June 5,” she wrote in a letter to House Speaker Kevin McCarthy.
Yellen’s new estimate contains more specificity than her earlier guidance. “By June 5,” she said in Friday’s letter, whereas her last two letters to Congress suggested a little more uncertainty — “as early as June 1” was the phrasing she used.
The exact timing of the so-called “X-date,” when the U.S. will not be able to pay its bills, has a degree of uncertainty, as the Treasury Department tracks money coming into and leaving its coffers.
“We will make more than $130 billion of scheduled payments in the first two days of June, including payments to veterans and Social Security and Medicare recipients. These payments will leave Treasury with an extremely low level of resources,” Yellen wrote.
She noted the Treasury Department is scheduled to make an estimated $92 billion in payments and transfers the week of June 5 and said the government would not have adequate resources to satisfy all of its obligations.
So here we are, on the brink again.
It is a crazy way to run the economy.
They could stop sending money to the military and republican states. But Biden does not know how to play rough.
Marcus Ranum @ # 1: They could stop sending money to the military …
Estimated date of national coup in that scenario: June 7.
Perhaps it’s seen as the cost of doing business, and perhaps it serves other purposes.
Crazy is as crazy does, and though this issue seems perennial, it has not yet happened that the USA ever had its default instantiate.
Don’t expect it to happen this time, either.
Marcus @1,
Interesting claim. So, you hold that not knowing how to play rough is not necessary in order to be a heavyweight politician for decades and then become President.
(Bullied into success, I suppose)
[bloody double negative 😐 ]
Correct. Just like being intelligent isn’t necessary.
Well, what do I know about the political landscape, its terrain and its climate and its weather and how to navigate them to some goal.
Some people think not being able to play rough matters not in that domain of endeavour.
I am not one of them.
>It is a crazy way to run the economy.
It has nothing to do with “run[ning] the economy”, and everything to do with the GOP using a historical artifact as a means of extortion to push through policy changes desired by their wealthy masters, changes that will transfer yet more billions upwards to the top percentiles.
>They could stop sending money to the military and republican states. But Biden does not know how to play rough.
Marcus demonstrates once again that he’s an intellectually dishonest ignoramus.
@ 7 Morales
You realise you could just have typed, “I disagree”? It would have been just as compelling and saved us three (more) comments of tedious waffle.
Silentbob, you do realise you could have posted about the topic at hand as I did, instead of indulging your evident need to obsess over me, no?