- Larry Downing/Reuters
US Treasury Secretary Jack Lew, in a letter to congressional leaders Thursday, said the nation’s debt ceiling would need to be raised by November 5, earlier than was anticipated.
Lew said the earlier-than-anticipated new “X date” estimate was due, in part, to lower-than-expected tax receipts.
“Based on this new information, we now estimate that Treasury is likely to exhaust its extraordinary measures on or about Thursday, November 5. At that point, we would be left to fund the government with only the cash we have on hand, which we currently forecast to be below $30 billion,” Lew wrote in the letter.
He added: “This amount would be far short of net expenditures on certain days, which can be as high as $60 billion. Moreover, given certain payments that are due in early to mid-November, we anticipate that our remaining cash would be depleted quickly. Without sufficient cash, it would be impossible for the United States of America to meet all of its obligations for the first time in our history.”
The new deadline is one week after US House Speaker John Boehner (R-Ohio) is set to leave Congress, so it will either be one of the last items tackled by Boehner or the first on the docket for his likely successor, current House Majority Leader Kevin McCarthy (R-California).
“The Treasury secretary’s letter is a stark warning of the stakes of Republicans’ Calendar of Chaos,” House Minority Leader Nancy Pelosi (D-California) said in a statement. “Failure to protect the full faith and credit of the United States would have a devastating impact on hard-working families across the country – including tumbling retirement savings and rising interest rates for student loans, mortgages, credit cards, and car payments.”
Lew previously told Congress in July that he couldn’t estimate with certainty the date at which it would need to lift the borrowing limit, but said it would likely need to do so sometime in the fall.
The issue has become a recurring fight on Capitol Hill, during which Republicans consistently demand concessions from the White House and Democrats in exchange for the borrowing cap. Boehner, while pushing that limit to the brink several times, stayed true to public statements and never allowed a debt-ceiling breach.
When asked earlier this week if he would move to address the debt ceiling before his departure, he didn’t rule it out.
The new deadline also comes about a week after funding for the Highway Trust Fund is set to expire October 29. Congressional negotiators are looking to get a long-term highway bill passed by the end of the month.
The full letter – sent to Boehner, Pelosi, US Senate Majority Leader Mitch McConnell (R-Kentucky), and Senate Minority Leader Harry Reid (D-Nevada) – is below.