So here’s a rough timeline for the whole debt-ceiling fiasco:
May 19: The United States hits the debt ceiling. That’s right, the U.S. government actually bumped up against its $16.699 trillion borrowing limit five months ago. Ever since, the Treasury Department has taken a slew of “extraordinary measures” — such as tapping exchange-rate funds — to raise an extra $303 billion without borrowing and to ensure the government has enough cash to meet its obligations, from paying bondholders to sending Social Security checks.
Oct. 17. Extraordinary measures end. Oct. 17 isn’t necessarily the doomsday date, as Republicans like Bob Corker and Susan Collins have pointed out. It’s just the date that the Treasury Department estimates that all those “extraordinary measures” will run out.
At that point, according to Treasury Secretary Jack Lew, the government will have only around $30 billion cash on hand to meet the country’s commitments, plus whatever tax money comes in.
This won’t necessarily lead to default right away. But it does put the Treasury Department in a precarious situation. “This amount would be far short of net expenditures on certain days, which can be as high as $60 billion,” Lew wrote in his letter to Congress.
Oct. 22 – Nov. 1: At some point here, the government likely won’t be able to pay all its bills.