Disrupted pay for service members, late benefits checks for veterans and a hit to U.S. national security are only a glimpse into what could come.
Defense Secretary Lloyd Austin made that much clear this past week, telling lawmakers that the Pentagon “won’t, in some cases, be able to pay our troops with any degree of predictability,” should a default come to pass.
And Joint Chiefs of Staff Chair Gen. Mark Milley said such an event could also “embolden China and increase risk to the United States.”
The debt limit is the dollar figure up to which the Treasury Department can borrow to pay for congressionally approved spending decided through the annual appropriations process.
The Biden administration and the GOP are at a standstill on the matter, with congressional Republicans demanding cuts in exchange for lifting the ceiling. The White House, however, has stood firm that the limit should be raised now, and spending cut negotiations will be handled separately.
With the deadline approaching in a manner of weeks, the brinkmanship between the White House and congressional leaders to avoid a default so far has not made progress.
The Treasury Department has warned the country could default, an unprecedented event in modern times, as soon as June 1.
And the Congressional Budget Office (CBO) issued a report Friday that estimated the federal government’s deadline could now be the “first two weeks of June.”
Because the Treasury has never been incapable of paying U.S. debt obligations — the one exception being in the War of 1812 when parts of Washington were burned, including the Treasury building — it’s not exactly clear what the effect would be on government payments.
As the matter depends on how the Treasury Department decides to prioritize U.S. bills, it’s to be seen what takes precedence. Ongoing obligations that deal with national security, however, require a big chunk of that change.
Read the full report at digital-staging.thehill.com.
