Barack Obama has trotted out Treasury Secretary Timothy Geithner to claim that if the GOP refuses to raise the debt ceiling, the results will be catastrophic and that he has been using “extraordinary measures" to keep the U.S. economy afloat:
Treasury currently expects to exhaust these extraordinary measures between mid-February and early March of this year... If Congress does not act to extend borrowing authority, all of these payments would be at risk. This would impose severe economic hardship on millions of individuals and businesses across the country. It should also be noted that default would increase our borrowing costs and damage economic growth and therefore add to future budget deficits, not decrease them.
Of course, the idea that the federal government doesn’t have enough to pay off its bill without raising the debt ceiling has been debunked, but that isn’t stopping Geithner and Obama from demagoguing the issue.