Treasury Secretary Timothy Geithner is warning Congress that the U.S. is on the cusp of hitting the debt ceiling yet again, maybe as soon as Monday.
Geithner warned the Treasury Dept. will be taking some “extraordinary measures” to prevent borrowing from exceeding the previous debt ceiling limit, measures such as a temporary halt of the reinvestment of federal workers’ retirement account contributions.
This, along with other measures, might save the government $200 billion as the current level of federal debt hovers just under $95 billion below the $16.394 trillion debt ceiling limit.
A major problem with these “extraordinary measures” is that no one knows what effects the fiscal cliff may have on them. The biggest unknown is what effect new tax rules will have on the situation.
“If left unresolved, the expiring tax provisions and automatic spending cuts, as well as the attendant delays in filing of tax returns, would have the effect of adding some additional time to the duration of the extraordinary measures,” Geithner wrote.
This seems like even worse planning than we thought. The fiscal cliff is coming now, not next month. Or is this just a negotiating tactic? One might suspect a bit of both.
Whatever the true situation, we are right at the precipice. Will Obama lead us back from the edge?