....on the debt ceiling here
In it, he quotes Ed Yardeni about the prospect that the Treasury would stop making interest payments on debt if the ceiling were not raised:
"Over the past 12 months through April, net interest expense of the federal government was $213.1 billion. Will there be no money to make these payments if the debt ceiling isn’t raised? There will be plenty. Over the past 12 months through April, the Treasury collected $2.27 trillion in revenues. In April alone, when individual tax returns are due, revenues totaled $289.5 billion, a bigger than expected gain, confirming that the economy recovered smartly over the past year.
It would be criminally insane for the Treasury to stop making interest payments on our debt just because Congress failed to agree on raising the ceiling when the revenues are certainly available to make the payments and auctions will continue to rollover maturing debt. It is insane for administration officials to suggest otherwise" [end quote]
Obviously the Treasury could prioritze interest payments, but choose not to prioritize other spending that the Congress had appropriated. That may be the only way we will actually see spending cuts in the near term if Congress cannot come to a conclusion
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