21 Days: Treasury Says Debt Has Been Frozen at $18,112,975,000,000

By Terence P. Jeffrey | April 7, 2015 | 1:28 PM EDT

U.S. Treasury in October 2013. (AP Photo/Carolyn Kaster)

(CNSNews.com) - According to the Daily Treasury Statement for Friday, April 3, which was published by the U.S. Treasury on Monday, April 6, that portion of the federal debt that is subject to a legal limit set by Congress closed the day at $18,112,975,000,000—for the 21st day in a row.

$18,112,975,000,000 is about $25 million below the current legal debt limit of $18,113,000,080,959.35.

The debt first hit $18,112,975,000,000, according to the Daily Treasury Statement, on March 13, which was the day Treasury Secretary Jacob Lew sent a letter to House Speaker John Boehner and other congressional leaders saying that he was planning to declare a “debt issuance suspension period.”

This was necessary, Lew explained, because in 2014 Congress enacted legislation that “suspended” the debt limit until March 15 and then reinstated it on that date at whatever level the debt had reached by then.

 

"As you know, in February 2014, Congress passed the Temporary Debt Limit Extension Act, suspending the statutory debt limit through March 15, 2015,” Lew said in his March 13 letter. “Beginning on Monday, March 16, the outstanding debt of the United States will be at the statutory limit. In anticipation of reaching that date, Treasury has suspended until further notice the issue of State and Local Government Series securities, which count against the debt limit."

State and Local Government Series securities, the Congressional Research Service explains, are “customized securities available for state and local governments to hold proceeds of bond sales,” and are considered part of the federal government debt that is held by the public.

“Because Congress has not yet acted to raise the debt limit,” Lew said in his March 13 letter, “the Treasury Department will have to employ further extraordinary measures to continue to finance the government on a temporary basis. Therefore, beginning on March 16, I plan to declare a ‘debt issuance suspension period’ with respect to investment of the Civil Service Retirement and Disability Fund and also suspend the daily reinvestment of Treasury securities held by the Government Securities Investment Fund and the Federal Employees’ Retirement System Thrift Savings Plan."

Lew noted that these same actions had been taken “during previous debt limit impasses.”

For example, as CNSNews.com reported, when Secretary Lew declared a debt issuance suspension period in 2013, the Treasury reported the debt subject to the limit was frozen at $16,699,396,000,000 for 150 days, running from mid-May to mid-October of that year.

On March 16 and 17 Lew sent additional letters to Congress further explaining the actions he would be taking during the “debt issuance suspension period” that began on March 16. The Treasury also posted Frequently Asked Question sheets that explained the actions and their statutory basis.

“Under current law, if the Secretary of the Treasury determines that the issuance of obligations of the United States may not be made without exceeding the debt limit, a ‘debt issuance suspension period’ may be determined,” the Congressional Research Service explained in a report published on March 27. “This determination gives the Treasury the authority to suspend investments in the Civil Service Retirement and Disability Trust Fund, Postal Service Retiree Health Benefit Fund, and the Government Securities Investment Fund (G-Fund) of the Federal Thrift Savings Plan.

“In addition,” said CRS, “this gives Treasury the authority to prematurely redeem securities held by the Civil Service Retirement and Disability Trust Fund and Postal Service Retiree Health Benefit Fund.”

"The total federal debt consists of debt held by the public and intragovernmental debt," the CRS explained in a report published in 2011. "Debt owed to the public represents borrowing from entities other than the federal government, and includes borrowing from state and local governments, the Federal Reserve System, and foreign central banks, as well as private investors in the United States.

"Intragovernmental debt," said CRS, "consists in debt owed by one part of the federal government to another, which are mostly held in trust funds."

The net effect of the Treasury’s actions is that although the publicly held debt of the government continues to fluctuate--as the Treasury redeems maturing debt held by the public and issues new debt held by the public—the overall debt subject to the limit set by Congress closes each business day at $18,112,975,000,000.

As of March 13, according to the Daily Treasury Statement, the federal debt held by the public was $13,083,880,000,000. By April 2, it had risen to $13,096,592,000,000; and, by April 3, it had risen to $13,113,626,000,000.

But on all days from March 13 through April 3, the federal debt subject to the legal limit set by Congress was 18,112,975,000,000.

The business and economic reporting of CNSNews.com is funded in part with a gift made in memory of Dr. Keith C. Wold.