Treasury: We’ve Kept Debt Exactly $16,699,396,000,000 For 4 Months

By Terence P. Jeffrey | September 19, 2013 | 9:13am EDT

Treasury Secretary Jack Lew and Barack Obama (AP Photo/Carolyn Kaster)

( - At 4:00 p.m. on Wednesday, the U.S. Treasury released its daily statement revealing how the accounts of the federal government stood as of the close of business on Tuesday, Sept. 17.

According to this official accounting,  the federal government's debt that is subject to a legal limit set by Congress stood at exactly $16,699,396,000,000 at that hour yesterday.

That marked the fourth straight month that the U.S. government’s debt has ended up at exactly $16,699,396,000,000 at the close of each business day.

Coincidentally, $16,699,396,000,000 is about $25 million below the legal limit on the debt—which is currently set by law at $16,699,421,095,673.60.

If at the close of any business day, the debt were to slip just $26 million higher, it would exceed the legal limit.

Instead, at the close of every business day since May 17, the debt has remained just $25 million below the limit.

This is despite the fact that the Treasury has continued to sell more Treasury securities than it is redeeming and to run massive deficits.

In May, the month the Treasury froze the debt subject to the legal limit at $16,699,396,000,000, the federal government ran a deficit of $138.732 billion for the month, according to the Treasury’s monthly statement.  In June, the Treasury said the government ran a one-month surplus of $116.501. But then it ran a deficit of $97.597 billion in July and $147.923 billion in August.

In sum, from May through August, the federal government ran a net deficit $267.751, according to the Treasury’s monthly statements.

In the first eleven months of this fiscal year (October 2012 through August 2013), the federal government ran a deficit of $755.345 billion, according to the Treasury.

During the period that the Treasury has kept the debt frozen just $25 million below the legal limit, Treasury Secretary Jack Lew says that the Treasury has been using “extraordinary measures” to keep the debt from exceeding the legal limit.

On May 17, when the Treasury first froze the debt at $16,699,396,000,000, Lew sent a letter to House Speaker John Boehner stating: “In total, the extraordinary measures currently available free up approximately $260 billion in headroom under the limit, as described below.”.

Among the “extraordinary measures” Lew said he could take to create this “headroom”:1) not investing new money from the Civil Service Retirement and Disability Fund (CSRDF) in U.S. Treasury securities, which he said would create $6.4 billion in “headroom” per month, 2) not reinvesting $58 billion ion Treasury Securities held by the CSRDF that would be maturing and not reinvesting $16 billion in interest owed to the fund, which would create $74 billion in headroom, 3) suspending the routine daily reinvestment of $160 billion in special Treasury securities held by the Federal Employees’ Retirement System Thrift Savings Plan, which would create another $160 billion in headroom, and 4) suspending the routine daily reinvestment of Treasury securities held by the government’s own Exchange Stabilization Fund, which would create another $23 billion in headroom.

On May 20, Lew sent a letter to Boehner saying the “debt issuance suspension period” he had declared would “last until August 2, 2013, the last day that Congress is expected to be in session before Labor Day.”

However, on Aug. 2, Lew sent Boehner another letter. This time, he said: “I have determined that a ‘debt issuance suspension period,’ previously determined to last until August 2, 2013, will continue through October 11, 2013, the last day Congress is expected to be in session before the Columbus Day recess.”

Then, on Aug. 26, Lew sent Boehner another letter stating: "Based on our latest estimates, extraordinary measures are projected to be exhausted in the middle of October."

Between now and then, President Obama and the leaders of the Republican-controlled House will need to negotiate and enact new legislation authorizing federal spending. That is because the current law authorizing federal spending expires on Sept. 30.

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