Hideo Nakamura The Congressional Budget Office (CBO) warned that the United States might not have enough money to pay its bills starting at the beginning of June if nothing is done about the debt ceiling. This worry was echoed by the Treasury Department who said a U.S. default could happen on June 1st.
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The Congressional Budget Office (CBO) just released an updated version of their budget plans for the next ten years – from 2023 to 2033 on Friday. This new report changes some of what they said back in February.
The Cost Analysis Bureau (CBO) creates its plans and predictions for government spending, taxes, deficits, and debt by following certain rules set in law. Currently, the amount of new federal debt we are allowed to take on has been limited to $31.4 trillion according to this law. This limit was reached on January 19th 2023.
The Congressional Budget Office (CBO) estimates that if the U.S. government’s borrowing limit is not increased soon, there is a big risk the Treasury will not be able to pay all its bills by early June. U.S. Treasury Secretary Janet Yellen also said something similar and warned that if Congress doesn’t raise or remove the debt limit soon, we might run out of money around June 1st.
Experts have been warning us about what could happen if the U.S. stops paying back its debts. The International Monetary Fund said it would be really bad. Jerome Powell from the Federal Reserve said it could result in some bad outcomes and Gary Gensler from the U.S Securities and Exchange Commission said there would be long-term impacts on investors, companies and markets. Goldman Sachs even described the potential results as ‘catastrophic’.
Former President Donald Trump wants Republican lawmakers to not pay any money we owe unless the Democrats agree to some spending cuts. He said, “Spending a lot of money isn’t wise”.
Do you think we can still pay our debts by June? Let us know what you think in the comments section!
