With Spending Bill Passed, More Fiscal Steps Ahead
Yesterday, the Senate passed the Omnibus appropriations act (72-26), following strong passage in the House (359-67). The bill will now be sent to President Obama to sign. Earlier in the week, we took a look at what is in the $1.1 trillion spending bill, and also documented the winners and losers.
Although the threat of a government shutdown is over, we haven't cleared all impending fiscal hurdles just yet. Yesterday, Treasury Secretary Jack Lew warned that the nation is more likely to run out of borrowing authority before the end of February than later. Though the debt limit is technically suspended on February 7, the Treasury can use extraordinary measures to free up borrowing authority to continue paying the country's bills for a short while.
Originally, Treasury Secretary Lew said that these extraordinary measures wouldn't be exhausted until the end of February or early March. Now, however, he believes it's likelier these measures will run out by the end of February. Traditionally, February and March are high-deficit months for the government, when it pays out tax refunds and doesn't yet collect much of its tax season revenue until April. This severely limits the ability of the government to pay bills without issuing new debt during those months.
Read more about understanding the debt limit here, a Q&A on everything you need to know about the debt ceiling here, and about why we need to address our long term debt problems here.