Former President Donald Trump described the US debt ceiling as 'meaningless' during a recent interview, raising concerns about the potential economic consequences if it were to be breached. The US reached its debt limit in January 2023 and Congress subsequently suspended it until January 1, 2025. This approaching deadline coincides with the possibility of a government shutdown without a stopgap funding bill, creating a challenging situation for the incoming Trump administration.
Congress last raised the debt ceiling in June 2023, after the U.S. hit the ceiling on Jan. 18 of that year. The lengthy fight did not end in a default on the national debt, but instead that vote to raise and suspend the ceiling through Jan. 1, 2025. Between that Jan. 1 debt ceiling reinstatement and the possibility of a government shutdown without a stopgap funding bill, the incoming Trump administration could face serious problems on day one.
In a phone call with NBC News on Thursday, against that backdrop, Trump suggested that the debt ceiling is a meaningless concept — and that no one knows for sure what would happen if it were to someday be breached — “a catastrophe, or meaningless” — and no one should want to find out. Here's a primer on the national debt, what happens if we default and why it's bad. The national debt ceiling, or debt limit, is essentially a cap, decided by lawmakers, on how much debt the U.S. government can have.Because Congress voted in June to suspend the ceiling, when the debt limit is reinstated on Jan. 1, 2025, the new number When Congress passes a spending bill, they decide what the government will spend its revenue on. That revenue comes mostly from taxes, but also from things like customs duties at the border and the sale of natural resources, according to the Most of the time, the government doesn't have enough revenue on hand to pay for everything in those spending bills — such as infrastructure, social security, Medicare and defense. That's been the case since at least 2001, which was the last time, like bonds. The bond buyer gives the Treasury cash to pay the deficit, and in exchange the Treasury eventually pays the buyer back that money plus interest. The debt limit caps how much debt the Treasury can take on to pay back the deficit incurred in previous years. As of Jan. 18, the Treasury took on the maximum $31.4 trillion in debt allowed — meaning we'd hit the debt limi
DEBT CEILING TRUMP GOVERNMENT SHUTDOWN NATIONAL DEBT US ECONOMY
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