![]() The Senate is planning to be in session a total of 28 days between now and October 31, and the House, which doesn’t return until September 20, has only 18 legislative days on its schedule-and both chambers plan to spend a majority of that time debating the second installment of President Biden’s Build Back Better agenda. October may seem far off, but the number of legislative days between now and October 31 is woefully few. ![]() ![]() Simply put, Secretary Yellen isn’t exactly sure how much revenue the Treasury will collect in the next 60 days, nor how much money it will have to disburse. The government will receive an infusion of cash in mid-September from quarterly estimated corporate and individual income tax payments, but the current surge in coronavirus infections across the nation, recent devastation caused by hurricane Ida and wildfires out west, and the cost of processing and resettling tens of thousands of Afghan refugees, all complicate Treasury’s short-term forecast of daily receipts and outlays. Absent any action by Congress soon, the Treasury will run out of cash. Since then, Treasury has employed a host of temporary extraordinary measures to preserve cash, curtail the issuance of Treasury securities, and avoid breaching the statutory debt limit, but these strategies have a finite lifespan. The federal government has been operating on borrowed time since the debt limit was reinstated on August 1. Yellen was unable to give an exact date on which Treasury’s cash reserves would be insufficient to meet its obligations but did say, “the most likely outcome is that cash and extraordinary measures will be exhausted during the month of October.” debt limit condition to DEFCON 2: default is not imminent, but it’s getting really, really close. ![]() In a letter sent to Congressional leaders this week, Treasury Secretary Janet Yellen essentially elevated the U.S. For example, DEFCON 1 would signal the outbreak of nuclear war. It increases in severity from DEFCON 5 (least severe) to DEFCON 1 (most severe) to match varying military situations. The United States Armed Forces uses an alert system called the “defense readiness condition” (DEFCON) to describe different levels of readiness, or states of alert, for military personnel. ![]()
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