Debt limit
The statutory ceiling on total federal borrowing, which constrains paying for spending Congress has already approved.
The debt limit caps the total amount the Treasury may borrow. It authorises no spending and cancels none; it governs the financing of obligations Congress has already created through appropriations and permanent law. Raising it permits payment for commitments already made rather than approving new ones.
When the ceiling binds, the Treasury resorts to what it calls extraordinary measures, an established set of accounting steps that free up borrowing capacity for a period, ending on an estimated date after which obligations could not all be met. That date is an estimate dependent on tax receipts, and it moves as revenue data arrives.
Because raising the limit is a discrete, must-pass vote, it recurs as leverage for unrelated negotiations. Suspensions rather than dollar increases have become the common form, which is why coverage refers to the limit being suspended until a date rather than raised to a number. Provisions dealing with it can move through budget reconciliation.
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