Treasury Secretary Snow warns Congress: US government's cash running out

[w¡n9Nµ7 §£@¥€r 123]

Treasury Secretary John Snow urged Congress to set aside partisan bickering and raise the US national debt ceiling this week, or face a disastrous cash crunch for the federal government.

In a speech here to a conference of regional bankers, Snow said it would be inconceivable for Congress not to pass legislation on the debt limit before it heads into a recess at the end of this week.

"I am urging members of Congress in the strongest possible terms to resist coupling an increase in the debt ceiling with other issues," Snow said.

"Rather, they should vote to raise the ceiling this week. It would be unthinkable for them not to take action," he said, warning that the "full faith and credit" of the US government was too precious to be compromised.

Snow has issued increasingly urgent warnings to Congress that the statutory debt limit of 8.184 trillion dollars will be hit this week, and that the government will then lose its borrowing power.

Once the US government reaches the ceiling, it comes under threat of defaulting on its debts and can lose the ability to raise future credit on the capital markets.

Last week, Snow said new issues of federal debt instruments would only raise enough cash to keep government operations financed until mid-March.

But Democratic members of Congress are said to be balking at increasing the debt limit unless the administration of President George W. Bush, which has overseen a huge rise in the US budget deficit, curbs its appetite for funds.

"We have to remember that current federal borrowing needs today are simply the product of past decisions," Snow said in his speech.

"While we always welcome a debate on budget priorities, swift action on the debt limit must still be taken this week.

"There should be no doubt over whether the government will be able to pay its bills on time, this time next week."

[Mr. Big Dog 10,747]

All credit cards maxed out again? Already? Get a few new ones, then...

[w¡n9Nµ7 §£@¥€r 123]

A question for people who know these things:

What happens if the ceiling is not raised and the government is unable to pay its bills?

[pax 0]

I guess W will have to try to hide Air Force One from the repo man...?

[Saddle Bronc 124]

A question for people who know these things:

What happens if the ceiling is not raised and the government is unable to pay its bills?

That's like asking in Canada "what happens if the MP's vote DOWN a pay raise?"

Basically, hypothetical situation which won't occur due to pols' addiction to taxpayer pork.

[Mr. Big Dog 10,747]

A question for people who know these things:

What happens if the ceiling is not raised and the government is unable to pay its bills?

Ask the folks in Argentina. They had a fiscal disaster a few years ago.

[I'm Gone 60]

The jerks will dip into my Thirft Savings Plan G Fund money until they can stop playing politics and raise the limit.

[w¡n9Nµ7 §£@¥€r 123]

A question for people who know these things:

What happens if the ceiling is not raised and the government is unable to pay its bills?

Ask the folks in Argentina. They had a fiscal disaster a few years ago.

If I had a clear understanding of what happened in Argentina, I wouldn't be asking the question.

I'm looking for a technical explanation from someone who knows these things. I am googling it up in the meanwhile.

[Mr. Big Dog 10,747]

A question for people who know these things:

What happens if the ceiling is not raised and the government is unable to pay its bills?

Ask the folks in Argentina. They had a fiscal disaster a few years ago.

If I had a clear understanding of what happened in Argentina, I wouldn't be asking the question.

I'm looking for a technical explanation from someone who knows these things. I am googling it up in the meanwhile.

Argentia just came to mind as I remember that crash and how our risk dept folks at the time were all on blood pressure controlling meds.

Here's a little something to read:

As lawmakers hem and haw, the Treasury Department is raiding the civil service retirement trust fund to pay the government's bills. If Congress fails to act before it goes on recess next week, it's possible that the United States will default on its obligations -- rocking global financial markets and possibly leaving Americans stuck with higher interest rates for decades to come.

http://money.cnn.com/2006/03/03/news/econo....reut/index.htm

http://money.cnn.com/2006/03/14/news/econo...ggedin_fortune/

It's nothing good, that's for sure...

[Mirorgate 0]

A question for people who know these things:

What happens if the ceiling is not raised and the government is unable to pay its bills?

Ask the folks in Argentina. They had a fiscal disaster a few years ago.

If I had a clear understanding of what happened in Argentina, I wouldn't be asking the question.

I'm looking for a technical explanation from someone who knows these things. I am googling it up in the meanwhile.

Argentia just came to mind as I remember that crash and how our risk dept folks at the time were all on blood pressure controlling meds.

Here's a little something to read:

As lawmakers hem and haw, the Treasury Department is raiding the civil service retirement trust fund to pay the government's bills. If Congress fails to act before it goes on recess next week, it's possible that the United States will default on its obligations -- rocking global financial markets and possibly leaving Americans stuck with higher interest rates for decades to come.

http://money.cnn.com/2006/03/03/news/econo....reut/index.htm

http://money.cnn.com/2006/03/14/news/econo...ggedin_fortune/

It's nothing good, that's for sure...

And the foreign investors call in their markers for payments that we can't afford to pay. So instead of president, we have a PM who sits in England/Finland/where ever as they "bought" us out of debt.

[almaty 19]

i know the state of illinois had this issue in the past..all government, non essential employees are laid-off and all services stopped....that is non-essential

[pedroh 21]

or China will assume a big control of the US debt, being that country the main debt buyer of US.. lol.. I'd think there would be a dollar devaluation.. and high interests rates? what.. from 15 to 25%? lol.. nothing new to us latin americans.. still debt'd be cheaper than in my country, and still manageable for me

mhh good time to start buying euros or pounds..

[Fuzzness 2]

Maybe they should start taxing rich people again....

[Mr. Big Dog 10,747]

Maybe they should start taxing rich people again....

But did you not know that not taxing the super rich actually makes the feds more money?

[Fuzzness 2]

Maybe they should start taxing rich people again....

But did you not know that not taxing the super rich actually makes the feds more money?

Oh sh!t we can't have that now can we?

Cutting the politicians salary will give them more money too... that is so incredibly unacceptable. People won't stand for it!