As red ink recedes, pressure fades for budget deal
By Lori Montgomery and Zachary A. Goldfarb, WashPost, Updated: Tuesday, May 7, 2:42 PM
After four years of trillion-dollar deficits, the red ink is receding rapidly in Washington, easing pressure on policymakers and shattering hopes for a summertime budget deal.
Federal tax revenue is up and spending is down thanks to an improving economy, tax hikes enacted in January and the hated budget cuts known as the sequester. As a result, the U.S. Treasury has slowed the pace of borrowing from the frantic days of the 2008 economic crisis and actually expects to repay a tiny fraction of the $16.8 trillion national debt by the end of June.
The slower borrowing rate means the Obama administration will be able to pay the nation’s bills for months without new borrowing authority from Congress — likely until Oct. 1, according to new independent forecasts. That might seem like good news, but it is unraveling Republican plans to use the debt-limit deadline to force a budget deal before Congress takes its August break.
Instead, the fiscal fight now appears likely to bleed into the fall, when policymakers will face another multi-pronged crisis that pairs the risk of default with the prospect of a full-scale government shutdown.
(More here.)
After four years of trillion-dollar deficits, the red ink is receding rapidly in Washington, easing pressure on policymakers and shattering hopes for a summertime budget deal.
Federal tax revenue is up and spending is down thanks to an improving economy, tax hikes enacted in January and the hated budget cuts known as the sequester. As a result, the U.S. Treasury has slowed the pace of borrowing from the frantic days of the 2008 economic crisis and actually expects to repay a tiny fraction of the $16.8 trillion national debt by the end of June.
The slower borrowing rate means the Obama administration will be able to pay the nation’s bills for months without new borrowing authority from Congress — likely until Oct. 1, according to new independent forecasts. That might seem like good news, but it is unraveling Republican plans to use the debt-limit deadline to force a budget deal before Congress takes its August break.
Instead, the fiscal fight now appears likely to bleed into the fall, when policymakers will face another multi-pronged crisis that pairs the risk of default with the prospect of a full-scale government shutdown.
(More here.)
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