National debt jumps $175 billion after debt ceiling suspended

Date: Feb 08, 2018

Source:

http://www.washingtonexaminer.com/national-debt-jumps-175-billion-after-debt-ceiling-suspended/article/2648874

 

The national debt increased by $175 billion on Friday, the same day President Trump signed legislation that allowed new federal borrowing by effectively turning off the debt ceiling for more than a year.

The debt ceiling was reimposed in December, at a level of about $20.494 trillion, and the U.S. was unable to borrow any money above that amount over the last two months.

That pent-up borrowing demand led to an immediate spike in the debt on Friday, when the borrowing limit was suspended again. The government reported Monday that the new national debt was $20.699 trillion at the end of last week. The data lags by one business day.

Friday's jump is the first of what is expected to be several increases in the national debt, which will now be allowed to grow unchecked for more than a year, through March 1, 2019. In light of the new spending Republicans and Democrats agreed to this week, the debt could easily grow by more than $1 trillion by early 2019.

The suspension of the debt ceiling is one of the many aspects of the broad spending deal reached by Senate leaders that conservatives opposed. Conservatives have sought spending reductions as a condition of getting them to vote for a debt ceiling hike.

But this time around, Republicans and Democrats in the Senate agreed to a broad range of spending increase, in addition to a yearlong elimination of any federal borrowing limits.

In past years, Congress was more likely to increase the acceptable level of debt to some new, specific limit. But the last several times the U.S. has hit the debt ceiling, Congress has responded by suspending it all together — a move that effectively turns off the limit for a specified amount of time.