According to The Hill, the Treasury Department would have to cut spending by 44% overnight if the debt ceiling isn't raised. A tough job no doubt, but the result apparently would be chaos;
The report released Tuesday concludes that Treasury would not be able to pay all its bills between Aug. 2 and “probably” not later than Aug. 9 if the debt ceiling is not increased.
Handling all payments for important and popular programs including entitlements and military pay will quickly become impossible, it says.
The day-by-day picture of default shows a 44 percent cut in federal spending. It concludes that the daily inflows of revenue and outflows of obligations are “lumpy” and that it would be difficult for Treasury to prioritize 80 million different payments. For the month of August, the deficit from Aug. 3 to Aug. 31 would be $134 billion.
If you are going to be cutting 44 percent of the budget overnight, you are going to be cutting many popular programs, there is no way to avoid it, Powell told reporters Tuesday.
The result would be chaotic, he said, noting the current inability of Treasury computers to handle the payments.
This isn't September 11th, 2001 though. It's not like hitting the debt ceiling limit is coming as a surprise and it's not as if the ceiling hasn't been in sight before. So why no disaster planning? I'm putting it down to government planning - in other words do the minimum required and don't consider scenarios that aren't in your job description. Way to go guys.
"So why no disaster planning?" I ask this question myself. It's like the men in suits planned this beforehand, and somehow they're getting something out of all the chaos.
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Hey, not all men in suits are bad guys. And I don't give most people the wherewithal to pull of planning of this magnitude.
ReplyDeleteI do think there are plenty of people who are reaping the benefits of the downturn.