The Shutdown Won't Save Us From the Debt Limit

A blog about business and economics.
Oct. 3 2013 12:02 PM

The Shutdown Won't Save Us From the Debt Limit

Yep, we're doomed.

Photo by JEWEL SAMAD/AFP/Getty Images

Kevin Drum asks whether the government shutdown has slowed federal spending enough to substantially forestall the debt ceiling. I don't know, but I do know that the Treasury Department has not offered any reassuring new updates and that at the end of September Goldman Sachs sent around a note saying that basically it doesn't:

Federal salary payments might decline by around $2 billion, and payments to contractors could decline by a few billion more over the course of a week. Since the Treasury’s projection that it will exhaust its borrowing capacity by the October 17 deadline is based on debt issuance expectations, not only on cash flows, a shutdown over a limited period would probably not affect that deadline. It could delay by a few days the date on which the Treasury would deplete its remaining cash balance after October 17. However, even with a week-long shutdown, our projections imply that it is very unlikely that the Treasury would be able to stretch its cash balances past October 31, because of the large payments scheduled to be made that day.

Back on Tuesday, there was a $6 billion interest payment on the national debt. On the 15th there's another $2 billion payment. On the 23th, there's a $12 billion Social Security payment. On the 31st, another $6 billion in interest. Then on Nov. 1, $18 billion in Medicare payments come due along with $25 billion in Social Security checks, $12 billion in military pay, and $3 billion in SSI. The Bipartisan Policy Center is fairly certain those Nov. 1 payments will leave us tapped out.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.



Don’t Worry, Obama Isn’t Sending U.S. Troops to Fight ISIS

But the next president might. 

The Extraordinary Amicus Brief That Attempts to Explain the Wu-Tang Clan to the Supreme Court Justices

Amazon Is Officially a Gadget Company. Here Are Its Six New Devices.

The Human Need to Find Connections in Everything

It’s the source of creativity and delusions. It can harm us more than it helps us.

How Much Should You Loathe NFL Commissioner Roger Goodell?

Here are the facts.

Altered State

The Plight of the Pre-Legalization Marijuana Offender

What should happen to weed users and dealers busted before the stuff was legal?

Surprise! The Women Hired to Fix the NFL Think the NFL Is Just Great.

You Shouldn’t Spank Anyone but Your Consensual Sex Partner

Sept. 17 2014 5:10 PM The Most Awkward Scenario in Which a Man Can Hold a Door for a Woman
  News & Politics
Sept. 18 2014 8:58 AM Does this Colorado Poll Show Latino Voters Bailing on the 2014 Election?
Business Insider
Sept. 17 2014 1:36 PM Nate Silver Versus Princeton Professor: Who Has the Right Models?
The Vault
Sept. 18 2014 9:57 AM “The Sun Never Sets Upon the British Empire,” Explained in GIF by an Old Children’s Toy
  Double X
The XX Factor
Sept. 17 2014 6:14 PM Today in Gender Gaps: Biking
  Slate Plus
Slate Fare
Sept. 17 2014 9:37 AM Is Slate Too Liberal?  A members-only open thread.
Sept. 18 2014 8:53 AM The Other Huxtable Effect Thirty years ago, The Cosby Show gave us one of TV’s great feminists.
Future Tense
Sept. 18 2014 10:07 AM “The Day It All Ended” A short story from Hieroglyph, a new science fiction anthology.
  Health & Science
Bad Astronomy
Sept. 18 2014 7:30 AM Red and Green Ghosts Haunt the Stormy Night
Sports Nut
Sept. 17 2014 3:51 PM NFL Jerk Watch: Roger Goodell How much should you loathe the pro football commissioner?