The Debt Ceiling Time Bomb Is Ticking Again. This Could Be the Year It Explodes.

For a little more than a year, the looming partisan fight over the debt ceiling hovered over the nation’s economic future, lurking just out of sight like a monster in a horror movie or Jason Momoa on a red carpet—an inescapable problem that has not yet arrived but is destined to knock you (or the global economy) over with unsettling speed.

After a bracing fight in the fall of 2021, Congress raised the debt ceiling by $2.5 trillion, ensuring that the country would not hit its borrowing limit until 2023. But future problems have a way of transforming into current ones with the passage of time: On Friday, Treasury Secretary Janet Yellen told congressional leaders that the country is expected to hit the statutory limit of more than $31.4 trillion this week, forcing the government to employ “extraordinary measures” to avoid default. But in practice, the measures don’t seem so extraordinary: They are merely the equivalent of extending a deadline. As Yellen noted in a letter, it “enables the government to meet its obligations for only a limited amount of time.”

“While Treasury is not currently able to provide an estimate of how long extraordinary measures will enable us to continue to pay the government’s obligations, it is unlikely that cash and extraordinary measures will be exhausted before early June,” Yellen wrote. Thus Congress, world-renowned for its speedy problem-solving, has only a few months at best to figure out a solution.