US Government Debt Different - Finance Department - University of ...

Jeremy Kreisberg & Kelley O’Mara (Under the Supervision of Professor Howell Jackson)313Appendix A: Timeline of Actions During 2011 Debt Limit ImpasseDateEventFebruary 12, 2010 • Congress passes legislation raising the debt limit to $14.29 trillion.January 6, 2011 • Secretary Geithner writes Congress that the outstanding debt stood at$13.95 trillion, leaving only $335 billion of borrowing authority.February 3, 2011 • Treasury began to draw down its $200 billion Supplementary FinancingAccount at the Federal ReserveApril 15, 2011 • After long negotiations, Congress passes the Department of Defense andFull-Year Continuing Appropriations Act, 2011 to fund the governmentfor the rest of the fiscal year, narrowly averting government shutdown forthe second time in 8 days.May 6, 2011 • Secretary Geithner suspended the issuance of State and Local GovernmentSeries Treasury Securities (“SLGS”) to slow the increase in theoutstanding debt.May 16, 2011 • National debt reaches debt limit of $14.29 trillion.• Secretary Geithner declares a “Debt Issuance Suspension Period,” toenable actions affecting the G-Fund, Civil Fund, and Postal Fund.July 12, 2011 • In a CBS interview, President Obama warns that he cannot “guarantee”that Social Security checks will go out if the limit is reached.July 15, 2011 • Secretary Geithner suspends reinvestments in the portion of the ESF heldin US Dollars.August 2, 2011 • Budget Control Act becomes law and debt limit is raised instantly by $400billion to $14.69 trillion, following a Presidential Certification.• G-Fund, Civil Fund and Postal Fund suspended principal investmentswere reinvested in Treasury securities.• SLGS issuances resumed.August 3, 2011 • Interest due to the G-Fund was invested in Treasury securities.August 5, 2011 • Standard & Poor’s downgraded the long-term sovereign debt credit ratingfor U.S. Treasuries from AAA to AA+, citing the political brinksmanshipobserved during the impasse.September 22, 2011 • Debt limit was raised by $500 billion to $15.19 trillion, as called for byBCA, despite a House disapproval measure.December 30, 2011 • Interest earned by Civil Fund and Postal Fund during impasse wasrestored and invested in Treasury securities.January 12, 2012 • President Obama certified that the outstanding debt subject to the limitwas within $100 billion of the statutory limit.January 28, 2012 • Debt limit was raised by $1.2 trillion to $16.39 trillion, despite a Housedisapproval vote.