Congress needed to raise the debt ceiling by March 2 but failed to do so. Now, the Treasury cannot sell bonds to pay government bills, such as payments to bond holders and federal benefit recipients.
Luckily, the Treasury has enough cash on hand until this fall, giving Congress an opportunity raise the ceiling or extend it, as it did in February 2018 when it could not reach an agreement on a new debt ceiling.
However, will the Nancy Pelosi-controlled House go along with giving President Trump relief on anything?
Down-to-the-wire debt-limit negotiations in 2011, 2013 and 2015 caused discussions that the U.S. could actually default on its debts. Highly unlikely that would happen. Still, such discussions roiled the stock and bond markets.
What will it be? Raise the ceiling, another extension or elimination of the debt ceiling? The latter is not a stretch. For years, every time this issue arises, getting rid of the debt ceiling is discussed more seriously.