Look past the smoke from the Trump White House funeral pyre, and you'll see financial Armageddon [View all]

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Look past the smoke from the Trump White House funeral pyre, and you’ll see financial Armageddon
By Jonathan Capehart July 13 at 3:46 PM

There is so much smoke from the funeral pyre that is President Trump’s White House, its ties to Russia and the fool’s errand that is the effort to repeal and replace Obamacare that you’d be forgiven for not seeing the cliff over which the United States is about to plunge. Yep, I’m resuming my role as town crier about the debt ceiling because all this mind-boggling stuff we’re talking about now (Donald Trump Jr.’s emails?!) will pale in comparison to the financial Armageddon that awaits us if our fiscal car pulls a “Thelma and Louise.”

You might remember that at a congressional hearing on May 24, when asked when the debt ceiling would have to be raised to avoid default, White House budget director Mick Mulvaney went all ¯_(ツ _/¯ and said that it was his understanding that “the receipts, currently, are coming in a little bit slower than expected.” Tax receipts, that is, which means the treasury, already employing “extraordinary measures” to keep below the legal limit on federal borrowing, has less cash on hand to tread water until Congress gets around to raising that limit.
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The Bipartisan Policy Center estimated last March that sometime between October and November, the U.S. treasury might not have enough cash on hand to meet all of its financial obligations. That’s what it calls the “X date.” Well, on Wednesday, the nonprofit that lives up to its name revised its prediction.



(Courtesy Bipartisan Policy Center)

“There is currently significant evidence to support an ‘X Date’ within the early to mid-October period,” the BPC announced. And this squares right up with what the CBO reported late last month. Early October is not only critical because it is the start of a new budget year. Specifically, on Oct. 2, as the BPC has been pointing out for months, Treasury must pump money into the Military Retirement Trust Fund. That payment was $81 billion in 2016. ... The federal government not having enough money on hand to pay all of its bills on time would destroy the full faith and credit of the United States and throttle the American people in ways unimaginable. “When we’re talking about the payments that the government makes, these are to every American individual out there,” Shai Akabas, director of fiscal policy at BPC, said on a call with reporters on Wednesday. “Almost every single person gets some payment from either directly or indirectly from the federal government. So, whether, it’s Social Security beneficiaries, doctors who provide Medicare and Medicaid and the patients that they rely on them, welfare recipients … federal employees. These are all people who are waiting for payments from the government and people are waiting, then, in turn for payments from those people or businesses because the economy is obviously very dynamic and relies on each payment going before the next payment.”
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The reality-show presidency of Donald Trump is about to get real for every American real quick. Buckle up.

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