The debt ceiling refers to the maximum amount of money the U.S. Federal government can owe and it currently stands at $16.4 trillion. Based on current projections by the Treasury Department and the Congressional Budget Office, we will hit the limit by the end of the year. In order to keep financing its operations, the Federal government needs Congress to pass a bill authorizing an increase to the debt ceiling. The last time we were close to the debt ceiling, the increase lead to a protracted political negotiation. Without this authorization, it is likely that the country's credit rating would risk being downgraded once again as the U.S. would not be able to borrow more money to pay maturing loans or refinance existing debt.
Learn more from the Los Angeles Times.
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