6/8/2017

DEBT/ECONOMY/POLITICS: “Once again, economists must consider the risk that Congress may be unable to easily deal with the nation’s statutory borrowing limit.
Forecasters in The Wall Street Journal’s monthly survey have raised their assessments of the risk facing the U.S. economy. For the first time since the presidential election, a majority of economists in the survey are concerned the economy could do worse than forecast.
That is a reversal from earlier in the year, when the possibility of rapid moves to reform the tax code or create a $1 trillion infrastructure package seemed like they could happen quite quickly and boost the economy.
Congressional deadlocks over fiscal policy have repeatedly lasted until the 11th hour in recent years, raising the specter of the government not paying the nation’s debts. Congress has always ultimately raised the debt ceiling, but one skirmish in 2011 led Standard & Poor’s to lower its rating of U.S. debt.
The nation hit its debt ceiling back in March, and the Treasury has been relying on cash-management strategies to pay the nation’s bills. The Bipartisan Policy Center, a think tank that tracks Treasury’s cash balances, estimates those strategies may only work through October, and Congress is running low on legislative days before taking its August recess.”

-Josh Zumbrun, “Unresolved U.S. Debt Ceiling Casts a Shadow Over Many Forecasters’ Economic Outlooks,” The Wall Street Journal online, June 8, 2017 10:03am