(Thérèse Boudreaux, The Center Square) – Unless Congress suspends or raises the debt ceiling soon, the U.S. government could default on its $36.2 trillion debt by mid-July, according to the newest debt limit analysis.
The Bipartisan Policy Center, which published the analysis Monday, projects the “X Date” will occur somewhere between mid-July and early October 2025, depending on how tax season goes and how much revenue tariffs bring in, among other variables.
During the Biden administration, Congress had suspended the debt limit until Jan. 1, 2025, through the 2023 Fiscal Responsibility Act. On Jan. 17, U.S. Department of the Treasury announced it had hit the debt limit and declared a debt issuance suspension period, which it extended on March 14 to last until June.
The updated deadline range puts new pressure on Congress to move forward in the budget reconciliation process, which allows lawmakers to do things like raise the debt ceiling by a simple majority vote in the Senate.
Both chambers need to pass the same budget resolution — legislation that outlines the federal government’s spending, revenue, debt, and deficit levels — before moving forward in the budget reconciliation process.
But House Republicans are having trouble getting their Senate counterparts on board with a massive $4.5 trillion budget resolution that would extend the 2017 Tax Cuts and Jobs Act by ten years and raise the debt ceiling by $4 trillion.
“We took the first step to accomplish that by passing a budget resolution weeks ago, and we look forward to the Senate joining us in this commitment to ensure we enact President Trump’s full agenda as quickly as possible,” House GOP leaders, including Speaker Mike Johnson, R-La., said in a joint statement Monday. “We encourage our Senate colleagues to take up the House budget resolution when they return to Washington.”
While the House took weeks in February to craft “one big, beautiful bill,” Senate Republicans itching to implement President Donald Trump’s border security and defense policies as soon as possible forged ahead with their own $342 billion budget resolution to do so, saving the TCJA extension for a later date.
After Trump endorsed the House version, Senate Majority Leader John Thune, R-S.D., said the Senate would keep its version as a “back up plan” — a plan he now seems reluctant to let go of as time is ticking.
Part of the reason is how expensive the House’s plan is. The Congressional Budget Office estimates it could add $25 trillion to the national debt over the next decade. Even without extending the TCJA, CBO predicts the debt will hit $52 trillion by 2035.
The Bipartisan Policy Center urged lawmakers to move forward in the budget reconciliation process and “commit to responsible budgeting.”
“Fiscal responsibility is not just about avoiding financial calamity time and time again—it’s about ensuring economic stability and paying our bills on time,” Bipartisan Policy Center President Margaret Spellings said Monday. “This year presents many opportunities to begin getting our fiscal house in order without risking the full faith and credit of the United States.”
