While it is good news that there is a framework for a debt deal, the dramatic events of Thursday night is a reminder that it ain’t over until it’s over. If the anger of progressives or the obstinance of Tea Partyers in the House scuttle this deal, we’ll be staring default directly in the face. If the national debt limit isn’t raised by midnight tomorrow , President Obama will have to prioritize which bills the nation will honor with the limited cash on hand. If you thought the last two weeks were horrifying, pray we won’t have to witness that ugly and heart-wrenching process, which is guaranteed to roil the markets and enrage the citizenry once the impact is truly felt.
If all of this sounds familiar it should. Throughout this crisis I’ve tried to make real what many view as an abstract battle that only has relevance inside the Beltway. To that end I want to show you again the vivid charts from the Bipartisan Policy Center that show what could happen on Wednesday, Thursday and Friday of this week. Remember, the federal government will have $306 billion in bills and just $172 billion to pay them.
Treasury is expected to take in $12 billion. But it will have $32 billion in expenses. Social Security checks amount to $23 billion of that total. The Treasury’s cash deficit would be $20 billion.
Treasury is expected to take in $4 billion. But it will have $10 billion in expenses. Medicaid and Medicare payments amount to $3.1 billion. The Treasury’s cash deficit would be $26 billion.
Treasury is expected to take in $7 billion. But it will have $12 billion in expenses. Medicaid and Medicare payments, unemployment benefits, welfare, food stamps and federal salaries and benefits amount to $6.7 billion. Treasury’s cash deficit would be $31 billion.
The clock continues to click toward default until the deal is done. So, folks, get ’er done.