So messed up are the government’s books that experts don’t know when the cooked books, which have been cooked since May 17, will finally overflow onto the fiscal stove. It could be October 18. It might be as late as November 5.
Officially, the federal debt has not risen by one penny since May 17. But the deficit rose by $146 billion in August alone.
This is the finest public experiment in cooked books that we have seen. The Secretary of the Treasury calls this “extraordinary measures,” not “cooked books.” Call it what they will, the body politic is getting a lesson in the games that federal statisticians play.
Obama says he will not consent to spending cuts. Boehner says he will not consent to raise taxes without spending cuts. One of them will back down. Otherwise, the federal government will have to stop sending out money.
The Congressional Budget Office in May predicted that the federal deficit in fiscal 2013 would be precisely $642 billion, down from $1.1 trillion last year. In July, the CBO revised this to $759 billion. Such precision! Not $640 billion. No: $642 billion. Not $760 billion. No: $759 billion. The CBO fakes it with such verve. But faked it is.
We will now get anywhere from five weeks of posturing by Obama and Boehner to seven weeks. The Bipartisan Policy Center reports the following. The government must pay $12 billion in Social Security benefits on Oct. 23, $6 billion in interest payments on Oct. 31, and $55 billion in Medicare, Social Security, military and veterans benefits on Nov. 1.
The group also said that spending cuts that would be required if the debt ceiling isn’t raised could be quite steep. For example, BPC said if the “X-date” arrives Oct. 18, the government would be $106 billion short on its bills between Oct. 18 and Nov. 15, leaving the government unable to pay 32% of the required funds during that time.
It’s the showdown at the Not OK Corral.