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Mnuchin Makes 2nd Emergency Debt Move  12/12 06:23

   Treasury Secretary Steven Mnuchin said Monday he is making a second 
emergency move to keep the government from going above the debt limit while 
awaiting congressional action to raise the threshold.

   WASHINGTON (AP) -- Treasury Secretary Steven Mnuchin said Monday he is 
making a second emergency move to keep the government from going above the debt 
limit while awaiting congressional action to raise the threshold.

   In a letter to congressional leaders, Mnuchin said he will not be able to 
fully invest in a large civil service retirement and disability fund. Skipped 
investments will be restored once the debt limit has been raised, he said.

   In September, Congress agreed to suspend the debt limit, allowing the 
government to borrow as much as it needed. But that suspension ended Friday.

   The government said the debt subject to limit stood at $20.46 trillion on 
Friday. Mnuchin has said he will employ various "extraordinary measures" to buy 
time until Congress raises the limit.

   The Congressional Budget Office estimated in a recent report that Mnuchin 
has enough maneuvering room to stay under the limit until late March or early 
April.

   If Congress has not acted before Mnuchin has exhausted his bookkeeping 
maneuvers, the government would be unable to borrow the money it needs to meet 
its day-to-day obligations, including sending out Social Security and other 
benefit checks and making interest payments on the national debt.

   In August 2011, a standoff between Congress and the Obama administration 
over raising the borrowing limit came down to the wire and prompted the 
Standard & Poor's credit rating agency to impose the first-ever downgrade of 
the government's credit rating.

   Raising the debt limit is a separate issue from the need for Congress to 
pass a spending bill to cover government operations. A failure to pass a 
spending bill triggers a partial government shutdown but does not carry the 
potential catastrophic market disruptions that a failure to raise the debt 
limit poses.

   In his new letter, Mnuchin said, "I respectfully urge Congress to protect 
the full faith and credit of the United States by acting to increase the 
statutory debt limit as soon as possible."


(KA)

 
 
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