Gregory Korte, USA TODAY
WASHINGTON - The United States will run out of borrowed money "no later than Oct. 17" unless Congress raises the $16.7 trillion debt limit, Treasury Secretary Jacob Lew said in a letter to Congress Wednesday morning.
Lew's letter marks the first time he has given a date certain for when the government would hit the debt ceiling. Outside economists had previously estimated that date to be sometime from October 18 to Nov. 5.
The Treasury Department has been undertaking what it calls "extraordinary measures" to keep the nation under the debt limit since May. Those measures include delaying pension fund payments.
"If we have insufficient cash on hand, it would be impossible for the United States of America to meet all of its obligations for the first time in our history," Lew said.But as of Oct. 17, the Treasury expects its cash-on-hand will be reduced to $30 billion. The government typically spends $60 billion every day.
Once that happens, the government would only have enough money to pay its bills as it has revenue on any given day. Treasury officials have rejected proposals to sell off assets, cut payments across the board or prioritize some payments over others.
Lew's warning comes as Congress debates another measure to authorize spending for the new fiscal year beginning Oct. 1. A House-passed resolution would keep the government spending roughly at current levels and also extend the debt ceiling -- but only for paying the principal and interest on the debt.
Lew said any attempt to prioritize some payments over others "is simply default by another name."