The Debt Limit: History and Recent Increases
D. Andrew Austin
Analyst in Economic Policy
Mindy R. Levit
Analyst in Public Finance
May 2, 2011
Congressional Research Service
7-5700
www.crs.gov
RL31967
CRS Report for Congress
P
repared for Members and Committees of Congress
The Debt Limit: History and Recent Increases
Summary
Total debt of the federal government can increase in two ways. First, debt increases when the
government sells debt to the public to finance budget deficits and acquire the financial resources
needed to meet its obligations. This increases debt held by the public. Second, debt increases
when the federal government issues debt to certain government accounts, such as the Social
Security, Medicare, and Transportation trust funds, in exchange for their reported surpluses. This
increases debt held by government accounts. The sum of debt held by the public and debt held by
government accounts is the total federal debt. Surpluses reduce debt held by the public, while
deficits raise it. Total federal debt outstanding was $14,288 billion on April 29, 2011, of which
$14,236 billion was subject to the debt limit. The U.S. Treasury projects the federal debt will
reach its statutory limit before May 16, 2011. The Treasury Secretary wrote that he would declare
a debt issuance suspension period on that date, unless Congress acted beforehand, which would
allow certain extraordinary measures to extend Treasury’s borrowing capacity until early August
2011. Funding federal operations could soon become complicated without a debt limit increase.
A statutory limit has restricted total federal debt since 1917, when Congress passed the Second
Liberty Bond Act. Congress has voted to raise the debt limit 10 times since 2001, as federal debt
has nearly reached the debt limit several times due to persistent deficits and additions to federal
trust funds. Congress raised the limit in June 2002, and by December 2002 the U.S. Treasury
asked Congress for another increase, which passed in May 2003. In June 2004, the U.S. Treasury
asked for another debt limit increase. After Congress recessed in mid-October 2004 without
acting, the Treasury Secretary told Congress he could keep debt below its limit only through mid-
November. Congress increased the debt limit in a post-election session, which the President
signed on November 19, 2004. In 2005, reconciliation instructions in the FY2006 budget
resolution (H.Con.Res. 95) included a debt limit increase. The Treasury Secretary sent letters
warning Congress that the Treasury would exhaust its options to avoid default by mid-March
2006. Congress passed an increase that the President signed on March 20. The House indirectly
approved legislation (H.J.Res. 43) to raise the debt limit by $850 billion to $9,815 billion. The
Senate approved the resolution on September 27, 2007, and the President signed it two days later.
The recent economic slowdown led to sharply higher deficits in recent years, which led to a series
of debt limit increases. The Housing and Economic Recovery Act of 2008 (H.R. 3221), signed
into law (P.L. 110-289) on July 30, 2008, included a debt limit increase. The Emergency
Economic Stabilization Act of 2008 (H.R. 1424), signed into law on October 3 (P.L. 110-343),
raised the debt limit again. The debt limit rose a third time in less than a year to $12,104 billion
with the passage of the American Recovery and Reinvestment Act of 2009 on February 13, 2009
(ARRA; H.R. 1), which was signed into law on February 17, 2009 (P.L. 111-5).
The House’s adoption of the conference report on the FY2010 budget resolution (S.Con.Res. 13)
on April 29, 2009, triggered the automatic passage of H.J.Res. 45 to raise the debt limit to
$13,029 billion. In August 2009, Treasury reportedly said that the debt limit would be reached in
mid-October, although it later stated that the limit would not be reached until December 2009.
H.R. 4314, passed by the House on December 16, 2009, and by the Senate on December 24,
raised the debt limit to $12,394 billion when the President signed the measure (P.L. 111-123) on
December 28. On January 28, the Senate passed an amended version of H.J.Res. 45, which the
House passed on February 4 and the President signed on February 12 (P.L. 111-139), raising the
limit to $14,294 billion. This report, written with the assistance of Joseph McCormack, will be
updated as events warrant.
Congressional Research Service
The Debt Limit: History and Recent Increases
Contents
Introduction ................................................................................................................................ 1
The Debt Limit and the Treasury........................................................................................... 2
Why Have a Debt Limit?....................................................................................................... 4
A Brief History of the Federal Debt Limit ................................................................................... 5
Origins of the Federal Debt Limit.......................................................................................... 5
World War II and After.......................................................................................................... 6
The Debt Ceiling in the Last Decade ........................................................................................... 6
The Debt Limit Issue in 2002 .............................................................................................. 10
Resolving the Debt Limit Issue in 2002......................................................................... 10
The Debt Limit Issue in 2003 .............................................................................................. 11
The Debt Limit Issue in 2004 .............................................................................................. 12
The Debt Limit Issue in 2005, 2006, and 2007 .................................................................... 13
The Economic Slowdown and Federal Debt ........................................................................ 14
Fiscal Policy Considerations ......................................................................................... 14
Raising the Debt Ceiling in 2008, 2009, and 2010 ......................................................... 15
Deficit Estimates........................................................................................................... 19
Concluding Comments.............................................................................................................. 19
Further Reading ........................................................................................................................ 21
Figures
Figure 1. Components of Federal Debt As a Percentage of GDP, FY1940-FY2009 ...................... 9
Tables
Table 1. Components of Debt Subject to Limit, FY1996-FY2010 ................................................ 8
Table 2. Increases in the Debt Limit Since 1993 ........................................................................ 18
Table A-1. Debt Subject to Limit by Month, September 2001-December 2010........................... 23
Appendixes
Appendix. Debt Subject to Limit by Month Since September 2001............................................ 23
Contacts
Author Contact Information ...................................................................................................... 26
Congressional Research Service
The Debt Limit: History and Recent Increases
Introduction
The statutory debt limit applies to almost all federal debt.1 The limit applies to federal debt held
by the public (that is, debt held outside the federal government itself) and to federal debt held by
the government’s own accounts. Federal trust funds, such as Social Security, Medicare,
Transportation, and Civil Service Retirement accounts, hold most of this internally held debt.2
The government’s surpluses or deficits determine essentially all of the change in debt held by the
public.3 The government’s on-budget fiscal balance, which excludes a small U.S. Postal Service
net surplus or deficit and a large Social Security surplus of payroll taxes net of paid benefits, does
not directly affect debt held in government accounts.4 Increases or decreases in debt held by
government accounts result from net financial flows into accounts holding the debt, such as the
Social Security Trust Fund. Legal requirements and government accounting practices also affect
levels of debt held by government accounts.5
Total federal debt outstanding was $14,288 billion on April 29, 2011, of which $14,236 billion
was subject to the debt limit, about $58 billion below the current statutory debt limit of $14,294
billion.6 Higher individual income tax revenues helped expand the headroom between the federal
debt and its limit in late April. Still, independent analysts expect the federal debt to near its limit
some time in May 2011, with extraordinary cash management measures allowing Treasury
payments to continue satisfying federal obligations until at least July.7
The U.S. Treasury projects the federal debt will reach its statutory limit before May 16, 2011. The
Treasury Secretary, in a letter to Congress dated May 2, 2011, indicated that he would declare a
debt issuance suspension period on May 16, unless Congress acted beforehand, which would
allow certain extraordinary measures to extend Treasury’s borrowing capacity until early August
2011.8 That letter, the third sent by the Treasury Secretary since January 2011, noted that funding
federal operations could soon become complicated without a debt limit increase. Certain
measures that rely on the Treasury Secretary’s existing authority, such as the draw-down of the
Supplementary Financing Program, are under way. New issues of State and Local Government
1 Approximately 0.5% of total debt is excluded from debt limit coverage. The Treasury defines “Total Public Debt
Subject to Limit” as “the Total Public Debt Outstanding less Unamortized Discount on Treasury Bills and Zero-
Coupon Treasury Bonds, old debt issued prior to 1917, and old currency called United States Notes, as well as Debt
held by the Federal Financing Bank and Guaranteed Debt.” For details, see http://www.treasurydirect.gov. The debt
limit is codified as 31 USC 3101.
2 Although there are hundreds of trust funds, the overwhelming majority are very small. The 12 largest trust funds hold
98.8% of the federal debt held in government accounts.
3 Other means of financing—including cash balance changes, seigniorage, and capitalization of financing accounts used
to fund federal credit programs—have relatively little effect on the changes in debt held by the public.
4 In future years, when some trust funds are projected to pay out more than they take in, funds that the Treasury would
use to redeem those intergovernmental debts must be obtained via higher taxes or lower government spending.
5 Trust fund surpluses by law must be invested in special federal government securities.
6 Daily data on federal debt can be obtained at the Treasury Department’s Bureau of the Public Debt website:
http://www.treasurydirect.gov/NP/BPDLogin?application=np. Data on debt subject to limit are provided in the Daily
Treasury Statement, available at http://fms.treas.gov/dts/index.html.
7 Wrightson ICAP, The Money Market Observer, May 2, 2011.
8 Secretary of the U.S. Treasury Timothy Geithner, letter to Speaker John Boehner, dated May 2, 2011, available
http://www.treasury.gov/connect/blog/Documents/FINAL%20Debt%20Limit%20Letter%2005-02-
2011%20Boehner.pdf. The same text was sent to all Members.
Congressional Research Service
1
The Debt Limit: History and Recent Increases
Series (SLGS) Treasury securities, according to the May 2 letter, are scheduled for suspension on
May 6, 2011. These measures are discussed in more detail in the next section.
On January 6, 2011, Treasury Secretary Geithner sent a letter to Senate Majority Leader Harry
Reid requesting an increase in the debt limit. At that time, Secretary Geithner stated that federal
debt would likely reach its statutory limit between March 31 and May 16, 2011.9 On April 4, the
Treasury Secretary wrote Congress that estimates indicated that federal debt would reach its limit
between April 15 and May 31, 2011.10 The U.S. Treasury had also previously projected that its
borrowing capacity, even using extraordinary measures, would be exhausted about July 8, 2011.11
Some Wall Street analysts have been expecting federal debt to near its limit in that time frame,
although the economic recovery, through its effects on tax revenues, has affected federal debt
trends.12 Without a debt limit increase, the U.S. Treasury may face difficulty in funding federal
operations after the middle of 2011.
The U.S. Treasury has taken steps to draw down the Supplementary Financing Program (SFP), an
initiative intended to help manage monetary policy, from $200 billion to $5 billion, which
provides some additional headroom under the limit.13 Given the size of the FY2011 federal
deficit, estimated at $1,399 billion by the Congressional Budget Office (CBO) in April 2011, that
additional headroom may not provide substantial additional time before the debt limit nears.14
Slowing the growth in federal debt by cutting spending has been suggested by some
commentators as a means of avoiding an increase in the debt limit. The scale of spending
reductions that would be required would likely approximately equal total discretionary spending
for the last five months of FY2011. FY2011 ends on September 30, 2011.15
The Debt Limit and the Treasury
Standard methods of financing federal activities or meeting government obligations used by the
U.S. Department of Treasury (Treasury) can be hobbled when federal debt nears its legal limit.
The government’s income and outlays vary over the course of the year, producing monthly
surpluses and deficits that affect the level of debt, whether or not the government has a surplus or
deficit for the entire year. Even major government trust fund accounts that usually run annual
surpluses also can swing back and forth between deficits and surpluses on a month-to-month
basis. The ability to borrow is central to Treasury cash management systems that handle
9 Paul M. Krawzak, “Showdown Ahead on Debt Limit as Geithner Urges Action,” CQ Today Online News, January 6,
2011; Secretary of the U.S. Treasury Timothy Geithner, letter to Majority Leader Harry Reid, dated January 6, 2011.
10 U.S. Treasury, “Treasury Issues Updated Debt Limit Projections,” March 1, 2011, available at
http://www.treasury.gov/press-center/press-releases/Pages/tg1084.aspx.
11 Secretary of the U.S. Treasury Timothy Geithner, letter to Majority Leader Harry Reid, dated April 4, 2011, available
at http://www.treasury.gov/connect/blog/Documents/FINAL%20Letter%2004-04-
2011%20Reid%20Debt%20Limit.pdf.
12 Wrightson ICAP, The Money Market Observer, December 13, 2010.
13 U.S. Treasury, “Treasury Announces Marketable Borrowing Estimates,” press release TG-1038, January 31, 2011,
available at http://www.treasury.gov/press-center/press-releases/Pages/tg1038.aspx.
14 U.S. Congressional Budget Office, “An Analysis of the President’s Budgetary Proposals for Fiscal Year 2012,” April
15, 2011, available at http://www.cbo.gov/doc.cfm?index=12130.
15 For details, see CRS Report R41633, Reaching the Debt Limit: Background and Potential Effects on Government
Operations, coordinated by Mindy R. Levit.
Congressional Research Service
2
The Debt Limit: History and Recent Increases
fluctuations in federal revenues and outlays. When federal debt has neared the debt limit in the
past, limiting the U.S. Treasury’s borrowing authority, financial management has become more
complicated.
If the U.S. Treasury were precluded from borrowing due to a binding debt limit in times when
federal outlays outpaced revenues, the government would no longer meet all of its legal
obligations in a timely manner.16 If the limit prevents the Treasury from issuing new debt to
manage short-term cash flows or to finance an annual deficit, the government may be unable to
obtain the cash needed to pay its bills or it may be unable to invest the surpluses of designated
government accounts (federal trust funds) in federal debt as generally required by law. In either
case, the Treasury is left in a bind; the law requires that the government’s legal obligations be
paid, but the debt limit may prevent it from issuing the debt that would allow it to do so on time.
Among other consequences, a sustained inability to pay obligations on time could hinder the U.S.
Treasury’s ability to borrow on advantageous terms in the future. The Government Accountability
Office has also concluded that delays in debt limit increases could lead to “serious negative
consequences for the Treasury market and increase borrowing costs.”17 A delay in interest
payments on Treasury securities would trigger a default and risk serious negative repercussions
for economies and financial markets around the world. Default might be avoided in such
situations by delaying other types of federal payments and transfers. A government that delays
payment of an obligation, in effect, borrows from vendors, contractors, beneficiaries, state and
local governments, or employees who are not paid on time. In some cases, delaying payments
incurs interest penalties under some statutes such as the Prompt Payment Act, which directs the
government to pay interest penalties to contractors if it does not pay them by the required
payment date,18 and the Internal Revenue Code, which requires the government to pay interest
penalties if tax refunds are delayed beyond a certain date.19
Past Treasury Secretaries, when faced with a nearly binding debt ceiling, have used special
strategies to handle cash and debt management responsibilities. Actions taken in the past include
suspending sales of nonmarketable debt, postponing or downsizing marketable debt auctions, and
withholding receipts that would be transferred to certain government trust funds. Congress has
authorized the Treasury Secretary to invoke a “debt issuance suspension period” to use some of
these strategies using the Civil Service Retirement Fund and the Thrift Savings Fund, along with
the authority to make those funds whole after an easing of the debt constraint.20
16 See CRS Report R41633, Reaching the Debt Limit: Background and Potential Effects on Government Operations,
coordinated by Mindy R. Levit.
17 Government Accountability Office, Debt Limit: Delays Create Debt Management Challenges and Increase
Uncertainty in the Treasury Market, GAO-11-203, February 22, 2011.
18 31 U.S.C. §3902.
19 26 U.S.C. §6611.
20 For details, see archived CRS Report 95-1109, Authority to Tap Trust Funds and Establish Payment Priorities if the
Debt Limit is not Increased, by Thomas J. Nicola and Morton Rosenberg. Available upon request from authors. 5
U.S.C. Sec. 8348(b) defines a debt issuance suspension period as “any period for which the Secretary of the Treasury
determines for purposes of this subsection that the issuance of obligations of the United States may not be made
without exceeding the public debt limit.” After a debt issuance suspension period ends, the Treasury Secretary must
report to Congress as soon as possible regarding fund balances and any extraordinary actions taken. For details, see 5
USC Sec. 8348(j,k).
Congressional Research Service
3
The Debt Limit: History and Recent Increases
Some U.S. Treasury responses to the credit crunch that began in mid-2007 created balance sheet
items that have expanded options available to the Treasury Secretary, although such options
would have minor effects on delaying when federal debt would reach its legal limit. The U.S.
Treasury began selling off certain mortgage-backed securities (MBSs) acquired in late 2008.21
The pace of those sales was targeted at $10 billion per month in order to minimize any market
disruptions in the mortgage securities market, and thus is unlikely to affect the timing of when the
U.S. Treasury will reach the debt limit significantly. By the end of April 2011, the U.S. Treasury
had sold $121 billion of its $225 billion portfolio of MBSs.22 Even with proceeds of these or other
potential asset sales however, the U.S. Treasury is unlikely to maintain smooth debt management
operations indefinitely in the face of a continuing imbalance between federal revenues and
outlays without an increase in the debt limit.
Why Have a Debt Limit?
The debt limit can hinder the Treasury’s ability to manage the federal government’s finances, as
noted above. In extreme cases, when the federal debt is very near its statutory limit, the Treasury
must take unusual and extraordinary measures to meet federal obligations.23 While the debt limit
has never caused the federal government to default on its obligations, it has at times caused great
inconvenience and has added uncertainty to Treasury operations.
The debt limit also provides Congress with the strings to control the federal purse, allowing
Congress to assert its constitutional prerogatives to control spending.24 The debt limit also
imposes a form of fiscal accountability that compels Congress and the President to take visible
action to allow further federal borrowing when the federal government spends more than it
collects in revenues. In the words of one author, the debt limit “expresses a national devotion to
the idea of thrift and to economical management of the fiscal affairs of the government.”25 On the
other hand, some budget experts have advocated elimination of the debt limit, arguing that other
controls provided by the modern congressional budget process established in 1974 have
superseded the debt limit, and that the limit does little to alter spending and revenue policies that
determine the size of the federal deficit.26
21 U.S. Treasury, “Treasury to Begin Orderly Wind Down of Its $142 Billion Mortgage-Backed Securities Portfolio,”
press release, March 21, 2011, available at http://www.treasury.gov/press-center/press-releases/Pages/tg1111.aspx.
22 Mary J. Miller, “MBS Wind Down Update—Taxpayers Have Now Recovered More than Half of Treasury’s Original
Investment,” U.S. Treasury, Treasury Notes, May 2, 2011, available at http://www.treasury.gov/connect/blog/Pages/
MBS-Wind-Down-Update-Taxpayers-Have-Now-Recovered-More-than-Half-of-Treasurys-Original-Investment.aspx.
23 U.S. General Accounting Office (GAO), Analysis of Actions Taken during the 2003 Debt Issuance Suspension
Period, GAO-04-526, May 2004, available at http://www.gao.gov/new.items/d04526.pdf.
24 For a vigorous assertion of the utility of the debt ceiling, see Anita S. Drishnakumar, “In Defense of the Debt Limit
Statute,” Harvard Journal on Legislation, vol. 42, 2005, pp. 135-185.
25 Marshall A. Robinson, The National Debt Ceiling: An Experiment in Fiscal Policy, Washington, DC: The Brookings
Institution, 1959, p. 5.
26 Bruce Bartlett, “Why Congress Must Now Abolish its Debt Limit,” Financial Times, October 22, 2009, p. 11.
Congressional Research Service
4
The Debt Limit: History and Recent Increases
A Brief History of the Federal Debt Limit
Origins of the Federal Debt Limit
The statutory limit on federal debt began with the Second Liberty Bond Act of 1917,27 which
helped finance the United States’ entry into World War I.28 By allowing the Treasury to issue
long-term Liberty Bonds, which were marketed to the public at large, the federal government held
down its interest costs.29
Before World War I, Congress often authorized specific loans, such as the Panama Canal loan, or
allowed the Treasury to issue specific types of debt instruments, such as certificates of
indebtedness, bills, notes, and bonds.30 In other cases, especially in time of war, Congress
provided the Treasury with discretion, subject to broad limits, to choose debt instruments.31 For
example, the 1898 War Revenue Act (30 Stat. 448-470) that funded Spanish-American War costs
granted the Treasury Secretary the authority to issue $100 million in certificates of indebtedness
with maturities under a year and $400 million in longer-term notes and bonds.32 Proponents of the
act made clear their intention to allow the Treasury Secretary substantial administrative leeway.33
With the passage of the Second Liberty Bond Act, Congress enacted aggregate constraints on
certificates of indebtedness and on bonds that allowed the Treasury greater ability to respond to
changing conditions and more flexibility in financial management. Debt limit legislation in the
following two decades also set separate limits for different categories of debt, such as bills,
certificates, and bonds.
In 1939, Congress eliminated separate limits on bonds and on other types of debt, which created
the first aggregate limit that covered nearly all public debt.34 This measure gave the Treasury freer
rein to manage the federal debt as it saw fit. Thus, the Treasury could issue debt instruments with
maturities that would reduce interest costs and minimize financial risks stemming from future
27 P.L. 65-43, 40 Stat. 288, enacted September 24, 1917. Currently codified as amended as 31 U.S.C. § 3101.
28 H. J. Cooke and M. Katzen, “The Public Debt Limit,” Journal of Finance, vol. 9, no. 3 (September 1954), pp. 298-
303.
29 Robert D. Hormats, The Price of Liberty, (New York: Henry Holt, 2007), ch. 4.
30 Treasury certificates of indebtedness were short-term, interest-bearing securities. Treasury bills are securities with a
maturity of a year or less. Treasury notes are interest-bearing securities that generally have maturities of two to five
years. Treasury bonds are interest-bearing securities that generally have maturities of 10 or more years.
31 Marshall A. Robinson, The National Debt Ceiling: An Experiment in Fiscal Policy, (Washington, DC: The
Brookings Institution, 1959), pp.1-6.
32 The War Revenue Act, formally “An Act to Provide Ways and Means to Meet War Expenditures and for Other
Purposes,” was enacted June 13, 1898. Much of the legislative text of the Act’s public borrowing sections (§32, 33)
were drawn from the Acts of June 30, 1864, ch. 172, §1 (13 Stats. 218) and of March 3, 1865, ch. 77 (13 Stats. 469).
33 Some opponents raised concerns that granting the Treasury Secretary authority to issue debt could affect monetary
policies, which might tighten credit conditions. Such concerns became less relevant after the establishment of the
Federal Reserve System in 1913. See House debate, Congressional Record, vol. 31, part 6 (June 9, 1898), pp. 5713-
5728; and Senate debate on June 10, 1898, pp. 5734-5749.
34 P.L. 76-201. Some authors claimed the aggregate limit was first created in Public Debt Act of 1941 (P.L. 77-7). The
1939 Senate floor debate, however, makes clear that Congress intended to lift categorical debt restrictions. See Senate
debate, Congressional Record, vol. 84, part 6 (June 1, 1939), pp. 6480, 6497-6501.
Congressional Research Service
5
The Debt Limit: History and Recent Increases
interest rate changes.35 On the other hand, although the Treasury was delegated greater
independence of action, the debt limit on the eve of World War II was much closer to total federal
debt than it had been at the end of World War I. For example, the 1919 Victory Liberty Bond Act
(P.L. 65-328) raised the maximum allowable federal debt to $43 billion, far above the $25.5
billion in total federal debt at the end of FY1919.36 By contrast, the debt limit in 1939 was $45
billion, only about 10% above the $40.4 billion total federal debt of that time.
World War II and After
The debt ceiling was raised to accommodate accumulating costs for World War II in each year
from 1941 through 1945, when it was set at $300 billion.37 After World War II ended, the debt
limit was reduced to $275 billion. Because the Korean War was mostly financed by higher taxes
rather than by increased debt, the limit remained at $275 billion until 1954. After 1954, the debt
limit was reduced twice and increased seven times, until March 1962 when it again reached $300
billion, its level at the end of World War II. Since March 1962, Congress has enacted 74 separate
measures that have altered the limit on federal debt.38 Most of these changes in the debt limit
were, measured in percentage terms, small in comparison to changes adopted in wartime or
during the Great Depression. Some recent increases in the debt limit, however, were large in
dollar terms. For instance, in May 2003, the debt limit increased by $984 billion.
The Debt Ceiling in the Last Decade
During the four years (FY1998-FY2001) the government ran surpluses, federal debt held by
intergovernmental accounts grew by $855 billion and debt held by the public fell by almost $450
billion. Since FY2001, however, debt held by the public has grown due to persistent and
substantial budget deficits. Debt held in government accounts also has grown, in large part
because Social Security payroll taxes have exceeded payments of beneficiaries.
35 This limit did not apply to certain previous public debt issues that constituted a minor portion of the federal debt.
36U.S. Bureau of the Census, Historical Statistics of the United States: Colonial Times to 1970, H. Doc. 93-78
(Washington: GPO, 1975), Series Y 493-504.
37 Public Debt Acts of 1941 (P.L. 77-7), 1942 (P.L. 77-510), 1943 (78-34), 1944 (P.L. 78-333), and 1945 (P.L. 79-48).
38 U.S. Office of Management and Budget, FY2010 Budget of the U.S. Government: Historical Tables, Table 7-3.
Congressional Research Service
6
The Debt Limit: History and Recent Increases
Table 1 shows components of debt in current dollars and as percentages of gross domestic
product (GDP).39
Figure 1 shows the components of federal debt as shares of gross domestic product (GDP) from
FY1940 through FY2010.40 Federal debt held by government accounts has grown steadily since
1980. Debt held by the public, which changes in response to total surpluses or deficits, grew as a
share of GDP through the mid-1990s. After FY1992, deficits shrank, and from FY1998 through
FY2001 the federal government ran surpluses.41 Those surpluses, along with rapid GDP growth,
reduced debt held by the public as a percentage of GDP. When large deficits returned and GDP
growth slowed in the early 2000s, debt held by the public as a share of GDP again increased.
Smaller deficits in FY2006 and FY2007 led to smaller increases in publicly held debt. The total
FY2007 deficit fell to 1.2% of GDP according to CBO.42 Financial turmoil in 2007 and 2008 and
a subsequent recession that began in late 2007 led to federal actions taken to stabilize the housing
and financial markets. The recession reduced federal revenues and increased federal spending,
leading to large deficits and a series of debt limit increases.
39 Until 2001, Treasury publications did not divide debt subject to limit by that held by the public and that held by
government accounts.
Table 1 uses CRS calculations that approximate levels of debt subject to limit held in these two categories for fiscal
years prior to 2001.
40 The data show components of debt compared to the size of the economy. This avoids possible distortions resulting
from changing price levels over time and includes changes in per capita incomes. This percentage increases when debt
grows faster than GDP and falls when it grows more slowly than GDP.
41Federal on-budget receipts and outlays nearly matched in FY1999, and the on-budget surplus in FY2000 was 0.9% of
GDP. Prior to FY1999, the federal government last had an on-budget surplus in FY1960. Social Security receipts in
excess of benefits make up most of the off-budget surplus, which has been positive since FY1985.
42 U.S. Congress, Congressional Budget Office, An Analysis of the President’s Budgetary Proposals for Fiscal Year
2009, March 2008, available at http://www.cbo.gov/ftpdocs/89xx/doc8990/03-19-AnalPresBudget.pdf.
Congressional Research Service
7
The Debt Limit: History and Recent Increases
Table 1. Components of Debt Subject to Limit, FY1996-FY2010
(in billions of current dollars and as percentage of GDP)
Debt Subject to Limit
Held by Government
Total
Accounts
Held by the Public
End of Fiscal
Debt
Year
Limit
$ Billion % of GDP
$ Billion
% of GDP
$ Billion
% of GDP
1996
$5,500
$5,137.2
65.7%
1,432.4
18.3%
3,704.8
47.4%
1997
5,950
5,327.6
64.2
1,581.9
19.0
3,745.8
45.1
1998
5,950
5,439.4
62.2
1,742.1
19.9
3,697.4
42.3
1999
5,950
5,567.7
60.1
1,958.2
21.1
3,609.5
38.9
2000
5,950
5,591.6
57.0
2,203.9
22.4
3,387.7
34.5
2001
5,950
5,732.8
56.6
2,436.5
24.1
3,296.3
32.5
2002
6,400
6,161.4
58.9
2,644.2
25.3
3,517.2
33.6
2003
7,384
6,737.6
61.4
2,846.7
25.9
3,890.8
35.5
2004
7,384
7,333.4
62.5
3,056.6
26.0
4,276.8
36.4
2005
8,184
7,871.0
64.0
3,301.0
26.9
4,570.1
37.2
2006
8,965
8,420.3
64.2
3,610.4
27.5
4,809.8
36.7
2007
9,815a
8,921.3
65.4
3,903.7
28.6
5,017.6
36.8
2008
10,615b
9,960.0
70.0
4,180.0
29.4
5,780.3
40.6
2009
12,104c
11,909.8
84.1
4,358.0
30.8
7,551.9
53.3
2010
14,294d
13,510.8
92.1
4,585.7
31.3
9,022.8
61.5
Change during
FY1998 - FY2001
$405.2 $854.6 $-449.5
Change during
FY2002 - FY2010
$7,778.0 $2,073.1 $5,704.9
Source: U.S. Department of the Treasury, Financial Management Service, Treasury Bul etin, June 2001 and
December 2006. Bureau of the Public Debt, Monthly Statement of Public Debt, various issues. CRS calculations.
Notes: For the fiscal years 1996 through 2000, the amounts held by government accounts and held by the public
are approximations. In 2001, the Treasury publications began distinguishing holders of debt subject to limit. The
numbers in the table showing this breakdown for FY1996 through FY2000 were calculated by subtracting debts
of the Federal Financing Bank, an arm of the Treasury whose debt is not subject to limit, from total debt held by
government accounts. This calculation approximates the amount of that debt subject to limit. This approximation
overestimates debt by billions of dollars because estimates of unamortized discount are unavailable. This adjusted
amount was then subtracted from total debt subject to limit to produce an approximate measure of debt held by
the public subject to limit. Because the amount held by government accounts is overestimated, the resulting
measure of debt held by the public subject to limit is underestimated. Totals may not sum due to rounding.
a. Debt limit increased September 29, 2007, to $9,815 billion.
b. The debt limit was increased twice in 2008—to $10,615 billion on July 30 and then to $11,315 billion on
October 3, at the start of FY2009.
c. Debt limit was increased February 17, 2009, to $12,104 billion.
d. Debt limit was increased February 12, 2010, to $14,294 billion.
Congressional Research Service
8
Figure 1. Components of Federal Debt As a Percentage of GDP, FY1940-FY2009
Source: OMB, Budget of the United States for FY2010, Historical Tables, February 2009; Mid-Session Review, August 2009.
CRS-9
The Debt Limit: History and Recent Increases
The Debt Limit Issue in 2002
Accumulating debt in government accounts produced most of the pressure on the debt limit that
occurred early in 2002. As deficits reemerged in FY2002, increases in debt held by the public
added to the pressure on the debt limit in the spring of 2002. During the four fiscal years with
surpluses (FY1998-FY2001), the increases in federally held debt and decreases in debt held by
the public produced a net increase of $405 billion in total debt subject to limit. At the beginning
of FY2002 (October 1, 2001), debt subject to limit was within $217 billion of the existing $5,950
billion debt limit.43 Between then and the end of May 2002, debt subject to limit increased by
another $217 billion, divided between a $117 billion increase in debt held by government
accounts and a $100 billion increase in debt held by the public, putting the debt close to the
$5,950 billion limit. Table A-1, presented in the Appendix, shows month-by-month debt totals
and accumulations from September 2001 through December 2010.
In the fall of 2001, the Administration recognized that a deteriorating budget outlook and
continued growth in debt held by government accounts were likely to lead to the debt limit soon
being reached. In early December 2001, it asked Congress to raise the debt limit by $750 billion
to $6,700 billion. As the debt moved closer to and reached the debt limit over the first six months
of FY2002, the Administration asked Congress repeatedly to increase the debt limit, warning of
adverse financial consequences were the limit not raised.
On April 4, 2002, the Treasury held debt below the limit by invoking its legislatively mandated
authority to suspend reinvestment of government securities in the G-Fund of the federal
employees’ Thrift Savings Plan (TSP). This allowed the Treasury to issue new debt and meet the
government’s obligations. On April 15, debt subject to limit stood at $5,949,975 million, just $25
million below the limit. Once April 15 tax revenues flowed in, the Treasury “made whole” the G-
Fund by restoring all of the debt that had not been issued to the TSP over this period and crediting
the fund with interest it would have earned on that debt.44 By the end of April, debt subject to
limit had fallen back $35 billion below the limit.
Resolving the Debt Limit Issue in 2002
By the middle of May 2002, debt subject to limit had again risen to within $15 million of the
statutory limit. At the FY2002 average spending rate, $15 million equaled about five minutes of
federal outlays. The Treasury, for the second time in 2002, used its statutory authority to avoid a
default. The Treasury’s financing problems, however, would persist without an increase in the
debt limit. On May 14, the Treasury asked Congress to raise the debt limit or enact other statutory
changes allowing the Treasury to issue new debt. A Treasury news release stated “absent
extraordinary actions, the government will exceed the statutory debt ceiling no later than May
16,” and that
43 The debt limit was raised from $5,500 billion to $5,950 billion on August 5, 1997, as part of the Balanced Budget
Act of 1997 (P.L. 105-33, 111 Stat. 251).
44 For a comprehensive discussion of the Treasury’s previous uses of its short-term ability to avoid breaching the debt
limit, see U.S. General Accounting Office, Debt Ceiling: Analysis of Actions During the 1995-1996 Crisis,
GAO/AIMD-96-130, August 1996.
Congressional Research Service
10
The Debt Limit: History and Recent Increases
a “debt issuance suspension period” will begin no later than May 16 [2002].... [This] allows
the Treasury to suspend or redeem investments in two trust funds, which will provide
flexibility to fund the operations of the government during this period.45
The Treasury reduced federal debt held by these government accounts by replacing it with non-
interest-bearing, non-debt instruments, which enabled it to issue new debt to meet the
government’s obligations. The Treasury claimed these extraordinary actions would suffice, at the
latest, through June 28, 2002. Without a debt limit increase by that date, the Treasury indicated it
would need to take other actions to avoid breaching the ceiling. By June 21, the Treasury had
postponed a regular securities auction, but took no other actions. With large payments and other
obligations due at the end of June and at the beginning of July, the Treasury stated it would soon
exhaust all options to issue debt and fulfill government obligations, putting the government on the
verge of a default.
During May and June 2002, Congress took steps to increase the debt limit. The FY2002
supplemental appropriations bill (H.R. 4775) passed by the House on May 24 included, after
extended debate, language allowing any eventual House-Senate conference on the legislation to
increase the debt limit. However, the Senate’s supplemental appropriations bill (S. 2551;
incorporated as an amendment to H.R. 4775, June 3, 2002) omitted debt-limit-increasing
language. The Senate leadership expressed strong reluctance to include a debt limit increase in the
supplemental appropriation bill. Instead, on June 11, the Senate adopted a bill (S. 2578), without
debate, to raise the debt limit by $450 billion to $6,400 billion. At that time, a $450 billion debt
limit increase was thought to provide enough borrowing authority for government operations
through the rest of calendar year 2002, if not through the summer of 2003. With the possibility of
default looming over it, the House passed the $450 billion debt limit increase by a single vote on
June 27. The President signed the bill into law on June 28 (P.L. 107-199, 116 Stat. 734), ending
the 2002 debt limit crisis.46
The Debt Limit Issue in 2003
On Christmas Eve, 2002, Kenneth Dam, Deputy Secretary of the Treasury, sent a letter to
Congress requesting an unspecified increase in the debt limit by late February 2003, signaling
that the $6,400 billion debt limit would then be reached.47 The 108th Congress, still in the process
of organizing itself, did not immediately respond. Through the winter and into the spring, the
Treasury repeatedly requested that the debt limit be raised to avoid serious financial problems. By
February 20, 2003, the Treasury, as in 2002, used legislatively mandated measures to manage
debt holdings of certain government accounts to avoid reaching the debt limit. These actions
included the replacement of internally held government debt with non-debt instruments in certain
government accounts and not issuing new debt to these accounts. These actions allowed the
Treasury to issue additional debt to the public to acquire the cash needed to pay for the
government’s commitments or to issue new debt to other federal accounts.
45 U.S. Department of the Treasury, Treasury News, Treasury Statement on the Debt Ceiling, May 14, 2002.
46 For additional details, see U.S. General Accounting Office, Debt Ceiling: Analysis of Actions During the 2002 Debt
Issuance Suspension Period, GAO-03-134, December 2002.
47 Kenneth Dam, Deputy Secretary of the Treasury, letter to Speaker of the House, Dennis Hastert, December 24, 2002,
available at http://www.treas.gov/press/releases/po3718.htm.
Congressional Research Service
11
The Debt Limit: History and Recent Increases
Through the rest of February and into May, the Treasury held debt subject to limit $15 million
below the debt ceiling.48 The adoption of the conference report on the FY2004 budget resolution
(H.Con.Res. 95; H.Rept. 108-71) on April 11, 2003, in the House triggered the “Gephardt rule”
(House Rule XXVII) that deems to have passed legislation (in this case, H.J.Res. 51) raising the
debt limit to accommodate the spending and revenue levels approved in the adopted budget
resolution.49
The Senate received the debt-limit legislation on April 11, but did not act until May 23, after
receiving further Treasury warnings of imminent default. On that day, debt subject to limit was
$25 million (or 0.0004%) below the existing $6,400 billion limit. The Senate adopted the
legislation, after rejecting eight amendments and sent it to the President, who signed it on May
27. This legislation raised the debt limit to $7,384 billion (P.L. 108-24, 117 Stat. 710).
The Debt Limit Issue in 2004
In January 2004, CBO estimated that the debt limit, then set at $7,384 billion, would be reached
the following summer.50 In June 2004, the Treasury asked Congress to raise the debt limit in order
to avoid the disruptions to government finances experienced in the previous two years.51 In
August, and again in September, the Treasury declared that the debt limit would be reached in the
first half of October. On October 14, debt subject to limit reached $7,383,975 million, just $25
million below the existing limit. The Treasury employed methods used in the previous two years
to keep debt under the legal limit. On October 14, Secretary of the Treasury John Snow informed
Congress, just before the election recess, that available measures to avoid breaching the debt limit
would be exhausted by mid-November.52 Without an increase in the debt limit, the Treasury
would be unable to meet all of the government’s existing obligations, which could undermine the
U.S. government’s reputation in capital markets and raise costs of federal borrowing.
Although the House passed a budget resolution for FY2005 in the spring of 2004, it did not reach
final agreement with the Senate on the measure. Without a budget resolution passed by Congress,
no resolution to raise the debt limit could be deemed passed by the House automatically under the
Gephardt rule. Consequently, no measure was available to send to the Senate. As the debt
approached the limit through the summer and into the fall, no legislation was moved to raise the
debt limit.
Earlier, in September 2004, the House had added an amendment to the FY2005 Transportation-
Treasury appropriations (H.R. 5025) in an effort to remove the Treasury’s flexibility in financing
the government as federal debt approached and reached the existing limit. Without that flexibility,
48 The Treasury reduced the amount of debt held by selected federal accounts while it sold an equal (or smaller) amount
of debt to the public. This raised cash needed to pay for ongoing obligations and kept the debt below the limit.
49 The House Budget Committee has some discretion in setting the debt limit level in the House Joint resolution
generated by the Gephardt rule. See CRS Report 98-453, Debt-Limit Legislation in the Congressional Budget Process,
by Bill Heniff Jr. and CRS Report RL31913, Developing Debt-Limit Legislation: The House’s “Gephardt Rule”, by
Bill Heniff Jr..
50 U.S. Congress, Congressional Budget Office, The Budget and Economic Outlook: Fiscal Years 2005 to 2014,
January 2004.
51 Alan Fram, “Congress May Duck Debt Limit Raise,” Oakland Tribune, June 5, 2004.
52 John W. Snow, Secretary of the U.S. Treasury, letter to Senate Majority Leader Bill Frist, October 14, 2004,
available at http://www.treas.gov/press/releases/reports/frist.pdf.
Congressional Research Service
12
The Debt Limit: History and Recent Increases
the government would be unable to meet its financial obligations as the amount of debt neared the
limit. The legislation cleared the House, but the Senate did not act on it.
After the elections, Senator Frist, on November 16, 2004, introduced legislation (S. 2986) to raise
the debt limit by $800 billion, from $7,384 billion to $8,184 billion. The Senate approved the
increase on November 17, 2004. The House considered and approved the increase on November
18. The President signed the legislation into law (P.L. 108-415, 118 Stat. 2337) on November 19,
2004. Estimates made at that time anticipated the new limit would be reached between August
and December 2005.
Shortly before the increase in the debt limit, the Treasury delayed a debt auction and informed
Congress that it would invoke a “debt limit suspension period” as it had in previous years. The
increase in the debt limit in mid-November allowed the Treasury to reschedule the debt auction
and cancel, before it began, the “debt limit suspension period.”
The Debt Limit Issue in 2005, 2006, and 2007
Debt limit increases in 2005, 2006, and 2007 took a less dramatic path than those in President
Bush’s first term. In 2005, Congress included three reconciliation instructions in the FY2006
budget resolution (H.Con.Res. 95, 109th Congress; April 28, 2005), the third of which directed the
House Committee on Ways and Means and the Senate Finance Committee to report bills raising
the debt limit. The instructions specified a $781 billion debt limit increase, to $8,965 billion, with
a reporting date of no later than September 30, 2005. Neither committee reported a bill to raise
the debt limit.
The adoption of the conference report on the FY2006 budget resolution in late April 2005 also
triggered the Gephardt rule (House Rule XXVII), producing a House Joint Resolution (H.J.Res.
47) that also would raise the debt limit by $781 billion to $8,965 billion. Under the rule, the
resolution was automatically deemed passed by the House and sent to the Senate. Through the
end of the first session of the 109th Congress, the Senate had not considered H.J.Res. 47, nor had
Congress considered a reconciliation bill raising the debt limit as called for in the budget
resolution.
At the end of December 2005, Secretary of the Treasury Snow wrote Congress that the debt limit
would probably be reached in mid-February 2006, although the Treasury could take actions that
maintain the debt below its limit until mid-March. He therefore requested an increase in the debt
limit.53 In two more letters, sent on February 19 and March 6, Secretary Snow advised Congress
that the Treasury was taking measures within its legal discretion to avoid reaching the limit and
that these measures would suffice only until the middle of March 2006. Secretary Snow
authorized actions used previously by the Treasury, including declaring a debt issuance
suspension period. As March began, the government was again close to becoming unable to meet
its obligations. During the week of March 13 the Senate took up H.J.Res. 47. On March 16, the
Senate passed a debt limit increase after rejecting several amendments. The President’s signature
on March 20, 2006, then raised the debt limit (P.L. 109-182) to $8,965 billion.
53 John W. Snow, Secretary of the Treasury, letter to Senator Max Baucus, December 29, 2005, available at
http://www.ombwatch.org/files/budget/pdf/snow_debtlimit_2006.pdf.
Congressional Research Service
13
The Debt Limit: History and Recent Increases
In mid-May 2007, Congress passed the conference report (H.Rept. 110-153) on the FY2008
budget resolution. The House’s Gephardt rule, triggered by the adoption of the conference report
on the budget resolution, resulted in the automatic engrossment of a joint resolution (in this case,
H.J.Res. 43, 110th Congress) raising the debt limit by $850 billion to $9,815 billion, and sending
it to the Senate. At the end of July 2007, the Treasury asked Congress to raise the debt limit,
stating the limit would be reached in early October 2007. In August, the CBO Director said that
projections suggested that the limit would be reached in late October or early November. Without
an increase, the Treasury indicated that it would take steps within its legal authority to avoid
exceeding the debt limit. The Senate Finance Committee approved the House resolution (H.J.Res.
43) without changes on September 12, 2007. The Senate then passed the measure on September
27, which the President signed on September 29, 2007 (P.L. 110-91).
The Economic Slowdown and Federal Debt
Fiscal Policy Considerations
The U.S. economy is currently recovering slowly from a severe economic recession that began in
December 2007 and ended in June 2009.54 The economic slowdown began with a rapid
deceleration of housing prices and a rise in interest rate spreads between private lending rates and
benchmark Federal Reserve rates, indicating an increasing reluctance of major financial
institutions to lend to each other as well as to firms and individuals. This led to sharply higher
federal deficit spending in FY2008 spurred by several major actions taken by Congress to
unfreeze credit markets, boost consumption, and increase spending. Deficit spending was even
higher in FY2009, with higher than average deficits as a percentage of GDP persisting into the
next decade, likely leading to further increases in the federal debt and debt limit. While deficits
for FY2010 were slightly lower and fiscal conditions are projected to improve in FY2011, deficits
remain high relative to historical experience.
Economic recession affects the federal deficit in several ways. First, falling prices of many assets
and equities can sharply reduce federal revenues from capital gains taxes and from the corporate
tax. Second, individual income taxes, the largest component of federal revenues, may also fall if
jobs are cut and unemployment increases due to economic conditions. Third, “automatic
stabilizers” such as unemployment insurance and income support programs pay out more money
as unemployment rises and the number of households eligible for means-tested benefits rises, thus
increasing federal spending.
Boosting the economy through deficit spending provides a fiscal stimulus if the output levels of
goods and services produced in the nation are below their potential levels. Deficit spending,
however, can help accelerate inflation if output levels are near or at potential levels, and in
addition, exacerbates long-term fiscal challenges. Several economists have expressed concerns
that inflation, which had been relatively low since the early 1980s, could accelerate due to rising
prices of food, energy, and primary commodities. While inflation would reduce the market value
of the federal deficit, it would require Treasury to pay higher nominal interest rates on federal
54 The end of a recession is said to occur when an economy has stopped shrinking, not when it has recovered. See
National Bureau of Economic Research Business Cycle Dating Committee, press release, September 20, 2010,
available at http://www.nber.org/cycles/sept2010.html.
Congressional Research Service
14
The Debt Limit: History and Recent Increases
debt. The U.S. economy, however, is currently operating well below its potential, which has kept
inflation at lower levels.
Raising the Debt Ceiling in 2008, 2009, and 2010
In a March 2008 report, CBO estimated the President’s budget would lead to a $396 billion
deficit in FY2008 and a $342 billion deficit in FY2009.55 The actual deficit for FY2008 reached
$455 billion. In August 2009, CBO estimated the deficit would total $1,587 billion in FY2009
and $1,381 billion in FY2010.56 As a result of the current economic conditions and the actions of
the federal government to bring the economy out of recession, the federal debt limit was raised
twice in the second half of 2008 and twice in 2009.
The House Concurrent Resolution on the Budget (H.Con.Res. 312) recommended policies that
would result in a $10,200 billion debt in FY2009. The Senate Concurrent Resolution on the
Budget S.Con.Res. 70) recommended policies that would result in a total debt of $10,278 billion
in FY2009.57 Implementing either set of policies would require an increase in the federal debt
limit. The conference agreement (H.Rept. 110-659) also recommended spending levels that would
lead to a debt subject to limit of $10,207 billion in FY2009, a level that would require an increase
in the statutory debt limit. The budget conference report passed the Senate on a 48-45 vote on
June 4, 2008. The House passed the measure on the next day by a 214-210 vote. Agreement on
the FY2009 budget resolution automatically created and deemed passed in the House legislation
(H.J.Res. 92) that would increase the debt limit from its current level of $9,815 billion to $10,615
billion. Because the Senate did not take up H.J.Res. 92, the debt limit remained at $9,815 billion.
Subsequently, the House passed an amended version of the Housing and Economic Recovery Act
of 2008 (H.R. 3221) by a vote of 272-152 that included a debt limit increase to $10,615 billion on
July 23, 2008. The Senate then passed the measure on July 26 on a 72-13 vote. The President
signed the bill on July 30 (P.L. 110-289), increasing the debt limit. In addition to increasing the
debt limit, the act also contained provisions that would temporarily authorize the Secretary of
Treasury to extend a line of credit to mortgage guarantee agencies Freddie Mac and Fannie Mae.
The act also created the a new independent agency called the Federal Housing Finance Agency
(FHFA), which replaced the Department of Housing and Urban Development Office of Federal
Housing Enterprise Oversight (OFHEO) and the Federal Housing Finance Board (FHFB).
While CBO indicated that it was more likely than not that such intervention would not be needed,
it also estimated a 5% chance of a cost to taxpayers of more than $100 billion.58 Because debt
subject to limit was just $339 billion less than the debt ceiling of $9,815 billion when the Senate
55 U.S. Congress, Congressional Budget Office, An Analysis of the President’s Budgetary Proposals for Fiscal Year
2009, Table 1.1, March 2008, available at http://www.cbo.gov/ftpdocs/89xx/doc8990/03-19-AnalPresBudget.pdf.
55 U.S. Congress, Congressional Budget Office, The Budget and Economic Outlook: An Update, Table 1-1, August
2009, available at http://www.cbo.gov/doc.cfm?index=10521.
56 Goldman Sachs U.S. Research, “US Daily: The Fiscal 2008 Deficit—Likely to Top $500 Billion,” March 25, 2008.
57 U.S. Congress, House Committee on the Budget, Report to Accompany H. Con. Res. 312, 110th Cong., 2nd sess.,
H.Rept. 110-543, March 2008, p. 99; U.S. Congress, Senate Committee on the Budget, Report to Accompany S. Res.
70, S.Prt. 110-039, March 2008.
58 U.S. Congress, Congressional Budget Office, Cost Estimate for H.R. 3221 “Housing and Economic Recovery Act of
2008” As passed by the Senate on July 11, 2008, with an amendment transmitted to CBO on July 22, 2008, July 24,
2008, available at http://www.cbo.gov/ftpdocs/95xx/doc9597/hr3221.pdf.
Congressional Research Service
15
The Debt Limit: History and Recent Increases
passed H.R. 3221, some financial market participants may have worried that the debt limit,
without an increase, might have hindered the Treasury Secretary’s ability to intervene to support
Freddie Mac and Fannie Mae. On September 7, 2008, the FHFA placed Fannie Mae and Freddie
Mac in conservatorship, providing FHFA with the full powers to control the assets and operations
of the firms.
Since the deprivatization of Fannie Mae and Freddie Mac, the federal government has acted to
provide stability to financial markets.59 On September 20, 2008, the U.S. Treasury submitted a
proposal to Congress to authorize the Treasury Secretary to buy mortgage-related assets in order
to stabilize financial markets. The Treasury proposal would allow Treasury holdings of mortgage-
related securities up to $700 billion and would raise the debt limit to $11,315 billion.60
Representative Barney Frank proposed an amendment (Emergency Economic Stabilization Act of
2008) to a vehicle measure (H.R. 3997) that incorporated the main tenets of the Treasury proposal
including raising the debt limit to $11,315 billion.61 On September 29, 2008, however, the House
rejected that amendment.
On October 1, 2008, the Senate voted on, and passed, a different version of the Emergency
Economic Stabilization Act of 2008 (H.R. 1424) that included the same debt limit increase.62 The
House passed H.R. 1424 on October 3, 2008, and it was signed into law by the President (P.L.
110-343) on the same day, raising the debt limit to $11,315 billion.
Current economic conditions led Congress to consider another economic stimulus measure. This
measure contains both tax cuts and spending increases, which will increase the deficit by
reducing revenues and increasing outlays. The American Recovery and Reinvestment Act of 2009
(ARRA) as passed by the Senate on February 10, 2009 (Division B of the Senate Substitute
amendment to H.R. 1 and S. 350), contained a provision which would raise the debt limit to
$12,140 billion. The version of this legislation originally passed by the House omitted this
provision. The final conference agreement on ARRA was passed by the House and Senate on
February 13, 2009, and signed by the President on February 17, 2009 (P.L. 111-5). This measure
contained a provision increasing the debt limit to $12,104 billion.
The conference report on the Concurrent Resolution on the Budget for FY2010 (S.Con.Res. 13)
recommended policies that would lead to a debt subject to limit of $13,233 billion in FY2010, a
level that would require an increase in the statutory debt limit. The budget resolution also
contained a revised estimate of debt subject to limit of $12,016 billion for FY2009. The adoption
of this conference report on April 29, 2009, triggered the Gephardt rule (House Rule XXVII),
producing a House Joint Resolution (H.J.Res. 45) that would raise the debt limit by $925 billion
59 For additional information see CRS Report RS22956, The Cost of Government Financial Interventions, Past and
Present, by Baird Webel, Marc Labonte, and N. Eric Weiss.
60 U.S. Department of Treasury, “Fact Sheet: Proposed Treasury Authority to Purchase Troubled Assets,” Press release
hp-1150, Sept. 20, 2008, available at http://www.treas.gov/press/releases/hp1150.htm.
61 U.S. Congress, House Financial Services Committee, Emergency Economic Stabilization Act of 2008 (Amendment
to the Senate Amendment to H.R. 3997), available at http://www.house.gov/apps/list/press/financialsvcs_dem/
amend_001_xml.pdf. For text of debt limit provision, see Congressional Record, (Sept. 29, 2008), p. H10355.
62 U.S. Congress, Senate Banking, Housing, and Urban Affairs Committee, Emergency Economic Stabilization Act of
2008 (In the Nature of a Substitute to H.R. 1424), available at http://banking.senate.gov/public/_files/
latestversionAYO08C32_xml.pdf.
Congressional Research Service
16
The Debt Limit: History and Recent Increases
to $13,029 billion. Under the rule, the resolution was automatically deemed passed by the House
and sent to the Senate.
In August 2009, according to media reports, Secretary of Treasury Timothy Geithner notified
Congress that the debt limit would be reached in mid-October.63 On November 4, the U.S.
Treasury announced that it could postpone the time when federal debt would reach its statutory
limit until the middle or the end of December.64 Treasury dropped nearly $185 billion from its
balance sheet by reducing the amount of loans available through the Supplemental Financing
Program, an emergency loan program created in the days following Lehman Brothers’
bankruptcy, from $200 billion to $15 billion, which extended the time until the debt limit would
be reached.65 According to media reports, the Obama Administration also contemplated scaling
back the Troubled Asset Relief Program (TARP), which could also lower federal debt subject to
statutory limit. Repayments of TARP funds by major financial institutions could also lower the
amount of debt subject to limit.66 Other measures, such as those taken in 2003 during a “debt
issuance suspension period” (described above), could also have extended the U.S. Treasury’s
ability to operate within the debt limit. On the other hand, the U.S. Treasury was scheduled to
issue $48 billion of nonmarketable securities to the FDIC on December 30 and to make interest
payments to various federal trust funds on December 31 totaling about $100 billion, according to
Wall Street analysts, which in the absence of a debt limit increase, could have challenged
Treasury’s debt management activities in the absence of special accounting measures.67
In mid-December, according to media reports, senior Members of the House chose to forgo a
larger increase in the debt limit in favor of a smaller increase in the debt limit that would allow
the U.S. Treasury Department to continue normal debt management operations for two months or
so.68 H.R. 4314, a measure to raise the debt limit to $12,394 billion, was introduced on December
15, 2009, and passed by the House the next day on a 218-214 vote. The Senate passed it on
December 24 by a 60-39 vote, and the President signed the measure on December 28. On January
28, the Senate passed an amended version of H.J.Res. 45 on a 60-39 vote. The measure would
raise the debt ceiling by $1,900 billion, to $14,294 billion.69 In addition, one amendment to
impose certain pay-as-you-go (PAYGO) restrictions was approved on a 60-40 vote.70
Some Members of Congress have called for the creation of a national commission to address
federal debt and the government’s fiscal situation, which could be enabled through a measure
linked to an increase in the debt limit.71 An amendment (S.Amdt. 3302 to S.Amdt. 3299) to
63 CQ Weekly, “Fall 2009 Outlook: Debt Limit Increase,” September 7, 2009, p. 1966.
64 U.S. Treasury, “November 2009 Quarterly Refunding Statement,” press release tg346, November 4, 2009,
http://www.ustreas.gov/press/releases/tg346.htm; David Clarke and CQ Staff, “Treasury Gives Congress More
Breathing Room on Debt Limit,” CQ Today Online News, November 4, 2009.
65 For details, see Joseph Haubrich and John Lindner, “The Supplemental Financing Program,” Economic Trends,
Federal Reserve of Chicago, September 28, 2009, available at http://www.clevelandfed.org/research/trends/2009/1009/
03monpol.cfm.
66 The Money Market Observer: Wrightson ICAP’s Weekly Newsletter, December 7, 2009.
67 The Money Market Observer: Wrightson ICAP’s Weekly Newsletter, November 30, 2009.
68 Paul Kane, “House Democrats Discard Larger Debt Limit,” Washington Post, December 15, 2009, p. A4.
69 CQ Today Midday Update, “Senate Sends Debt Ceiling Increase to House,” January 28, 2010.
70 S.Amdt. 3305. A second amendment (S.Amdt. 3300), approved on a 97-0 vote, provides certain protections to the
Social Security program. Other amendments were not approved.
71 Jonathan Weisman and John D. McKinnon, “White House Weighs New Panel to Tackle Deficit: Bipartisan
Commission Considered As Administration Seeks to Show Resolve on a Problem that Dogs Its Broader Agenda,” Wall
(continued...)
Congressional Research Service
17
The Debt Limit: History and Recent Increases
H.J.Res. 45 that would have established a “Bipartisan Task Force for Responsible Fiscal Action”
was not approved on a 53-46 vote, having failed to reach 60 votes, on January 26, 2010. President
Obama then charged a National Commission on Fiscal Responsibility and Reform (Fiscal
Commission) with identifying “policies to improve the fiscal situation in the medium term and to
achieve fiscal sustainability over the long run.”72 The Fiscal Commission issued a report on
December 1, 2010, and several commissioners issued their own fiscal proposals as well.73
The House approved H.J.Res. 45 on a 233-187 vote on February 4, forwarding the measure to the
President. The Obama Administration had previously voiced its strong support for a debt limit
increase.74 The President signed the measure (P.L. 111-139) on February 12, 2010.
Table 2 summarizes the increases in the debt limit since 1993.75
Table 2. Increases in the Debt Limit Since 1993
Change From
Public Law (P.L.)
New Debt Limit
Previous Limit
Date
Number
($ billion)
($ billion)
April 6, 1993
P.L. 103-12
$4,370a $225
August 10, 1993
P.L. 103-66
4,900
530
February 8, 1996
P.L. 104-103
( b )
—
March 12, 1996
P.L. 104-115
( c ) —
March 29, 1996
P.L. 104-121
5,500
600d
August 5, 1997
P.L. 105-33
5,950
450
June 28, 2002
P.L. 107-199
6,400
450
May 27, 2003
P.L. 108-24
7,384
984
Nov. 19, 2004
P.L. 108-415
8,184
800
Mar. 20, 2006
P.L. 109-182
8,965
781
Sept. 29, 2007
P.L. 110-91
9,815
850
July 30, 2008
P.L. 110-289
10,615
800
Oct. 3, 2008
P.L. 110-343
11,315
700
(...continued)
Street Journal, November 26, 2009, p. A10.
72 Executive Order 13531, “National Commission on Fiscal Responsibility and Reform,” February
18, 2010; 75 FR 7927, February 23, 2010.
73 National Commission on Fiscal Responsibility and Reform, The Moment of Truth, report, December 1, 2010,
available at http://www.fiscalcommission.gov/sites/fiscalcommission.gov/files/documents/
TheMomentofTruth12_1_2010.pdf.
74 U.S. Office of Management and Budget, “H.J.Res. 45—Increasing the Statutory Limit on the Public Debt,”
Statement Of Administration Policy, January 20, 2010, available at http://www.whitehouse.gov/omb/assets/sap_111/
saphjr45s_20100120.pdf.
75 For a discussion of earlier debt limit increases, see CRS Report 98-805 E, Public Debt Limit Legislation: A Brief
History and Controversies In the 1980s and 1990s, by Philip D. Winters, which is available from the authors upon
request.
Congressional Research Service
18
The Debt Limit: History and Recent Increases
Change From
Public Law (P.L.)
New Debt Limit
Previous Limit
Date
Number
($ billion)
($ billion)
Feb. 17, 2009
P.L. 111-5
12,104
789
Dec. 28, 2009
P.L. 111-123
12,394
290
February 12, 2010
P.L. 111-139
14,294
1,900
Source: CRS, compiled using the Legislative Information System, available at http://www.congress.gov; OMB.
a. Increased the debt limit temporarily through September 30, 1993.
b. Temporarily exempted from limit obligations in an amount equal to the monthly insurance benefits payable
under Title II of the Social Security Act in March 1996, the exemption to expire on the earlier of an
increase in the limit or March 15, 1996.
c. Temporarily exempted from limit (a) obligations in an amount equal to the monthly insurance benefits
payable under Title II of the Social Security Act in March 1996 and (b) certain obligations issued to trust
funds and other Federal Government accounts, both exemptions to expire on the earlier of an increase in
the limit or March 30, 1996.
d. Difference from debt limit set on August 10, 1983.
Deficit Estimates
The size of the debt may remain a concern in the future due to the size of impending federal
deficits necessitating further increases in the debt limit. CBO warns that the current trajectory of
federal borrowing is unsustainable and could lead to slower economic growth in the long run as
debt rises as a percentage of GDP. The total federal deficit rose from $455 billion in FY2008 to
$1,413 billion in FY2009, and is estimated to reach $1,342 billion in FY2010.76 Much of the
increase in deficits can be attributed to weak economic and financial market turmoil that started
in late 2007, as well as to federal responses. Nonetheless, many budget experts remain concerned
that a slow economic recovery or a “double-dip” recession could keep federal revenues below
previous trendline projections for several years, and that the federal government would continue
to run large deficits.
Concluding Comments
Since the late 1950s, the federal government increased its borrowing from the public in all years,
except in FY1969 following imposition of a war surcharge and in the period FY1997-FY2001.
The persistence of federal budget deficits has required the government to issue more and more
debt to the public.77 The accumulation of Social Security and other trust funds, particularly after
1983 when recommendations of the Greenspan Commission were implemented, led to sustained
growth in government-held debt subject to limit.78 The growth in federal debt held by the public
76 U.S. Congressional Budget Office, The Budget and Economic Outlook: An Update, August 19, 2010, p. 1, available
at http://www.cbo.gov/doc.cfm?index=11705.
77 The ability to run fiscal deficits gives the federal government useful flexibility in managing its finances, although
large deficits may harm economic performance. See CRS Report RL33657, Running Deficits: Positives and Pitfalls, by
D. Andrew Austin.
78 Report of the National Commission on Social Security Reform, January 1983, available at http://www.ssa.gov/
history/reports/gspan.html.
Congressional Research Service
19
The Debt Limit: History and Recent Increases
and in intergovernmental accounts, such as trust funds, has periodically obliged Congress to raise
the debt limit.
Between August 1997, when the debt limit was raised to $5,950 billion, and the beginning of
FY2002 in October 2001, federal budget surpluses reduced debt held by the public. From the end
of FY2001, the last fiscal year with a surplus, until the end of FY2008, debt held by the public
subject to limit grew by $2,484 billion. Federal debt held in intergovernmental accounts grew
steadily throughout the period, rising by $1,743 billion since the beginning of FY2002.
In early 2001, the 10-year budget forecasts projected large and growing surpluses, indicating
rapid reduction in debt held by the public. Some experts expressed concern about consequences
of retiring all federal debt held by the public.79 Most long-term forecasts computed at that time,
however, showed large deficits emerging once the baby boomers began to retire. Short-term
forecasts projected continuous growth in debt held by government accounts, largely due to the
difference between Social Security tax revenues and benefit payments. The combination of falling
levels of publicly held debt and rising levels of debt held by government accounts moderated the
expected growth of total debt. The moderate growth in total debt those projections had forecast
was expected to postpone the need to increase the debt limit until late into the decade, when
accumulating debt in government accounts would overtake reductions in debt held by the public.
New budget projections released in early 2002 smashed expectations of large, persistent
surpluses, and hopes for reductions in debt held by the public collapsed. The return to large
federal deficits accelerated the growth of total debt. Increases in the debt limit would be necessary
much sooner than previously expected.
Early in 2003, the FY2003 deficit and the persistent rise in debt held by government accounts
drove the federal debt up to the $6,400 billion limit in effect at the time. The Treasury avoided
breaching the limit into May. Congress adopted a debt limit increase of $934 billion on May 23,
2003, that provided enough room for the growing federal debt through the fall of 2004. The debt
limit increase passed by Congress late in 2004 was expected, at the time, to accommodate the
government’s debt growth well into 2005, if not into early 2006. In late December 2005, and
early in 2006, the Treasury informed Congress that the limit would be reached between mid-
February and mid-March 2006. On March 16, 2006, the Senate passed the House-initiated debt
limit increase, raising the debt limit to $8,965 billion. The debt limit crisis was resolved when the
President signed the debt limit increase on March 20.
Smaller than expected deficits in FY2006 and FY2007 postponed, but did not end the need for a
new, higher debt limit. The House passed legislation in May 2007 (H.J.Res. 43) to raise the debt
limit. The Senate passed the measure (P.L. 110-91) on September 27, which the President signed
on September 29. Turmoil in some financial markets in August 2007, according to some
observers, appeared to constrain contention over the debt limit increase.
The 2008 economic slowdown, which reduced federal tax revenues and increased federal outlays,
caused federal deficit spending to rise, thus bringing forward the projected date when the federal
debt will reach its current limit. The House passed an amended version of the Housing and
Economic Recovery Act of 2008 (H.R. 3221) that included a debt limit increase to $10,615
79 Testimony of Federal Reserve Chairman Alan Greenspan, in U.S. Congress, Senate Committee on the Budget,
Outlook for the Federal Budget and Implications for Fiscal Policy, hearings, 107th Cong., 1st sess., January 25, 2001,
available at http://www.federalreserve.gov/boarddocs/testimony/2001/20010125/default.htm.
Congressional Research Service
20
The Debt Limit: History and Recent Increases
billion on July 23, 2008. The Senate passed the measure on July 26, and the President signed it on
July 30, raising the debt limit for the first time in 2008. Subsequently, the Emergency Economic
Stabilization Act of 2008 (H.R. 1424), signed into law on October 3 (P.L. 110-343), raised the
debt limit for the second time in 2008 to $11,315 billion. The debt limit was raised for the third
time in less than a year as a result of passage of the American Recovery and Reinvestment Act of
2009. President Obama signed this measure on February 17, 2009 (P.L. 111-5), which raised the
debt limit to $12,104 billion.
The debt limit was again raised in late 2009. H.R. 4314, passed by the House on December 16,
2009, and by the Senate on December 24, raised the debt limit to $12,394 billion when the
President signed the measure on December 28. In early 2010, Congress voted for a larger increase
in the debt limit, which would put the limit at $14,294 billion, raising the debt ceiling by $1,900
billion. President Obama signed the measure on February 12, 2010. This debt limit, according to
projections, will allow the Treasury Department to issue new debt at projected levels until spring
2011.
Amendments offered during consideration of the latest debt limit increase may signal a growing
concern with the fiscal sustainability. One amendment, which was not approved, would have
established a statutory commission to consider long-term fiscal issues. Another amendment,
which was approved, would impose certain PAYGO restrictions.80 President Obama then created
the National Commission on Fiscal Responsibility and Reform (Fiscal Commission), which was
charged with identifying “policies to improve the fiscal situation in the medium term and to
achieve fiscal sustainability over the long run.”81 A Fiscal Commission report, along with several
other budget policy proposals, could provide one framework for changes that might strengthen
the federal government’s fiscal outlook.82
Over the next decade, without major changes in federal policies, persistent and possibly growing
deficits, along with the ongoing growth in the debt holdings of government accounts, would
increase substantially the amount of federal debt subject to limit. Unless federal policies change,
Congress would repeatedly face demands to raise the debt limit to accommodate the growing
federal debt in order to provide the government with the means to meet its financial obligations.
Further Reading
Drishnakumar, Anita S., “In Defense of the Debt Limit Statute,” Harvard Journal on Legislation,
vol. 42, 2005, pp. 135-185.
Gordon, John Steele, Hamilton’s Blessing: the Extraordinary Life and Times of Our National
Debt, New York: Penguin, 1998.
80 For a discussion of PAYGO in the past, see CRS Report R41005, The Statutory PAYGO Process for Budget
Enforcement: 1991-2002, by Robert Keith.
81 Executive Order 13531, “National Commission on Fiscal Responsibility and Reform,” February 18, 2010; 75 FR
7927, February 23, 2010.
82 National Commission on Fiscal Responsibility and Reform, The Moment of Truth, report, December 1, 2010,
available at http://www.fiscalcommission.gov/sites/fiscalcommission.gov/files/documents/
TheMomentofTruth12_1_2010.pdf.
Congressional Research Service
21
The Debt Limit: History and Recent Increases
Hormats, Robert D., The Price of Liberty: Paying for America’s Wars from the Revolution to the
War on Terror, New York: Times Books, 2007.
Noll, Franklin, “The United States Public Debt, 1861 to 1975,” EH.Net Encyclopedia, edited by
Robert Whaples, May 26, 2004. Available at http://eh.net/encyclopedia/article/noll.publicdebt.
Wright, Robert E., One Nation Under Debt: Hamilton, Jefferson, and the History of What We
Owe, New York: McGraw-Hill, 2008.
Congressional Research Service
22
The Debt Limit: History and Recent Increases
Appendix. Debt Subject to Limit by Month Since
September 2001
Table A-1 provides data on the dollar amount, in current dollars, of federal debt and the changes
in these amounts by month between the end of September 2001 (the end of FY2001) and the end
of December 2010. The table shows outstanding monthly balances, subject to the debt limit, of
total federal debt, debt held by government accounts, and debt held by the public.
All three measures of debt subject to limit increased over this period. From the end of September
2001 (the end of FY2001) to the end of September 2010 (the most recently completed fiscal
year), total federal debt increased by $7,778 billion, debt held in government accounts increased
by $2,073 billion, and debt held by the public increased by $5,705 billion. All three measures
experienced periodic reductions in some months. Because federal receipts and outlays are spread
unevenly over the fiscal year, debt may rise or fall in a given month, even if debt measures follow
an overall increasing trend.
Table A-1. Debt Subject to Limit by Month, September 2001-December 2010
(in millions of current dollars)
Change
Change
Change
from
Held by
from
from
End of
Previous
Government
Previous
Held by the
Previous
Month
Total
Period
Accounts
Period
Public
Period
Sept.
2001
$5,732,802
—
$2,436,521
— $3,296,281 —
Oct. 2001
5,744,523
$11,721
2,451,815
$15,294
3,292,709
$-3,572
Nov. 2001
5,816,823
72,300
2,469,647
17,832
3,347,176
54,467
Dec. 2001
5,871,413
54,590
2,516,012
46,365
3,355,401
8,225
Jan. 2002
5,865,892
-5,521
2,525,755
9,743
3,340,138
-15,263
Feb. 2002
5,933,154
67,262
2,528,494
2,739
3,404,659
64,521
Mar. 2002
5,935,108
1,954
2,528,318
-176
3,406,789
2,130
Apr. 2002
5,914,816
-20,292
2,549,438
21,120
3,365,378
-41,411
May 2002
5,949,975
35,159
2,553,350
3,912
3,396,625
31,247
June 2002
6,058,313
108,338
2,630,646
77,296
3,427,667
31,042
July 2002
6,092,050
33,737
2,627,980
-2,666
3,464,070
36,403
Aug. 2002
6,142,835
50,785
2,620,946
-7,034
3,521,890
57,820
Sept. 2002
6,161,431
18,596
2,644,244
23,298
3,517,187
-4,703
Oct. 2002
6,231,284
69,853
2,680,812
36,568
3,550,472
33,285
Nov. 2002
6,294,480
63,196
2,680,788
-24
3,613,692
63,220
Dec. 2002
6,359,412
64,932
2,745,787
64,999
3,613,625
-67
Jan. 2003
6,355,812
-3,600
2,753,301
7,514
3,602,511
-11,114
Feb. 2003
6,399,975
44,163
2,750,471
-2,830
3,649,504
46,993
Mar. 2003
6,399,975
0
2,722,812
-27,659
3,677,163
27,659
Congressional Research Service
23
The Debt Limit: History and Recent Increases
Change
Change
Change
from
Held by
from
from
End of
Previous
Government
Previous
Held by the
Previous
Month Total Period
Accounts
Period
Public
Period
Apr.
2003
6,399,975
0 2,731,042 8,230 3,668,933 -8,230
May 2003
6,498,658
98,683
2,755,895
24,853
3,742,763
73,830
June 2003
6,625,519
126,861
2,842,361
86,466
3,783,158
40,395
July 2003
6,704,814
79,295
2,835,566
-6,795
3,869,247
86,089
Aug. 2003
6,743,775
38,961
2,829,387
-6,179
3,914,388
45,141
Sept. 2003
6,737,553
-6,222
2,846,730
17,343
3,890,823
-23,565
Oct. 2003
6,826,668
89,115
2,869,493
22,763
3,957,175
66,352
Nov. 2003
6,879,626
52,958
2,879,117
9,624
4,000,509
43,334
Dec. 2003
6,952,893
73,267
2,940,736
61,619
4,012,157
11,648
Jan. 2004
6,966,851
13,958
2,951,219
10,483
4,015,633
3,476
Feb. 2004
7,049,163
82,312
2,953,123
1,904
4,096,040
80,407
Mar. 2004
7,088,648
39,485
2,941,195
-11,928
4,147,453
51,413
Apr. 2004
7,089,700
1,052
2,960,151
18,956
4,129,549
-17,904
May 2004
7,151,523
61,823
2,973,869
13,718
4,177,653
48,104
June 2004
7,229,320
77,797
3,039,987
66,118
4,189,334
11,681
July 2004
7,271,328
42,008
3,033,396
-6,591
4,237,933
48,599
Aug. 2004
7,305,531
34,203
3,037,149
3,753
4,268,382
30,449
Sept. 2004
7,333,350
27,819
3,056,590
19,441
4,276,760
8,378
Oct. 2004
7,383,975
50,625
3,096,207
39,617
4,287,768
11,008
Nov. 2004
7,464,740
80,765
3,087,834
-8,373
4,376,906
89,138
Dec. 2004
7,535,644
70,904
3,158,531
70,697
4,377,114
208
Jan. 2005
7,567,702
32,058
3,171,089
12,558
4,396,615
19,501
Feb. 2005
7,652,726
85,024
3,176,406
5,317
4,476,320
79,705
Mar. 2005
7,715,503
62,777
3,175,460
-946
4,540,042
63,722
Apr. 2005
7,704,041
-11,462
3,185,364
9,904
4,518,677
-21,365
May 2005
7,717,574
13,533
3,207,232
21,868
4,510,342
-8,335
June 2005
7,778,128
60,554
3,280,914
73,682
4,497,214
-13,128
July 2005
7,829,029
50,901
3,278,725
-2,189
4,550,304
53,090
Aug. 2005
7,868,395
39,366
3,284,696
5,971
4,583,699
33,395
Sept. 2005
7,871,040
2,645
3,300,969
16,273
4,570,071
-13,628
Oct. 2005
7,964,782
93,742
3,345,589
44,620
4,619,193
49,122
Nov. 2005
8,028,918
64,136
3,351,093
5,504
4,677,826
58,633
Dec. 2005
8,107,019
78,101
3,424,304
73,211
4,682,715
4,889
Jan. 2006
8,132,290
25,271
3,442,543
18,239
4,689,747
7,032
Feb. 2006
8,183,975
51,685
3,457,409
14,866
4,726,567
36,820
Congressional Research Service
24
The Debt Limit: History and Recent Increases
Change
Change
Change
from
Held by
from
from
End of
Previous
Government
Previous
Held by the
Previous
Month Total Period
Accounts
Period
Public
Period
Mar. 2006
8,281,451
97,476
3,443,602
-13,807
4,837,849
111,282
Apr. 2006
8,262,718
-18,733
3,479,623
36,021
4,783,095
-54,754
May 2006
8,263,812
1,094
3,492,648
13,025
4,771,165
-11,930
June 2006
8,330,646
66,834
3,566,186
73,538
4,764,460
-6,705
July 2006
8,352,614
21,968
3,569,550
3,364
4,783,064
18,604
Aug. 2006
8,423,321
70,707
3,576,166
6,616
4,847,155
64,091
Sept. 2006
8,420,278
-3,043
3,622,378
46,212
4,828,972
-18,183
Oct. 2006
8,498,016
77,738
3,650,241
27,863
4,847,775
18,803
Nov. 2006
8,545,715
47,699
3,649,736
-505
4,895,979
48,204
Dec. 2006
8,592,513
46,798
3,724,450
74,714
4,868,063
-27,916
Jan. 2007
8,619,499
26,986
3,737,894
13,444
4,881,605
13,542
Feb. 2007
8,690,921
71,422
3,744,299
6,405
4,946,622
65,017
Mar. 2007
8,760,735
69,814
3,740,127
-4,172
5,020,608
73,986
Apr. 2007
8,753,070
-7,665
3,778,255
38,128
4,974,815
-45,793
May 2007
8,740,892
-12,178
3,792,201
13,946
4,948,691
-26,124
June 2007
8,779,168
38,276
3,867,819
75,618
4,911,348
-37,343
July 2007
8,845,417
66,249
3,873,239
5,420
4,972,178
60,830
Aug. 2007
8,918,493
73,076
3,854,115
-19,124
5,064,377
92,199
Sept. 2007
8,921,343
2,850
3,903,710
49,595
5,017,633
-46,744
Oct. 2007
8,994,639
73,296
3,958,357
54,647
5,036,281
18,648
Nov. 2007
9,065,827
71,188
3,950,468
-7,889
5,115,358
79,077
Dec. 2007
9,144,715
78,888
4,038,566
88,098
5,106,149
-9,209
Jan. 2008
9,155,842
11,127
4,053,199
14,633
5,102,644
-3,505
Feb. 2008
9,275,683
119,841
4,045,007
-8,192
5,230,676
128,032
Mar. 2008
9,358,135
82,452
4,051,685
6,678
5,306,450
75,774
Apr. 2008
9,298,567
-59,568
4,080,887
29,202
5,217,680
-88,770
May 2008
9,324,137
25,570
4,071,992
-8,895
5,252,144
34,464
June 2008
9,427,901
167,869
4,169,509
134,950
5,258,392
32,920
July 2008
9,520,220
92,319
4,144,377
-25,132
5,375,843
117,451
Aug. 2008
9,580,508
60,288
4,129,413
-14,964
5,451,095
75,252
Sept. 2008
9,959,850
379,342
4,179,574
50,161
5,780,276
329,181
Oct. 2008
10,504,702
544,852
4,231,878
52,304
6,272,824
492,548
Nov. 2008
10,595,725
91,023
4,228,270
-3,608
6,367,454
94,630
Dec. 2008
10,640,274
44,549
4,298,482
70,212
6,341,792
-25,662
Jan. 2009
10,569,310
-70,964
4,278,424
-20,058
6,290,886
-50,906
Congressional Research Service
25
The Debt Limit: History and Recent Increases
Change
Change
Change
from
Held by
from
from
End of
Previous
Government
Previous
Held by the
Previous
Month Total Period
Accounts
Period
Public
Period
Feb. 2009
10,814,630
245,320
4,261,734
-16,690
6,552,896
262,010
Mar. 2009
11,066,217
251,587
4,258,272
-3,462
6,807,946
255,050
Apr. 2009
11,178,827
112,610
4,273,005
14,733
6,905,822
97,876
May 2009
11,260,445
81,618
4,265,719
-7,286
6,994,725
88,903
June 2009
11,487,470
227,025
4,336,673
70,954
7,150,797
156,072
July 2009
11,611,178
123,708
4,299,673
-37,000
7,311,505
160,708
Aug. 2009
11,755,205
144,027
4,294,923
-4,750
7,460,282
148,777
Sept. 2009
11,853,434
98,229
4,325,124
30,201
7,528,311
68,029
Oct. 2009
11,836,629
-16,805
4,372,308
47,184
7,464,321
-63,990
Nov. 2009
12,057,363
220,734
4,367,935
-4,373
7,689,428
225,107
Dec. 2009
12,254,506
197,143
4,466,279
98,344
7,788,227
98,799
Jan. 2010
12,222,507
-31,999
4,485,502
19,223
7,737,005
-51,222
Feb. 2010
12,383,717
161,210
4,469,373
-16,129
7,914,344
177,339
Mar. 2010
12,716,511
332,794
4,448,645
-20,728
8,267,866
353,522
Apr. 2010
12,892,729
176,218
4,480,458
31,813
8,412,271
144,405
May 2010
12,992,539
99,810
4,498,120
17,662
8,494,419
82,148
June 2010
13,149,560
157,021
4,537,716
39,596
8,611,844
117,425
July 2010
13,185,208
35,648
4,504,601
-33,115
8,680,607
68,763
Aug. 2010
13,398,794
213,586
4,493,418
-11,183
8,905,376
224,769
Sept. 2010
13,510,840
112,046
4,509,632
16,214
9,001,208
95,832
Oct. 2010
13,617,337
106,497
4,568,895
59,263
9,048,442
47,234
Nov. 2010
13,809,121
191,784
4,555,396
-13,499
9,253,725
205,283
Dec. 2010
13,972,513
163,392
4,603,888
48,492
9,368,625
114,900
Source: U.S. Treasury, Bureau of the Public Debt, Monthly Statement of the Public Debt, Sept. 2001-Nov. 2010,
available at http://www.treasurydirect.gov/govt/reports/pd/mspd/mspd.htm; CRS calculations. Dec. 2010 data
computed from Daily Treasury Statement.
Author Contact Information
D. Andrew Austin
Mindy R. Levit
Analyst in Economic Policy
Analyst in Public Finance
aaustin@crs.loc.gov, 7-6552
mlevit@crs.loc.gov, 7-7792
Congressional Research Service
26