The Debt Limit: History and Recent Increases
D. Andrew Austin
Analyst in Economic Policy
Mindy R. Levit
Analyst in Public Finance
January 10, 2013
Congressional Research Service
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www.crs.gov
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CRS Report for Congress
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epared for Members and Committees of Congress

The Debt Limit: History and Recent Increases

Summary
Total federal debt 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.
On August 2, 2011, President Obama signed the Budget Control Act of 2011 (BCA; S. 365; P.L.
112-25), after an extended debt limit episode. The federal debt had reached its legal limit on May
16, 2011, prompting Treasury Secretary Timothy Geithner to declare a debt issuance suspension
period, allowing certain extraordinary measures to extend Treasury’s borrowing capacity. The
BCA included provisions aimed at deficit reduction and allowing the debt limit to rise between
$2,100 billion and $2,400 billion in three stages, the latter two subject to congressional
disapproval. Once the BCA was enacted, a presidential certification triggered a $400 billion
increase, raising the debt limit to $14,694 billion, and a second $500 billion increase on
September 22, 2011, as a disapproval measure (H.J.Res. 77) only passed the House. A January 12,
2012, presidential certification triggered a third, $1.2 trillion increase on January 28, 2012. On
January 18, 2012, the House passed a disapproval measure (H.J.Res. 98) on a 239-176 vote. The
Senate declined to take up a similar measure (S.J.Res. 34), on a 44-52 vote on January 26, 2012.
Federal debt reached its limit on December 31, 2012. Extraordinary measures are being used to
meet federal payments, which are estimated to allow payment of government obligations until
mid-February or early March 2013. Those estimates are subject to uncertainty.
Congress has always placed restrictions on federal debt. The form of debt restrictions, structured
as amendments to the Second Liberty Bond Act of 1917, evolved into a general debt limit in
1939. Congress has voted to raise the debt limit 11 times since 2001, 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 and again in October 2004, which was
enacted on November 19, 2004. In 2005, reconciliation instructions in the FY2006 budget
resolution (H.Con.Res. 95) included a debt limit increase. After warnings from the U.S. Treasury,
Congress passed an increase that the President signed on March 20. In 2007, Congress approved
legislation (H.J.Res. 43) to raise the debt limit by $850 billion to $9,815 billion that the President
signed September 29, 2007.
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). Following that
measure, the debt limit was subsequently increased by $290 billion to $12,394 billion (P.L. 111-
123) in a stand-alone debt limit bill on December 28, 2009, and by $1.9 trillion to $14,294 billion
on February 12, 2010 (P.L. 111-139), as part of a package that also contained the Statutory Pay-
As-You-Go Act of 2010. This report will be updated as events warrant.
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Contents
Introduction ...................................................................................................................................... 1
The Budget Control Act of 2011 ............................................................................................... 2
Debt Limit Increases Under the BCA ................................................................................. 3
The Debt Limit and the Treasury ..................................................................................................... 4
Why Have a Debt Limit? ........................................................................................................... 6
A Brief History of the Federal Debt Limit ....................................................................................... 7
Origins of the Federal Debt Limit ............................................................................................. 7
World War II and After .............................................................................................................. 9
The Debt Ceiling in the Last Decade ............................................................................................. 10
The Debt Limit Issue in 2002 .................................................................................................. 14
Resolving the Debt Limit Issue in 2002 ............................................................................ 15
The Debt Limit Issue in 2003 .................................................................................................. 16
The Debt Limit Issue in 2004 .................................................................................................. 16
The Debt Limit Issue in 2005, 2006, and 2007 ....................................................................... 17
The Economic Slowdown and Federal Debt ........................................................................... 18
Fiscal Policy Considerations ............................................................................................. 18
Raising the Debt Ceiling in 2008, 2009, and 2010 ........................................................... 19
Raising the Debt Ceiling in 2011 ...................................................................................... 22
The Coming Trajectory of Federal Debt and Deficits ....................................................... 25
Concluding Comments .................................................................................................................. 25
Further Reading ............................................................................................................................. 27

Figures
Figure 1. Components of Federal Debt As a Percentage of GDP, FY1940-FY2016 ..................... 12

Tables
Table 1. Components of Debt Subject to Limit, FY1996-FY2011 ................................................ 11
Table 2. Increases in the Debt Limit 1993-2011 ............................................................................ 13
Table A-1. Debt Subject to Limit by Month, September 2001-December 2011 ............................ 28
Table B-1. Major Federal Debt Measures, 1898-1941................................................................... 33

Appendixes
Appendix A. Debt Subject to Limit by Month Since September 2001 .......................................... 28
Appendix B. Major Debt Measures Before the Entry of United States into World War II ............ 33

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Contacts
Author Contact Information........................................................................................................... 33

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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 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
On August 2, 2011, President Obama signed into law the Budget Control Act of 2011 (BCA; S.
365), after an extended debt limit episode. The federal debt reached its statutory limit on May 16,
2011, prompting Treasury Secretary Timothy Geithner to declare a debt issuance suspension
period, allowing certain extraordinary measures to extend Treasury’s borrowing capacity. The
BCA included provisions aimed at deficit reduction and would allow the debt limit to rise
between $2,100 billion and $2,400 billion in three stages, with the latter two subject to
congressional disapproval. All three increases, totaling $2,100 billion, have occurred.
A January 12, 2012, presidential certification triggered a third, $1.2 trillion increase that took
place on January 28, 2012. A disapproval measure, which would have been subject to veto, could
have blocked that increase if enacted within 15 days of the certification.6 On January 18, 2012,
the House passed such a measure (H.J.Res. 98) on a 239-176 vote. The Senate declined to take up
a companion measure (S.J.Res. 34), on a 44-52 vote on January 26, 2012, thus clearing the way
for the increase, resulting in a debt limit of $16,394 billion. As of December 24, 2012, total
federal debt subject to limit was $16,299 billion and debt held by the public was $11,543 billion.7

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 U.S.C. §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. See CRS Report R41815, Overview of the Federal Debt, by D.
Andrew Austin.
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 President Barack Obama, Letter from the President to the Speaker of the House of Representatives and the President
of the Senate Regarding the Debt Limit, January 12, 2012, available at http://www.whitehouse.gov/the-press-office/
2012/01/12/letter-president-speaker-house-representatives-and-president-senate-rega.
7 The Daily Treasury Statement’s Table III-C provides current information on debt subject to limit; available at
http://fms.treas.gov/dts/index.html.
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On December 26, 2012, the U.S. Treasury stated that the debt will reach its limit on December 31
and that the Treasury Secretary would declare a debt issuance suspension period to authorize
extraordinary measures (noted above, described below) that could be used to meet federal
payments for approximately two months.8 As predicted, federal debt did reach its limit on
December 31 when large biannual interest payments, in the form of Treasury securities, were
made to certain trust funds.
The U.S. Treasury stressed that these extraordinary measures will be exhausted more quickly than
in recent debt limit episodes for various technical reasons.9 In November 2012, CBO estimated
that federal debt will reach its limit near the end of December 2012, and that the extraordinary
measures could be used to fund government activities until mid-February or early March 2013.10
One policy research group has projected that the deadline for action would fall in mid February,11
while other estimates put that date at the beginning of March 2013.12 Changes in economic
conditions or financial markets, as well as in federal taxation and expenditure trends, could
strongly affect Treasury’s debt management requirements. How recent changes in tax provisions
alter the flow of individual tax filings may also affect the U.S. Treasury’s cash flows.
Speaker John Boehner said in May 2012 that a future debt limit increase should be linked to
spending cuts of at least the same magnitude, a position that reflects the structure of the Budget
Control Act.13
The Budget Control Act of 2011
On August 2, 2011, President Obama signed into law the Budget Control Act of 2011 (P.L. 112-
25), following House approval of the measure by a vote of 269-161 on August 1, 2011, and
Senate approval by a vote of 74-26 on August 2, 2011.14 This measure included numerous
provisions aimed at deficit reduction, and would allow a series of increases in the debt limit of up
to $2,400 billion ($2.4 trillion) subject to certain conditions.15
This measure includes major provisions that

8 Treasury Secretary Timothy Geithner, letter to Senate Majority Leader Harry Reid, December 26, 2012. Identical
letters were sent to other congressional leaders. Presently and in similar past circumstances, the U.S. Treasury has held
debt subject to limit $25 million below the statutory limit. Large biannual interest payments to certain trust funds are
due on December 31.
9 See Appendix to the December 26, 2012, letter to Majority Leader Reid: available at http://www.treasury.gov/
connect/blog/Documents/Appendix%20—%20Extraordinary%20Measures%2012-26-2012.pdf.
10 CBO, Federal Debt and the Statutory Limit, November 2012, available at http://www.cbo.gov/sites/default/files/
cbofiles/attachments/43736-FederalDebtLimit-11-12-12.pdf.
11 Bipartisan Policy Center, “Debt Limit Analysis,” January 7, 2013, available at http://bipartisanpolicy.org/sites/
default/files/Debt%20Limit%202013.pdf.
12 Wrightson ICAP, “Budget Battles and the Debt Ceiling Outlook,” Money Market Observer, January 7, 2013.
13 Speaker John Boehner, “Address on the Economy, Debt Limit, and American Jobs,” May 16, 2012, prepared text
available at http://www.speaker.gov/speech/full-text-speaker-boehners-address-economy-debt-limit-and-american-jobs.
14 Consideration of this measure began on July 25, 2011, following legislation introduced by House Speaker Boehner
(House Substitute Amendment to S. 627) and Majority Leader Reid (S.Amdt. 581 to S. 1323). Speaker Boehner’s
proposal passed the House on July 29, 2011, by a vote of 218-210. Neither proposal passed in the Senate.
15 For details, see CRS Report R41965, The Budget Control Act of 2011, by Bill Heniff Jr., Elizabeth Rybicki, and
Shannon M. Mahan.
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• impose discretionary spending caps, enforced by automatic spending reductions,
referred to as a sequester;16
• establish a Joint Select Committee on Deficit Reduction, whose
recommendations would be eligible for expedited consideration;
• require a vote on a joint resolution on a proposed constitutional amendment to
mandate a balanced federal budget;17 and
• institute a mechanism allowing for the President and Treasury Secretary to raise
the debt ceiling, subject to congressional disapproval.
Debt Limit Increases Under the BCA
The legislation provides a three-step procedure by which the debt limit can be increased. First, the
debt limit was raised by $400 billion, to $14,694 billion on August 2, 2011, following a
certification of the President that the debt was within $100 billion of its legal limit.18
A second increase of $500 billion occurred on September 22, 2011, which was also triggered by
the President’s certification of August 2. The second increase, scheduled for 50 days after that
certification, was subject to a joint resolution of disapproval. Because such a resolution could be
vetoed, blocking a debt limit increase would be challenging. The Senate rejected a disapproval
measure (S.J.Res. 25) on September 8, 2011, on a 45-52 vote. The House did pass a disapproval
measure (H.J.Res. 77) on a 232-186 vote, although the Senate declined to act on that measure.
In late December 2011, the debt limit came within $100 billion of its statutory limit, which
triggered a provision allowing the President to issue a certification that would lead to a third
increase of $1.2 trillion.19 That increase was also subject to a joint resolution of disapproval. The
President reportedly delayed that request to allow Congress to consider a disapproval measure.20
The third increase could also have been triggered in two other ways.21 A debt limit increase of
$1.5 trillion would have been permitted if the states had received a balanced budget amendment
for ratification. A measure (H.J.Res. 2) to accomplish that, however, failed to reach the
constitutionally mandated two-thirds threshold in the House in a 261–165 vote held on November

16 Sequestration is a mechanism that directs the President to cancel budget authority or other forms of budgetary
resources in order to reach specified budget reduction targets. Balanced Budget and Emergency Deficit Control Act of
1985 (P.L. 99-177), often known as Gramm-Rudman-Hollings (GRH), introduced sequestration procedures into the
federal budget process. Those sequestration procedures were modified in subsequent years to address separation of
powers issues and other concerns. For details, see CRS Report R41901, Statutory Budget Controls in Effect Between
1985 and 2002
, by Megan S. Lynch. Also see The Budget Control Act and Alternate Defense and Non-Defesne
Spending Paths, FY2012-FY2021
, congressional distribution memorandum, November 16, 2012, available from
authors upon request.
17 See CRS Report R41907, A Balanced Budget Constitutional Amendment: Background and Congressional Options ,
by James V. Saturno and Megan S. Lynch.
18 White House, Message from the President to the U.S. Congress, August 2, 2011, available at
http://m.whitehouse.gov/the-press-office/2011/08/02/message-president-us-congress.
19 For example, on December 30, 2011, debt subject to limit was $15,180 billion, just $14 billion below its statutory
limit. The U.S. Treasury pays interest to Social Security and certain other trust funds in the form of Treasury securities
at the end of June and December, which increases debt subject to limit.
20 CQ Roll Call Daily Briefing, January 3, 2012.
21 Congress could have considered a joint resolution of disapproval for this increase.
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18, 2011.22 The debt limit could also have been increased by between $1.2 trillion and $1.5
trillion had recommendations from the Joint Select Committee on Deficit Reduction, popularly
known as the Super Committee, been reported to and passed by each chamber. If those
recommendations had been estimated to achieve an amount between $1.2 trillion and $1.5 trillion,
the debt limit increase would be matched to that figure. The Joint Select Committee, however,
was unable to agree on a set of recommendations.
As neither of these two other options apply, the third increase in the debt limit was $1.2 trillion,
matching budget reductions slated to be made through sequestration and related mechanisms over
the FY2013-FY2021 period.
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 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 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.23 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.”24 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

22 Ratification requires approval by legislatures of three-fourths of the states. Article V specifies other means of
amendment involving constitutional conventions as well.
23 See CRS Report R41633, Reaching the Debt Limit: Background and Potential Effects on Government Operations,
coordinated by Mindy R. Levit.
24 Government Accountability Office, Debt Limit: Delays Create Debt Management Challenges and Increase
Uncertainty in the Treasury Market
, GAO-11-203, February 22, 2011.
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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,25 and the Internal Revenue Code, which requires the government to pay interest
penalties if tax refunds are delayed beyond a certain date.26
Several credit ratings agencies and investment banks have expressed concerns about the
consequences to the financial system and the economy if the U.S. Treasury were unable to fund
federal obligations.27 Many economists and financial institutions have stated that if the market
associated Treasury securities with default risks, the effects on global capital markets could be
significant.28
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.29
Some U.S. Treasury responses to the credit crunch that began in mid-2007 created balance sheet
items that expanded options available to the Treasury Secretary, although such options would now
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 2008.30 The pace of
those sales was targeted at $10 billion per month in order to minimize any market disruptions in
the mortgage securities market. As of March 2012, however, that Treasury portfolio of MBSs has
been eliminated.31 Proceeds of other potential asset sales are unlikely to allow 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.

25 31 U.S.C. §3902. See CRS Report R41230, Legal Protections for Subcontractors on Federal Prime Contracts, by
Kate M. Manuel.
26 26 U.S.C. §6611.
27 Reuters, “S&P To Deeply Cut U.S. Ratings If Debt Payment Missed,” June 29, 2011. For a summary of statements
by the three major ratings agencies, see CRS Report R41932, Treasury Securities and the U.S. Sovereign Credit
Default Swap Market
, by D. Andrew Austin and Rena S. Miller.
28 JP Morgan Chase, “The Domino Effect of a US Treasury Technical Default,” U.S. Fixed Income Strategy Group
Brief, April 19, 2011; Fitch Ratings, “Thinking the Unthinkable—What if the Debt Ceiling Was Not Increased and the
US Defaulted?” June 8, 2011.
29 For details, see out-of-print 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 the authors.
5 U.S.C. §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
U.S.C. §8348(j,k).
30 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.
31 See the monthly portfolio statements available at http://www.treasury.gov/resource-center/data-chart-center/Pages/
mbs-purchase-program.aspx. Also see 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.
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U.S. Treasury contends that other types of asset sales are unlikely to provide a prudent or
practical method of easing debt limit constraints.32
Some have suggested that the 14th Amendment (section 4), which states that “(t)he validity of the
public debt of the United States ... shall not be questioned,” could provide the President with
authority to ignore the statutory debt limit. President Obama has rejected such claims, as have
most legal analysts.33 More imaginative strategies to avoid debt ceiling constraints have also been
proposed.
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.34 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.35 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.”36 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

32 Mary Miller, Assistant Secretary of the Treasury for Financial Markets, “Federal Asset Sales Cannot Avoid Need for
Increase in Debt Limit,” Treasury Notes blog, May 6, 2011, available at http://www.treasury.gov/connect/blog/Pages/
Federal-Asset-Sales-Cannot-Avoid-Need-for-Increase-in-Debt-Limit.aspx. These points were reiterated in the
Appendix to the Treasury Secretary’s December 26, 2012, letter to Majority Leader Harry Reid; available at
http://www.treasury.gov/connect/blog/Documents/Appendix%20—%20Extraordinary%20Measures%2012-26-
2012.pdf.
33 Adam Liptak, “The 14th Amendment, the Debt Ceiling and a Way Out,” New York Times, January 24, 2011;
Remarks by the President at University of Maryland Town Hall, available at http://www.whitehouse.gov/the-press-
office/2011/07/22/remarks-president-university-maryland-town-hall. For a legal analysis, see CRS congressional
distribution memorandum, Whether the Public Debt Clause Authorizes the President to Borrow Money in Excess of the
Debt Ceiling
, December 21, 2012, by Kenneth R. Thomas.
34 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.
35 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.
36 Marshall A. Robinson, The National Debt Ceiling: An Experiment in Fiscal Policy, Washington, DC: The Brookings
Institution, 1959, p. 5.
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determine the size of the federal deficit.37 The Obama Administration has proposed allowing
increases in the debt limit subject to congressional disapproval.38
While the budget process provides Congress with one means of controlling federal spending, the
debt limit may provide a different sort of leverage that is not redundant. Congress ordinarily
delegates work to its committees. The Committees on Appropriations have special responsibilities
regarding discretionary spending and authorizing committees are generally responsible for
mandatory program spending decisions, while Committees on the Budget are tasked with drafting
an overall budgetary framework that specifies aggregate levels for federal spending and taxation.
While those committees often incorporate views of other committees and Members, measures
involving the debt limit often provide individual Members not belonging to those committees
with a separate instrument to influence federal fiscal policy.
A Brief History of the Federal Debt Limit
Origins of the Federal Debt Limit
Congress has always placed restrictions on federal debt. Limitations on federal debt have helped
Congress assert its constitutional powers of the purse, of taxation, and the initiation of war.
Between World War I and World War II the form of statutory restrictions on federal debt evolved
into an aggregate limit that applied to nearly all federal debt outstanding.
Before World War I, Congress often authorized borrowing for specified purposes, such as the
construction of the Panama Canal.39 Congress also often specified which types of financial
instruments Treasury could employ, and specified or limited interest rates, maturities, and details
of when bonds could be redeemed. In other cases, especially in time of war, Congress provided
the Treasury with discretion, subject to broad limits, to choose debt instruments.40 Some
opponents raised concerns that granting the Treasury Secretary authority to issue debt could affect
monetary policies, which might tighten credit conditions. Proponents contended that federal
borrowing would not disrupt settlements on such monetary issues reached in 1878 and 1890.
Such concerns became moot after the establishment of the Federal Reserve System in 1913.
For example, the War Revenue Act of 1898 allowed Treasury to use certificates of indebtedness,
which had maturities of a year or less, and were used for short-term borrowing and cash
management, as well as long-term bonds.41 For example, the 1898 War Revenue Act (30 Stat.

37 Bruce Bartlett, “Why Congress Must Now Abolish its Debt Limit,” Financial Times, October 22, 2009, p. 11; Brian
C. Roseboro, Assistant Secretary for Financial Markets, U.S. Treasury, “Remarks to the Bond Market Association’s
Inflation-Linked Securities Conference”, New York, NY, available at http://web.archive.org/web/20080709100455/
http://www.treas.gov/press/releases/js506.htm.
38 Treasury Secretary Geithner outlined these proposals on December 2, 2012. See Jenni LeCompte, “Taking the Threat
of Default Out of the Debt Limit,” Treasury Notes blog, December 5, 2012, available at http://www.treasury.gov/
connect/blog/Pages/mcconnell-provision.aspx.
39 Spooner Act of June 28, 1902 (32 Stat 481; P.L. 57-183).
40 Marshall A. Robinson, The National Debt Ceiling: An Experiment in Fiscal Policy, (Washington, DC: Brookings
Institution, 1959), pp.1-6.
41 The War Revenue Act 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.
(continued...)
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448-470) that funded Spanish-American War costs granted the Treasury Secretary the authority to
have $100 million outstanding in certificates of indebtedness with maturities under a year, which
were mainly sold to large investors, banks, and other financial institutions. The act also allowed
the Treasury to issue $400 million in longer-term notes and bonds, which were made available to
public subscription, allowing smaller investors to participate. Proponents of the act, however,
made clear their intention to allow the Treasury Secretary substantial administrative leeway
within those limits.42
Over time, the leeway granted the Treasury Secretary tended to expand. For example, the Second
Liberty Bond Act of 1917, which helped finance the United States’ entry into World War I,
dropped certain limits on the maturity and redemption of bonds.43 The act also incorporated
unused borrowing capacity authorized by the First Liberty Bond Act (40 Stat 35; P.L. 65-3) and
other previous borrowing acts.44 Separate limits for previous debt issues, however, were retained
in the text of that act—an overall aggregated debt limit evolved later. Features of debt authorized
by previous acts, such as the broad tax exemption for First Liberty Bond Act securities, remained
intact.
Subsequent borrowing measures were drafted as amendments to Second Liberty Bond Act until
1982.45 Setting debt policy by amendments to the Second Liberty Bond Act of 1917 rather than
through original statutes reflected changes in legislative drafting practices at that time.46
In the 1920s, Congress provided Treasury Secretary Andrew Mellon with additional leeway in
order to replace expensive older federal debt with cheaper new issues. Congress allowed Treasury
to issue notes, a financial instrument issued extensively in the Civil War and rarely thereafter, and
limited the amount of notes outstanding, rather than the sum of issuances, which gave greater

(...continued)
469).
42 See House debate, Congressional Record, vol. 31, part 6 (June 9, 1898), pp. 5713-5728; and Senate debate on June
10, 1898, pp. 5732-5749.
43 P.L. 65-43, 40 Stat. 288, enacted September 24, 1917. See H. J. Cooke and M. Katzen, “The Public Debt Limit,”
Journal of Finance, vol. 9, no. 3 (September 1954), pp. 298-303. The Second Liberty Bond Act allowed purchases of
government debt of allied (i.e., Entente) countries, which would have complicated limits on the final redemption of
federal bonds issued to fund their purchase. Some federal bonds issued in the wake of the Panic of 1893 did not have
maturity limits.
44 The other acts were the Panama Canal measure (Spooner Act; P.L. 57-183), the Payne-Aldrich Tariff Act of August
5, 1909 (36 Stat 11; P.L. 61-5); and two emergency bond measures passed in March 1917 (39 Stat 1002 and 39 Stat
1021).
45 In 1982, the debt limit was codified into 31 U.S.C. §3101 by P.L. 97-258. Subsequent changes in the debt limit have
been drafted as amendments to 31 U.S.C. §3101.
46 Middleton Beaman, a former Law Librarian of the Library of Congress, Columbia Law School professor, and
advocate for the professionalization of drafting legislation, returned to Washington in 1916 to assist the House Ways
and Means Committee, which originated the Liberty Bond acts and other borrowing and revenue measures. This
arrangement was formalized in 1918, when the Legislative Drafting Service, the predecessor office of the modern
Office of Legislative Counsel, was established. Donald R. Kennon and Rebecca M. Rodgers, The Committee on Ways
and Means a Bicentennial History 1789-1989
, H. Doc. 100-244, p. 258. See also, Middleton Beaman, “Bill Drafting,”
Law Library Journal, vol. 7 (1914), pp. 64-71. For a critical view of legislative drafting in prior decades, see James
Bryce, The American Commonwealth, 3rd revised ed., vol. 1 (New York: Macmillan, 1920), chapter XV on
“Congressional Legislation.”
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Treasury flexibility to roll over debt. Savings certificates designed for small investors were also
reintroduced.47
In the 1930s, Congress moved towards aggregate constraints on federal borrowing that allowed
the Treasury greater ability to respond to changing conditions and more flexibility in financial
management. In March 1939, President Franklin Roosevelt and Treasury Secretary Henry
Morgenthau asked Congress to eliminated separate limits on bonds and on other types of debt.48
The House approved the measure (H.R. 5748) on March 23, 1939, the Senate passed it on June 1
(P.L. 76-201). When enacted on June 20, the measure created the first aggregate limit ($45
billion) covering nearly all public debt.49 Combining a $30 billion limit on bonds with a $15
billion limit on shorter-term debt, while retaining the $45 billion total limit in effect, enabled
Treasury to roll over maturing notes into longer-term bonds. 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
interest rate changes.50 While a separate $4 billion limit for “National Defense” series securities
was introduced in 1940, legislation in 1941 folded that borrowing authority back under an
increased aggregate limit of $65 billion.51
Although the Treasury was delegated greater independence of action on the eve of the United
States’ entry into World War II, the debt limit at the time 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 FY1919.52 By contrast, the debt limit in 1939 was $45 billion, only
about 10% above the $40.4 billion total federal debt of that time.53
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.54 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 76 separate
measures that have altered the limit on federal debt.55 Most of these changes in the debt limit

47 Revenue Act of November 23, 1921 (42 Stat 227; P.L.67-98). See also Paul Studenski and Herman E. Kroos,
Financial History of the United States, 2nd ed. (New York: McGraw-Hill, 1963), p. 316.
48 New York Times, “President Urges Ending of Limit on Bonded Debt; Asks Congress to Facilitate Borrowing by
Eliminating $30,000,000,000, ‘Ceiling’ Stands By Total Debt Top $45 Billion All Right for Now, Message Says—
Yielding to Economizers is Seen,” March 21, 1939.
49 P.L. 76-201. See also Senate debate, Congressional Record, vol. 84, part 6 (June 1, 1939), pp. 6480, 6497-6501.
50 This limit did not apply to certain previous public debt issues that comprised a very minor portion of the federal debt.
51 Revenue Act of June 25, 1940 (54 Stat 516; P.L. 76-656) and Revenue Act of February 19, 1941 (55 Stat 7).
52U.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.
53 For a list of changes in the debt limit between September 1917 and 1941, see U.S. Treasury, Statistical Appendix
1980
, Table 32 entitled “Debt limitation under the Second Liberty Bond Act, as amended, beginning 1917.”
54 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).
55 U.S. Office of Management and Budget, FY2010 Budget of the U.S. Government: Historical Tables, Table 7-3.
(continued...)
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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 and in February
2010 the debt limit was increased by $1.9 trillion (P.L. 111-139).
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. Table 1 shows
components of debt in current dollars and as percentages of gross domestic product (GDP).56
Figure 1 shows the components of federal debt as shares of gross domestic product (GDP) from
FY1940 through FY2011, along with Administration projections through FY2016.57 Table 1
summarizes the increases in the debt limit from 1993-2011.58


(...continued)
Increases in the debt limited potentially enabled by the Budget Control Act of 2011 are counted as one alteration.
56 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.
57 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.
58 For a list of debt limit votes, see CRS Report R41814, Votes on Measures to Adjust the Statutory Debt Limit, 1978 to
Present
, by Justin Murray. For a discussion of earlier debt limit increases, see out-of-print 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.
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Table 1. Components of Debt Subject to Limit, FY1996-FY2011
(in billions of current dollars and as percentage of GDP)
Debt Subject to Limit
End of Fiscal
Debt
Total
Intragovernmental
Held by the Public
Year
Limit
$ Billion
% of GDP
$ Billion
% of GDP
$ Billion
% of GDP
1996
5,500
5,137.2
66.6%
1,432.4
18.6%
3,704.8
48.0%
1997
5,950
5,327.6
64.9%
1,581.9
19.3%
3,745.8
45.6%
1998
5,950
5,439.4
62.8%
1,742.1
20.1%
3,697.4
42.7%
1999
5,950
5,567.7
60.5%
1,958.2
21.3%
3,609.5
39.2%
2000
5,950
5,591.6
56.9%
2,203.9
22.4%
3,387.7
34.5%
2001
5,950
5,732.8
56.1%
2,436.5
23.8%
3,296.3
32.2%
2002
6,400
6,161.4
58.4%
2,644.2
25.1%
3,517.2
33.4%
2003
7,384
6,737.6
61.4%
2,846.7
25.9%
3,890.8
35.4%
2004
7,384
7,333.4
62.8%
3,056.6
26.2%
4,276.8
36.6%
2005
8,184
7,871.0
63.2%
3,301.0
26.5%
4,570.1
36.7%
2006
8,965
8,420.3
63.7%
3,610.4
27.3%
4,809.8
36.4%
2007
9,815a
8,921.3
64.2%
3,903.7
28.1%
5,017.6
36.1%
2008
10,615b
9,960.0
69.2%
4,180.0
29.0%
5,780.3
40.2%
2009
12,104c
11,909.8
84.5%
4,358.0
30.9%
7,551.9
53.6%
2010
14,294d
13,510.8
93.1%
4,585.7
31.6%
9,022.8
62.2%
2011
15,194e
14,746.6
97.7%
4,663.3
30.9%
10,127.0
67.1%
Change during
$405.2 $854.6 $-449.5
FY1998 - FY2001
Change during
$3188.5 $1467.2 $1721.3
FY2002 - FY2007
Change during
$5825.3 $759.6 $5109.4
FY2008 - FY2011
Source: U.S. Department of the Treasury, Financial Management Service, Treasury Bulletin, June 2001 and
December 2006. Bureau of the Public Debt, Monthly Statement of Public Debt, various issues. CRS calculations.
Notes: Amounts held by government accounts and held by the public for FY1996-FY2000 are approximated. 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 subject to a separate limit, from intragovernmental debt.
This calculation 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 for an approximate
measure of debt held by the public subject to limit. Because intragovernmental debt is overestimated, 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 raised to $10,615 billion on July 30, 2008, and to $11,315 billion on October 3, 2008.
c. Debt limit was increased February 17, 2009, to $12,104 billion.
d. Debt limit was increased February 12, 2010, to $14,294 billion.
e. Debt limit increased on August 2, 2011, to $14,694 billion and on September 22, 2011, to $15,194 billion.

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Figure 1. Components of Federal Debt As a Percentage of GDP, FY1940-FY2016

Source: CRS calculations based on FY2012 budget submission.
Notes: FY2011 values are estimated; FY2012-FY2016 values are OMB projections reflecting Administration assumptions and proposals.

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The Debt Limit: History and Recent Increases

Table 2. Increases in the Debt Limit 1993-2011
Change From
New Debt Limit
Previous Limit
Date
Public Law (P.L.) 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
November 19, 2004
P.L. 108-415
8,184
800
March 20, 2006
P.L. 109-182
8,965
781
September 29, 2007
P.L. 110-91
9,815
850
July 30, 2008
P.L. 110-289
10,615
800
October 3, 2008
P.L. 110-343
11,315
700
February 17, 2009
P.L. 111-5
12,104
789
December 28, 2009
P.L. 111-123
12,394
290
February 12, 2010
P.L. 111-139
14,294
1,900
August 2, 2011
P.L. 112-25
16,394e 2,100e
Sources: 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.
e. See discussion in first section of this report. BCA-related increases, divided into three steps ($400 billion on
August 2, 2011; $500 billion on September 22, 2011; and $1,200 billion on January 28, 2012) totaled $2,100
billion.
Federal debt held by government accounts has grown steadily since 1982, in part due to increases
in Social Security taxes passed following recommendations of the 1983 Greenspan Commission,
and reflecting the transition of the baby boom generation into its peak earnings years.59

59 The Social Security Amendments of 1983 (H.R. 1900; P.L. 98-21), enacted April 20, 1983, introduced those
changes. For details, see a summary available on the Social Security Administration’s History website, at
http://www.ssa.gov/history/1983amend2.html.
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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.60 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, in part reflecting strong economic
growth.61 Financial turmoil in 2007 and 2008, however, 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. The future path of federal debt will depend on the pace of economic
recovery as well as policy choices affecting federal spending and revenues.
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.62 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 A, 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

60Federal 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.
61 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.
62 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).
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the fund with interest it would have earned on that debt.63 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
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.64
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.65

63 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.
64 U.S. Department of the Treasury, Treasury News, Treasury Statement on the Debt Ceiling, May 14, 2002.
65 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.
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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.66 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.
Through the rest of February and into May, the Treasury held debt subject to limit $15 million
below the debt ceiling.67 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.68
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.69 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.70 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

66 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.
67 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.
68 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.
69 U.S. Congress, Congressional Budget Office, The Budget and Economic Outlook: Fiscal Years 2005 to 2014,
January 2004.
70 Alan Fram, “Congress May Duck Debt Limit Raise,” Oakland Tribune, June 5, 2004.
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would be exhausted by mid-November.71 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,
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.

71 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.
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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.72 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.
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 2009.73 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. Signs of economic weakness in mid-2011 have
prompted concerns about the strength of the recovery and the possibility of a “double-dip”
recession. President Obama proposed a package of measures aimed at increasing employment on
September 8, 2011.

72 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.
73 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.
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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
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 FY2009.74 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 FY2010.75 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 FY2009.76 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.

74 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.
74 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.
75 Goldman Sachs U.S. Research, “US Daily: The Fiscal 2008 Deficit—Likely to Top $500 Billion,” March 25, 2008.
76 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.
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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.77 Because debt
subject to limit was just $339 billion less than the debt ceiling of $9,815 billion when the Senate
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.78 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.79
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.80 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.81 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.

77 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.
78 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.
79 U.S. Department of Treasury, “Fact Sheet: Proposed Treasury Authority to Purchase Troubled Assets,” Press release
hp-1150, September 20, 2008, available at http://www.treas.gov/press/releases/hp1150.htm.
80 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, (September 29, 2008), p. H10355.
81 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.
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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
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.82 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.83 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.84 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.85 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.86
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

82 CQ Weekly, “Fall 2009 Outlook: Debt Limit Increase,” September 7, 2009, p. 1966.
83 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.
84 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.
85 The Money Market Observer: Wrightson ICAP’s Weekly Newsletter, December 7, 2009.
86 The Money Market Observer: Wrightson ICAP’s Weekly Newsletter, November 30, 2009.
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the U.S. Treasury Department to continue normal debt management operations for two months or
so.87 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.88 In addition, one amendment to
impose certain pay-as-you-go (PAYGO) restrictions was approved on a 60-40 vote.89
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.90 An amendment (S.Amdt. 3302 to S.Amdt. 3299) to
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.”91 The Fiscal Commission issued a report on
December 1, 2010, and several commissioners issued their own fiscal proposals as well.92
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.93 The President signed the measure (P.L. 111-139) on February 12, 2010.
Raising the Debt Ceiling in 2011
On May 16, 2011, U.S. Treasury Secretary Timothy Geithner announced that the federal debt had
reached its statutory limit and declared a debt issuance suspension period, which would allow
certain extraordinary measures to extend Treasury’s borrowing capacity until about August 2,
2011.94 On July 1, 2011, the U.S. Treasury confirmed its view that its borrowing authority would
be exhausted on that day.95

87 Paul Kane, “House Democrats Discard Larger Debt Limit,” Washington Post, December 15, 2009, p. A4.
88 CQ Today Midday Update, “Senate Sends Debt Ceiling Increase to House,” January 28, 2010.
89 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.
90 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
Street Journal
, November 26, 2009, p. A10.
91 Executive Order 13531, “National Commission on Fiscal Responsibility and Reform,” February
18, 2010; 75 FR 7927, February 23, 2010.
92 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.
93 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.
94 Secretary of the U.S. Treasury Timothy Geithner, letter to Majority Leader Harry Reid, dated May 16, 2011,
available at http://www.treasury.gov/connect/blog/Documents/20110516Letter%20to%20Congress.pdf.
95 U.S. Treasury, “Treasury: No Change to August 2 Estimate Regarding Exhaustion of U.S. Borrowing Authority,”
Press release tg-1225, July 1, 2011, available at http://www.treasury.gov/press-center/press-releases/Pages/tg1225.aspx.
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While many of the extraordinary measures have been used by previous Treasury Secretaries, the
funding provided by those measures may buy much less time than in previous debt limit episodes.
Given the size of the FY2011 federal deficit, projected to reach $1,399 billion according to the
latest Congressional Budget Office (CBO) baseline estimates, those extraordinary measures may
provide limited additional time before the federal government becomes unable to meet its
financial obligations.96
Slowing the growth in federal debt by cutting spending had been suggested by some
commentators as a means of avoiding an increase in the debt limit. The scale of required spending
reductions, as of late spring 2011, would likely have approximately equaled total discretionary
spending for the last five months of FY2011, which ended on September 30, 2011.97
On July 15, the U.S. Treasury announced that it had suspended reinvestment in the Exchange
Stabilization Fund, one of the last available extraordinary measures before its borrowing authority
(according to Treasury projections) would be exhausted on August 2.98 One analyst, who had not
expected this step to be taken until August 1, stated that the U.S. Treasury may have less
headroom for cash management than previously anticipated.99 Thus, funding federal operations
could soon become increasingly complicated without a debt limit increase.100 An independent
analysis of Treasury cash flows, based on imputations from past Treasury reports, projects that
from August 3 through the end of the month, cash inflows would total $174.4 billion, about
$134.3 billion less than projected outflows of $306.7 billion.101 Cash flow projections are subject
to significant uncertainties.
Treasury estimates of when the debt limit would begin to bind and how long extraordinary
measures would suffice to meet federal obligations have shifted since the Treasury Secretary’s
January 6, 2011, letter to Congress requesting a debt limit increase. Higher individual income tax
revenues helped expand the headroom between the federal debt and its limit in late April. Sales of
mortgage-backed securities (MBSs) also provided a relatively small amount of additional
headroom. Estimates calculated by others of when Treasury would reach the debt limit and how
long extraordinary measures would extend federal borrowing capacity have typically been close
to Treasury’s estimates.102 Such estimates require analysis of federal spending patterns, the pace
of federal debt redemptions and refinancings, and the inflow of receipts, each of which is subject
to uncertainties.

96 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.
97 For details, see CRS Report R41633, Reaching the Debt Limit: Background and Potential Effects on Government
Operations
, coordinated by Mindy R. Levit. The 2011 debt limit episode is described in the section entitled “Raising
the Debt Ceiling in 2011.”
98 U.S. Treasury, “Update: As Previously Announced, Treasury to Employ Final Extraordinary Measure to Extend U.S.
Borrowing Authority Until August 2,” press release TG-1243, available at http://www.treasury.gov/press-center/press-
releases/Pages/tg1243.aspx.
99 Wrightson ICAP, The Money Market Observer, July 18, 2011.
100 Wrightson ICAP, The Money Market Observer, May 2, 2011.
101 Bipartisan Policy Center, “Debt Limit Analysis,” June 27, 2011, available at http://www.bipartisanpolicy.org/sites/
default/files/Debt%20Ceiling%20Analysis%20FINAL_0.pdf.
102 Wrightson ICAP, The Money Market Observer, May 2, 2011; Secretary of the U.S. Treasury Timothy Geithner,
letter to Majority Leader Harry Reid, dated January 6, 2011, available at http://www.treasury.gov/connect/blog/
Documents/Letter.pdf.
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The Treasury Secretary, in a letter to Congress dated May 2, 2011, had 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 2011.103 Certain measures that rely on the Treasury Secretary’s existing authority, such as
the draw-down of the Supplementary Financing Program (SFP), have already taken place. The
SFP, an initiative intended to help manage monetary policy, had been drawn down from $200
billion to $5 billion to provide additional headroom under the limit.104 New issues of State and
Local Government Series (SLGS) Treasury securities were suspended on May 6, 2011.
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, 2011.105 On April 4, the
Treasury Secretary wrote Congress that estimates indicated that federal debt would reach its limit
between April 15 and May 31, 2011.106 The U.S. Treasury had also previously projected that its
borrowing capacity, even using extraordinary measures, would be exhausted about July 8,
2011.107
A bill (H.R. 1954) to raise the debt limit to $16,700 billion was introduced on May 24 and was
defeated in a May 31, 2011, House vote of 97 to 318. The House passed the Cut, Cap, and
Balance Act of 2011 (H.R. 2560; 234-190 vote) on July 19, 2011. On July 22, the Senate tabled
the bill on a 51-46 vote. The measure would have increased the statutory limit on federal debt
from $14,294 billion to $16,700 billion once a proposal for a constitutional amendment requiring
a balanced federal budget was transmitted to the states.
On July 25, 2011, legislation entitled the Budget Control Act of 2011 was introduced in different
forms by both House Speaker Boehner (House Substitute Amendment to S. 627) and Majority
Leader Reid (S.Amdt. 581 to S. 1323). Subsequently, on August 2, 2011, President Obama signed
into law a revised compromise measure (Budget Control Act; BCA; P.L. 112-25), following
House approval by a vote of 269-161 on August 1, 2011, and Senate approval by a vote of 74-26
on August 2, 2011. This measure included numerous provisions aimed at deficit reduction and an
increase in the debt limit of up to $2.4 trillion that would occur in several stages (see section on
BCA for details). These provisions would eliminate the need for further increases in the debt limit
until late 2012 or early 2013.

103 Secretary of the U.S. Treasury Timothy Geithner, letter to Speaker John Boehner, dated May 2, 2011, available at
http://www.treasury.gov/connect/blog/Documents/FINAL%20Debt%20Limit%20Letter%2005-02-
2011%20Boehner.pdf. The same text was sent to all Members.
104 U.S. Treasury, “Treasury Announces Marketable Borrowing Estimates,” press release TG-1155, May 2, 2011,
available at http://www.treasury.gov/press-center/press-releases/Pages/tg1155.aspx.
105 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.
106 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.
107 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.
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The Coming Trajectory of Federal Debt and Deficits
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 trebled from $455 billion in
FY2008 to $1,413 billion in FY2009, fell slightly to $1,294 billion in FY2010, and nudged higher
to $1,2999 billion in FY2011.108 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.109 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.110 The growth in federal debt held by the public
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. 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.111 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

108 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; Joint Statement of Timothy Geithner, Secretary of the Treasury, and
Jacob Lew, Director of the Office of Management And Budget, on Budget Results for Fiscal Year 2011
, U.S. Treasury
press release TG-1328, October 14, 2011, available at http://www.treasury.gov/press-center/press-releases/Pages/
tg1328.aspx.
109 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.
110 Report of the National Commission on Social Security Reform, January 1983, available at http://www.ssa.gov/
history/reports/gspan.html.
111 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.
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The Debt Limit: History and Recent Increases

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.
Once budget projections were released in 2002, however, expectations of large, persistent
surpluses were smashed and hopes for reductions in debt held by the public collapsed.
The financial crisis of 2007-2009 and the subsequent economic recession led to large federal
deficits that accelerated the growth of total debt, which necessitated a series of debt limit
increases. Past experience suggests that direct fiscal costs of a financial crisis, such as costs of
bailing out financial institutions, is dwarfed by the effects of diminished tax revenues and
elevated social safety net benefits.112 Debate during the 2011 debt limit episode reflected a
growing concern with the fiscal sustainability. 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.

112 Carmen M. Reinhardt and Kenneth S. Rogoff, This Time is Different: Eight Centuries of Financial Folly,
(Princeton: Princeton, NJ, 2009).
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The Debt Limit: History and Recent Increases

Further Reading
Drishnakumar, Anita S., “In Defense of the Debt Limit Statute,” Harvard Journal on Legislation,
vol. 42, 2005, pp. 135-185.
Kenneth D. Garbade, Birth of a Market: The U.S. Treasury Securities Market from the Great War
to the Great Depression,
Cambridge: MIT Press, 2012.
Gordon, John Steele, Hamilton’s Blessing: the Extraordinary Life and Times of Our National
Debt
, New York: Penguin, 1998.
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.
Carmen M. Reinhardt and Kenneth S. Rogoff, This Time is Different: Eight Centuries of
Financial Folly
, Princeton, 2009.
Wright, Robert E., One Nation Under Debt: Hamilton, Jefferson, and the History of What We
Owe
, New York: McGraw-Hill, 2008.
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The Debt Limit: History and Recent Increases

Appendix A. 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 2011, total federal debt increased by $9,014
billion, debt held in government accounts increased by $2,203 billion, and debt held by the public
increased by $6,811 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 2011
(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
Apr. 2003
6,399,975
0
2,731,042
8,230
3,668,933
-8,230
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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
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
Mar. 2006
8,281,451
97,476
3,443,602
-13,807
4,837,849
111,282
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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. 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
Feb. 2009
10,814,630
245,320
4,261,734
-16,690
6,552,896
262,010
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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. 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
Jan. 2011
14,078,501
105,985
4,614,179
10,291
9,464,322
95,697
Feb. 2011
14,142,331
63,830
4,597,775
-16,403
9,544,556
80,233
Mar. 2011
14,217,862
75,531
4,587,082
-10,693
9,630,780
86,225
Apr. 2011
14,235,938
18,076
4,601,684
14,602
9,634,253
3,472
May 2011
14,293,975
58,038
4,591,014
-10,671
9,702,961
68,708
June 2011
14,293,975
0
4,572,152
-18,862
9,721,823
18,862
July 2011
14,293,975
0
4,558,417
-13,735
9,735,558
13,735
Aug. 2011
14,638,920
344,946
4,634,731
76,314
10,004,189
268,631
Sept. 2011
14,746,553
107,633
4,639,427
4,697
10,107,126
102,937
Oct. 2011
14,948,905
202,352
4,712,667
73,239
10,236,237
129,112
Nov. 2011
15,110,499
161,593
4,720,541
7,874
10,389,958
153,720
Dec. 2011
15,180,337
69,838
4,775,277
54,736
10,447,663
57,705
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Sources: U.S. Treasury, Bureau of the Public Debt, Monthly Statement of the Public Debt, Sept. 2001-Nov. 2011,
available at http://www.treasurydirect.gov/govt/reports/pd/mspd/mspd.htm; CRS calculations. Dec. 2011 data
computed from Daily Treasury Statement.
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The Debt Limit: History and Recent Increases

Appendix B. Major Debt Measures Before the Entry
of United States into World War II

Table B-1. Major Federal Debt Measures, 1898-1941
Statutes at Large
Title
Bill
Public Law
30 Stat. 448
War Revenue Act of June 13, 1898
H.R. 10100
n.a.
32 Stat. 481
Spooner Act of June 28, 1902

n.a.
36 Stat. 11
Payne-Aldrich Tariff Act of August 5, 1909
H.R. 1438
P.L. 61-5
40 Stat. 35
First Liberty Bond Act of April 24, 1917
H.R. 2762
P.L. 65-3
40 Stat. 288
Second Liberty Bond Act of September 24, 1917
H.R. 5901
P.L. 65-43
40 Stat. 502
Third Liberty Bond Act of April 4, 1918
H.R. 1123
P.L. 65-120
40 Stat. 844
Fourth Liberty Bond Act of July 9, 1918
H.R. 12580
P.L. 65-192
40 Stat. 1309
Victory Liberty Loan Act of March 3, 1919
H.R. 16136
P.L. 65-328
42 Stat. 227
Revenue Act of November 23, 1921
H.R. 8245
P.L. 67-98
46 Stat. 19
Act of June 17, 1929
H.R. 1648
P.L. 71-11
46 Stat. 775
Act of June 17, 1930
H.R. 1244
P.L. 71-376
46 Stat. 1506
Act of March 3, 1931
H.R. 16111
P.L. 71-820
48 Stat. 337
Gold Reserve Act of January 30, 1934
H.R. 6976
P.L. 73-87
49 Stat. 20
Act of February 4, 1935
H.R. 4304
P.L. 74-3
52 Stat. 447
Act of May 26, 1938
H.R. 10535
P.L. 75-552
53 Stat. 1071
Act of July 20, 1939
H.R. 5748
P.L. 76-201
54 Stat. 516
Revenue Act of June 25, 1940
H.R. 10039
P.L. 76-656
55 Stat. 7
Revenue Act of February 19, 1941
H.R. 2959
P.L. 77-7
Source: Statutes at Large, various volumes, Kenneth D. Garbade, Birth of a Market: The U.S. Treasury Securities
Market from the Great War to the Great Depression
(Cambridge: MIT Press), forthcoming 2012.
Notes: Public law (P.L.) enumeration before the 1930s was not as consistently or commonly used as at present.
Table 7.3 of the FY2012 Budget Historical Tables volume lists measures since 1940 (available at
http://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/hist07z3.xls).
n.a. = not available.

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
33