The United States will reach the statutory debt ceiling on December 31, 2012, Treasury Secretary Tim Geithner announced in a letter to Congress on Wedneday. The federal government will then begin taking a series of “extraordinary measures” as authorized by law to postpone a default on its debt, creating an additional $200 billion in headroom in order to provide Congress with the necessary time to raise the ceiling once more.
Geithner notes that the specific timeframe remains unclear given that allowing a set of automatic tax increases and spending cuts known as the “fiscal cliff” to take effect would actually prolong that period, adding that he would “provide more guidance” in the future.
Read the full letter, addressed to House and Senate leaders, here.
