The "very best people" of the Trump administration are not very good at managing money.
Treasury Secretary Steven Mnuchin released a notice to House Speaker Nancy Pelosi that the nation will hit the debt ceiling earlier than anticipated--in early September--and that he needs Congress to vote to raise the debt ceiling before they leave for their 6-week summer recess on July 26th.
In a letter to Democratic House Speaker Nancy Pelosi, Mnuchin wrote that the US might default on its obligations as soon as early September, before Congress returns from its summer recess.
"Based on updated projections, there is a scenario in which we run of out cash in early September, before Congress reconvenes," Mnuchin wrote in a letter.
The federal government has not been able to borrow money since March, when congressionally-mandated borrowing limits went back into force. The US Treasury, which is facing a growing deficit thanks in part to President Donald Trump's 2017 tax cuts, had said it had enough cash to last until the fall.
There are some economists warning that Mnuchin's projections are based on possible, but not likely, scenarios. It is just as likely that Mnuchin is framing the risk as such to pressure the Democrats to not use the debt ceiling vote as leverage for more serious spending cap negotiations, counting on the Democrats' sense of responsibility to not cause a global financial crisis.
