Much Ado About Debt : The NPR Politics Podcast Treasury Secretary Janet Yellen warned Congress the United States would reach the statutory debt limit — commonly known as the debt ceiling — on Jan. 19. As Congress & the Treasury work to find ways to avoid financial chaos, what potential solutions are available?

This episode: White House correspondent Tamara Keith, and political correspondents Danielle Kurtzleben & Susan Davis.

This episode was produced by Elena Moore and Casey Morell. It was edited by Casey Morell. Our executive producer is Muthoni Muturi. Research and fact-checking by Devin Speak.

Unlock access to this and other bonus content by supporting The NPR Politics Podcast+. Sign up via Apple Podcasts or at

Email the show at
Join the NPR Politics Podcast Facebook Group.
Subscribe to the NPR Politics Newsletter.

Much Ado About Debt

  • Download
  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript

ERICA: Hello. This is Erica (ph) in Philadelphia. I just got the kids off to school, and now I'm headed to my job at the city's parks and rec department. It's not the Galapagos or Hawaii, but this is my life. This podcast was recorded at...


1:42 p.m. on Wednesday, January 18, 2023.

ERICA: Things may have changed by the time you hear it. Here's the show.


KEITH: I am so with you on the lack of glamour.


DANIELLE KURTZLEBEN, BYLINE: I appreciate it when we have people calling us not from beaches. It makes me feel a little - you know, a little more kinship with our listeners.

DAVIS: They're just like us.


KEITH: Listeners - they're just like us. Hey, there. It's the NPR POLITICS PODCAST. I'm Tamara Keith. I cover the White House.

KURTZLEBEN: I'm Danielle Kurtzleben. I cover politics.

DAVIS: And I'm Susan Davis. I also cover politics.

KEITH: The U.S. government could be on the brink of financial chaos. Treasury Secretary Janet Yellen warned Congress this month that, quote, "the outstanding debt of the United States is projected to reach the statutory limit." And that happens tomorrow. Tomorrow, the U.S. bumps up against the debt limit. Disaster will not strike immediately. Yellen is taking what are known as extraordinary measures to keep paying the bills, but that will only work for so long. And if Congress doesn't raise the debt limit in time, the U.S. would default on its debt. Cue the chaos. Danielle, briefly, why do we have this weapon of mass destruction in our system?

KURTZLEBEN: That's a great question because you're right, not a lot of countries have a debt ceiling - only a few do. But we do, and it is a congressional law that says the U.S. can't take out more than a certain amount of debt. Specifically, right now, it is around 31.4 trillion. So that is where our debt ceiling is. And every so often, we have these standoffs in - between Congress and the White House, within Congress, over whether we should raise that. Now, to be clear, this is not the amount that we have agreed to spend. This is the amount we have agreed to borrow. We have already agreed to spend X amount on Social Security, Medicare, military, all sorts of things. This is not the budget. This is - we have agreed to spend - this is the - an analogy that's often used is a credit limit. So, yes, this is - will we allow ourselves to borrow the money to pay the things that we have already agreed to pay?

KEITH: OK. So we mentioned extraordinary measures. Does Janet Yellen go in a phone booth and put on a superhero costume? What is an extraordinary measure, and does it feel extraordinary?

KURTZLEBEN: That would be great, but no. So what has happened - so what happens is this. On Thursday, we technically hit that $31.4-ish trillion mark. But what Janet Yellen and the Treasury can do are these extraordinary measures, which basically means shifting money around saying - from account to account, saying, OK, we will move money from over here where it's not being spent as fast to over here where we need it more. And that can extend us out a few more months. And that is what - the estimate right now, I believe, is that that could last us until maybe early summer, something like that.

KEITH: What are the economic consequences if Congress doesn't act and a default actually happens?

KURTZLEBEN: What happens if we crash into the debt ceiling? Bad things happen. The knock-on effects from hitting the debt ceiling, exceeding the debt ceiling could be huge. First of all, the U.S. government has less ability to spend. So who does it pay? Who doesn't it pay? That means government spending could be reined in, and we don't know exactly how that would work. Second of all, there would be higher interest rates. The short version is this, is that to borrow money, the U.S. Treasury sells Treasury bonds, Treasury notes, etc. It sells those. Investors will start demanding a higher rate of interest on those because suddenly, those investors will look at U.S. debt and say, wait a minute, this is not as safe as I thought it was. You have to give me more interest on this. So the U.S.'s borrowing costs go up.

KEITH: And U.S. debt is not supposed to be risky.

KURTZLEBEN: No, not at all. And that - and so I will get there because there's one more thing on that note. But if the interest rates on these go up, interest rates across the economy go up, spending slows down. Houses, cars, all sorts of things get more expensive. The economy could be in an absolute freefall. The stock market plunges. And finally, what you mentioned about U.S. debt, that it's supposed to be safe - yes. This would be like violating a law of gravity of the global economic system because so many things - it is just taken as a given, worldwide, that U.S. debt is safe, that it is always paid. If it's not, we don't know what would happen, but it - chaos, just chaos.

KEITH: We are talking about lots of disaster and terrible things. But there is actually a very simple solution here, one that has happened dozens of times before, many of those times without any controversy, conversation or really much of anything. Congress just has to vote to raise the debt ceiling. So, Sue, why are we talking about this right now?

DAVIS: Well, I mean, for most of its history, the debt ceiling has been raised without a ton of political brinksmanship. I think, in the modern era, the brinksmanship really started after the 2010 election and the Tea Party wave in Congress, when a new Republican House majority believed they won, demanding structural, fiscal reforms. And they were willing to take the debt limit fight to the brink in order to extract some side budget deal agreements with the Obama administration. Now, on the one hand, it was technically successful at the time. They did extract a separate budget bill that at least had the intention of putting caps on spending over the next decade. But because they flirted - even just flirting with default - getting too close to that deadline can spook the markets. And it did in 2011. You know, there was an impact on the stock market. There was the first-ever downgrade of a U.S. credit rating. So it did have an economic impact, and they didn't even default on the debt then. It's a complicated Washington policy fight that has very dramatic, real-world consequences for everyday people, right?

And so over the past decade, there's been a bunch of debt ceiling fights in Congress. They've had to find circuitous ways to raise it. And under former President Trump, they had to raise the debt limit three times. It was less confrontational then because obviously Republicans are less confrontational with a Republican president in the White House than they are with a Democrat, and now you have a Democrat back in the White House and a new Republican majority. And honestly, a lot of this fight goes back to the speakership. When Kevin McCarthy was trying to win the votes to become speaker, he had to make a lot of promises. And one of those promises to many of the conservatives in his caucus is that they will fight for spending cuts in this Congress because they believe that the debt and the deficits are growing too fast - critics would say that they feel this much more strongly when there's Democrats in the White House - and that their two leverage points are this vote to raise the debt limit and the annual spending process for the annual spending bills that will come up again by the end of September.

KEITH: All right. Well, we are going to take a quick break. And when we get back, some other perhaps fantastical steps that could be taken to prevent a crisis.

And we're back. And Sue, we know that Republicans see the debt ceiling as leverage - at least House Republicans see it as leverage. What do they want to get with it?

DAVIS: That is the question everyone is trying to figure out now. They want it all is basically what they've been saying. They want to drive down annual discretionary spending, which is basically all the money that Congress has to agree to every year. Congress just passed - I believe it was about 1.8 trillion in annual funding for the government. That's discretionary spending. But they don't want to touch the Pentagon, which is about half of that spending. So they want to make steep cuts in domestic spending that affects everything but the Pentagon. Now, that's fine. But you can ask any budget expert anywhere, from far right to far left, and they will tell you that that is a tiny little drop in the bucket of what federal spending actually is.

What drives the federal spending in this country is mandatory spending on the social safety net - Medicare, Medicaid, Social Security. That is the big driving factor of deficit spending, and it's growing bigger and bigger because the country's getting older and older. And as more people retire and need more health care, they get more and more expensive. Now, it's cliche to say that these are the third rail of politics, right? Like, there's a reason why politicians are very, very loathe to try to take these on - because they're very popular. They're very complex. And people get scared really fast.

But there is at least a faction of the House Republican Conference - and I frankly don't even know if it's a majority of them. They're going to have to decide amongst themselves before they can even fight with Democrats. They want to rein in these programs, that want to find ways to reduce the cost of mandatory spending because that is truly the only way. If balancing the budget and reducing federal spending long-term is your goal, there is no other path than going through entitlements. But, as I've been reporting on this, as I know Danielle has, budget hawks will also tell you linking this to a debt ceiling fight is a dangerous budget practice. Like, flirting with a default because you're trying to extract broader budget reforms is really politically risky and potentially very politically dangerous, especially because, look, it's divided government. Democrats...

KEITH: Yeah.

DAVIS: ...Control the Senate. President Biden's in the White House. Like, their interest in signing Republican-backed legislation to overhaul entitlements I think it's safe to say is zero.

KEITH: Let me just put my White House correspondent hat on here really quickly to say that the current White House position, as has been the White House position for months and months and months, is that the debt ceiling needs to be raised with no preconditions - full stop. I don't know if that is a position that they can stick to forever, but that is the current position. And I will say that President Biden, when he was vice president, was very involved in brokering the last time this thing came to an end, the last time there was this crisis around the debt ceiling back in the Obama administration. And he may have learned a few lessons.

DAVIS: Look, this is really hard politics, especially for new Speaker Kevin McCarthy because on the one hand, he is out there saying, look, we will not default on the debt. The Republican Party is going to be responsible, and they're not going to mess with the economy. And in the same breath, he's saying, but we will not settle for anything that doesn't cut spending. And those are two very difficult positions to reconcile up against Democratic opposition. And I'd also say it might not just be Democrats. The enthusiasm to potentially take on some entitlement spending questions among House Republicans, I think it is generally not shared by Senate Minority Leader Mitch McConnell. Even if he shares some of the policy goals, he has long said that he does not think things like entitlement reform can be pushed without bipartisan support and bipartisan buy-in and that parties that try to do it on their own, you know, tend to feel the burn.

KEITH: Danielle, I do want to get to your reporting. You did - had a great story that was on the radio - also on, if people want to read in. You looked into things that could be done to deal with the debt ceiling that don't involve, you know, a straight up vote in Congress with Kevin McCarthy putting it on the floor. So let us go with the first one - a discharge petition.

KURTZLEBEN: Right. Yes. And I want to preface all of these by saying the spoiler here is this - is that all of these are anywhere from difficult to potentially illegal. We don't...


KURTZLEBEN: We just don't fully know. They're all untested or largely untested, and they all have some significant drawbacks.

KEITH: So what's a discharge petition?

KURTZLEBEN: A discharge petition is a very rarely used - but has been used - house procedure that essentially pushes a bill out of a House committee and gets a vote on it. So if a bill has been sitting in committee - so if the bill is, for example, to raise the debt ceiling - if the bill has been sitting in committee for long enough, 218 House members can sign a petition that would push the bill out of committee and get it onto the floor for a vote. And the idea here is that congressional Democrats would sign on to it and perhaps some members of the House Republican caucus would also sign onto it. And then, after a few more days, everybody would vote. But there are a lot of steps. It has to be sitting in committee for 30 legislative days, which is not necessarily calendar days. It could be much longer. It could even, by some estimates, be a couple months. So it has to sit in committee for maybe a couple months and then get all those signatures - which could take a while - and then sit around for a few more days and then try to get the votes on it.

KEITH: So Sue, how practical is this?

DAVIS: It's possible, but highly impractical. I think there's only been two successful discharge petitions used in the last 20 or 30 years. And you also have to think of a discharge petition as essentially declaring war on party leaders - right? - because it is the maneuver in which you can force the hand of committee chairs, of your party leadership - who gets to decide what goes on the floor - and overrule all of it. It is tactically very specific but also politically very dangerous. And I think to get to a point where a discharge petition was the only way out would mean that it was a rather catastrophic circumstance on Capitol Hill.

KEITH: Danielle, there are a couple of other ideas that you've written about, including the 14th Amendment, which guarantees the validity of public debt. That hasn't been tested. And then there's the one - the one that everybody talks about, where you can't tell if they are joking or serious. I will just call it the coin.

KURTZLEBEN: It's a - usually a little bit of both. Yeah.


KEITH: Minting the coin. OK. So what is the minting-the-coin option?

KURTZLEBEN: Yes. OK. Minting the coin - so this is an idea that popped up in 2011 during that huge debt ceiling fight. And the origin appears to have been a blog comment - no joke. This idea relies on a provision in the U.S. Coinage Act. And that provision says that the secretary of the Treasury may, quote, "mint and issue platinum bullion coins" and proof platinum coins in accordance with such specifications, designs, varieties, quantities, denominations and inscriptions as the secretary, in the secretary's discretion, may prescribe," etc., etc. So basically, what they're saying is, hey, every so often the secretary of the Treasury can print whatever kind of coins they feel like in whatever denominations they feel like. This was intended for commemorative coins. This was not intended for the debt ceiling.

But the very out-there idea is that, OK, the secretary of the Treasury can say, hey, Mint, make a trillion-dollar coin, then take the coin to the Fed, deposit it at the Fed, and boom, you have a trillion dollars in the Treasury's account essentially to pay it. I laugh, but - look, clearly this is an untested idea. There are so many potential legal and logistical issues with it that we don't have time to get into, but I could go on for forever. But the thing to remember here and with the 14th Amendment and with even payment prioritization - which is something that congressional Republicans are kicking around - is that even if any of these ideas were for sure legal or logistically possible and we knew that, that still doesn't mean there wouldn't be economic consequences because if - U.S. investors would look at that and say, OK, maybe I'll get paid on my bonds for now, but I'm not sure I'm going to get paid on them in the future. And still, interest rates would go up. Still, things go off the rails.

KEITH: Yeah. I mean, people would say, wow, the U.S.? Hmm...


KEITH: ...They are not reliable. I do not trust the full faith and credit...

KURTZLEBEN: Correct. I...

KEITH: ...Of the United States if they're just printing coins. And what if somebody dropped it on the way to the Treasury?

KURTZLEBEN: Yes. And Janet Yellen - the last time this was brought up - called it a gimmick and dismissed it. I mean, this is not something I expect Janet Yellen or Joe Biden to get behind.

KEITH: All right. We're going to leave it there for today. I'm Tamara Keith. I cover the White House.

KURTZLEBEN: I'm Danielle Kurtzleben. I cover politics.

DAVIS: And I'm Susan Davis. I also cover politics.

KEITH: And thank you for listening to the NPR POLITICS PODCAST.


Copyright © 2023 NPR. All rights reserved. Visit our website terms of use and permissions pages at for further information.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.