https://www.wsj.com/articles/default-on-u-s-debt-is-impossible-deficit-treasury-cbo-janet-yellen-supreme-court-constitution-public-debt-clause-federal-reserve-328dafe5
https://sgp.fas.org/crs/misc/R44704.pdf
https://www.brookings.edu/2023/04/24/how-worried-should-we-be-if-the-debt-ceiling-isnt-lifted/
https://www.cato.org/blog/debt-ceiling-unconstitutional-what-about-default
https://www.taxpolicycenter.org/taxvox/day-united-states-defaulted-treasury-bills
https://www.cbpp.org/research/federal-budget/debt-limit-default-is-default-even-under-a-prioritization-scheme
https://www.whitehouse.gov/cea/written-materials/2023/05/03/debt-ceiling-scenarios/#_ftn1
https://www.wsj.com/articles/default-on-u-s-debt-is-impossible-deficit-treasury-cbo-janet-yellen-supreme-court-constitution-public-debt-clause-federal-reserve-328dafe5
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https://www.brookings.edu/2023/04/24/how-worried-should-we-be-if-the-debt-ceiling-isnt-lifted/
One cannot predict how
Treasury will operate when the debt limit binds,
given that this would be unprecedented.
Treasury did have a contingency plan in place in 2011
when the country faced a similar situation,
and it seems likely that Treasury would follow the contours of that plan if the debt limit were to bind this year.
Under the 2011 plan, there would be
no default on Treasury securities.
Treasury would continue to pay interest
on those Treasury securities as it comes due.
And, as securities mature,
Treasury would pay that principal
by auctioning new securities for the same amount (and thus not increasing the overall stock of debt held by the public).
Treasury would delay payments for all other obligations until it had at least enough cash to pay a full day’s obligations. In other words, it will delay payments to agencies, contractors, Social Security beneficiaries, and Medicare providers rather than attempting to pick and choose which payments to make that are due on a given day.
https://www.cbsnews.com/news/debt-limit-x-date-could-arrive-within-weeks-new-analysis-finds/
If the U.S. can make it through the first half of June, it is slated to receive an influx of cash around June 15 with the quarterly filing deadline. That money could help the Treasury Department hold off a default through the end of the month.
Another roughly $145 billion in additional so-called extraordinary measures is set to become available June 30. If that all holds up, the Treasury Department should have enough room to pay the bills through at least early July and perhaps several weeks beyond that, the Bipartisan Policy Center projects.
