Statement of Administration Policy: H.R. 5355 - Debt Limit Increase

Sent to Rules 7/30
Sent to House 7/31 (unchanged)
(House Rules)
(Rostenkowski (D) IL)

The Administration supports enactment of H.R. 5355, which would increase the public debt limit from $3,122.7 billion to $3,444 billion. The Administration urges that legislation to increase the debt limit be enacted without amendment.

The Administration estimates that the debt limit increase contained in H.R. 5355 would be sufficient to meet the Government's borrowing needs through June 30, 1991.

A default would almost certainly occur on August 15 if the debt limit is not increased. Failure to enact a debt limit increase by August 13 would prevent the Treasury from auctioning securities on August 14 and settling on August 15.

An auction of Treasury securities is scheduled to be announced on August 1. Failure to enact a debt limit increase by that date would compress the time period for distributing those securities. This would raise the cost of Treasury borrowing, all other things being equal. The cost of the delay would grow with its length.