On Monday, House Minority Whip Rep. Steny Hoyer (D-Md.) talked to reporters about Speaker John Boehner and what action the Republican House is likely to take on the debt ceiling:
“Speaker Boehner has made it very clear he thinks defaulting on the debt would have very detrimental consequences, yet he continues to have members to talk about it as an option for negotiations.”
On Monday, Treasury Secretary Timothy Geithner made it clear that Congress must act to avoid default, which could occur as early as mid-February:
In a letter to House Speaker John Boehner, R-Ohio, and other key leaders in the House and Senate, Geithner said that the Treasury Department is already taking "extraordinary measures" to fulfill the nation's financial obligations.
However, Geithner warned those steps would run out sometime between mid-February and early March, with a more precise estimate to be issued later.
"Any estimate, however, will be subject to a significant amount of uncertainty because we are entering the tax filing season, when the amounts and timing of tax payments and refunds are unpredictable," Geithner said.
He added, "For this reason, Congress should act as early as possible to extend normal borrowing authority in order to avoid the risk of default and any interruption in payments."
If the debt ceiling is not increased, Geithner said that the country would be forced to try to pay its bills only with the cash it has on hand on any given day, warning of dire consequences if the government is forced to go that route.
"The U.S. government makes approximately 80 million separate payments per month," Geithner said. "These include payments for Social Security; Supplemental Security Income; Medicare; Medicaid; national security needs, including military salaries, military retirement, veterans' benefits, and defense contractors; income tax refunds; federal employee salaries and retirement; law enforcement and operation of the justice system; unemployment insurance; disaster relief; goods and services sold to the government under contracts with small and large businesses; and many others."
He added, "If Congress does not act to extend borrowing authority, all of these payments would be at risk. This would impose severe economic hardship on millions of individuals and businesses across the country."