Although the US has raised its debt ceiling many times before 2011,[128] these increases were

not generally coupled with an ongoing global economic crisis.[citation needed]

 

December 16, 2009: The debt ceiling was exceeded. To avoid default, the Treasury Department used "extraordinary accounting tools" to enable the Treasury to make an additional $150 billion available to meet the necessary federal obligations.[128] February 12, 2010: Increase in the debt ceiling signed into law by President Obama, after being passed by the Democratic 111th United States Congress. It increased the debt ceiling by $1.9 trillion from $12.394 trillion to $14.294 trillion.[36][129] February 18, 2010: Obama issued an Executive Order to establish the National Commission on Fiscal Responsibility and Reform, also known as the Bowles-Simpson Commission. The mission of the Commission was to propose recommendations designed to balance the budget, excluding interest payments on the debt, by 2015. It was tasked to issue a report with a set of recommendations by December 1, 2010.[30] November 2, 2010: The Republican Party gained 63 seats in the US House of Representatives in the United States midterm elections, recapturing the majority by 242– 193 in the 112th Congress.[130] Major planks for the House Republicans during the election campaign were cutting federal spending[131] and stopping any tax increases.[132] December 1, 2010: The Bowles-Simpson Commission on Fiscal Responsibility and Reform issued its report, but the recommendations failed to win support of at least 14 of the 18 members necessary to adopt it formally.[133][134] The recommendations were never adopted by Congress nor President Obama. January 6, April 4, and May 2, 2011: Secretary of the Treasury Timothy Geithner sent letters requesting an increase in the debt ceiling.[38][135][136] January 25, 2011: Senator Pat Toomey introduces the Full Faith And Credit Act bill[50] [S.163[49]] that would require the Treasury to prioritize payments to service the national debt over other obligations. The bill was never debated. January 28, 2011: Moody's Investors Service said it may place a "negative" outlook on the AAA rating of US debt sooner than anticipated, as the country's budget deficit widened.[137] February 14, 2011: Obama released his budget proposal for fiscal year 2012.[138] Republicans criticized the budget for doing too little to rein in the burgeoning US deficit.[139] The CBO analysis, released in April 2011, estimated that the budget would increase total deficits over 10 years by $2.7 trillion: from $6.7 trillion of the March 2011 baseline to $9.4 trillion with the proposed budget.[140] The Senate rejected the budget proposal on May 25, 2011 (see below). April 14, 2011: Both the House of Representatives and the Senate voted in favor of the 2011 US federal budget, 260–167 and 81–19 respectively. This budget projected the 2011 deficit to be $1.645 trillion, and therefore ensured that the debt ceiling would be hit during this fiscal year. April 15, 2011: On a party-line vote 235–193, the House of Representatives passed the Republican 2012 budget proposal aimed to reduce total spending by $5.8 trillion and reduce total deficits by $4.4 trillion over 10 years compared to the current-policy baseline.[141] It included reform to Medicare and Medicaid entitlement programs, which the Democrats criticized as an attempt to leave seniors and poor holding the bag on health care costs. The criticism resonated with the many in the public, who voiced opposition to

2011 (see below). 2011: Standard & Poor's Ratings Services revised its outlook on the US to negative due to recent and expected further deterioration in the US fiscal profile." Even had it passed Congress.            the proposed changes. failed by a vote of 97–318. which would have raised the debt ceiling by $2. 2011: The House voted on a bill to raise the debt ceiling without any spending cuts tied to the increase. and of the ability and willingness of the US to soon reverse this trend.[150] Senate Majority Leader Harry Reid called the Act "one of the worst pieces of legislation to ever be placed on the floor of the United States Senate. Cap and Balance Act bill achieved in the House vote. directing the Treasury to utilize "extraordinary measures" to fund federal obligations. it was sent to the Senate for consideration. 181 Democrats and 9 Republicans 'against'. and the Obama budget proposal.[32] May 16. 2011: The Senate rejected both the Republican House budget proposal. and other leaders of Congress. Cap and Balance Act (H. 2011: Obama and Speaker of the House John Boehner addressed the nation separately over network television with regards to the debt ceiling. Republican Speaker of the House John Boehner. The Bill authorized that the debt ceiling be raised by $2. Cap and Balance Act.[147] July 19. Treasury Secretary Timothy Geithner issued a debt issuance suspension period.[149] July 22. 2011: The Senate voted along party lines to table the Cut.4 trillion. by a vote of 57–40. They passed the bill by a vote of 234–190. President Obama asked Congress to raise the debt ceiling in a 'clean' vote that included no other conditions. 2011: The bond market is shaken by a single $850 million futures trade betting on US default.[3] May 18. With the negative outlook. 2011: The Republican Majority in the House brought the Cut.[9] July 25. Democrats accused Republicans of playing politics by holding a vote they knew would fail. in an effort to continue the talks. a vote for a Balanced Budget Amendment would require more support than the Cut.[144] May 25.[152] July 25. Cantor said that these talks would lay the groundwork for further discussions between President Obama.[142] The Senate rejected the budget proposal on May 25. 2011: Republicans and Democrats outlined separate deficit-reduction proposals. 2011: Vice President Joe Biden and four Democratic lawmakers begin meeting with the Republican House Majority Leader Eric Cantor and the Republican Senate Minority Whip Jon Kyl. Obama had promised to veto the bill.4 trillion after a Balanced Budget Amendment was passed by Congress.[148] their proposed solution to the crisis. 51 Democrats voting to table it and 46 Republicans voting to bring it to a debate. by a vote of 97–0.2560). 2011: Bipartisan deficit-reduction talks among the "Gang of Six" high-profile Senators are suspended when Republican Tom Coburn drops out.[146] June 23. . 2011: Biden's negotiations on the debt ceiling were cut off when both Eric Cantor and Jon Kyl walk out over disagreements on taxes.[143] May 24. 2011: The debt ceiling is reached.R.[145] May 31. The bill. April 18. Since Constitutional amendments require a twothirds majority vote in both chambers of Congress to pass. split closely along party lines: 229 Republicans and 5 Democrats 'for'.[151] July 25. S&P believed there is a likelihood of at least one-in-three of a downward rating adjustment within two years. to a vote.

Separately.[154] It allows the President to request a second increase in the debt ceiling of up to $1.[109][112] deciding that the budget plan that was passed did not go far enough to address the country's debt. who deemed it insufficiently tough on spending cuts. to be written by a new "joint committee of Congress.6 trillion upon passage of the balanced-budget amendment and a separate $1. 19 Republicans. 174 Republicans and 95 Democrats voted 'yes'. passed in the House on a vote of 218–210. and 1 independent voted 'yes'. . thus ending fears of a default. 2011: The House passed a bipartisan bill by a vote of 269–161.[153] a Republican bill that immediately raised the debt ceiling by $900 billion and reduced spending by $917 billion.8 trillion deficit reduction package. 28 Republicans. thus triggering a technical sovereign default if the debt ceiling crisis had not been resolved.[161] President Obama signed the debt ceiling bill the same day. No Democrats voted for it. 2011: The Senate passed the bill by a vote of 74–26. 627. if the debt ceiling crisis were not resolved. 2011: The date estimated by the Department of the Treasury that the borrowing authority of the US would be exhausted.[3] August 5. and 1 independent voted 'no'. 66 Republicans and 95 Democrats voted 'no'.[157] July 31."[155] Upon introduction into the Senate in the evening. House Speaker John Boehner told Republicans that they had reached the framework for an agreement. 2011: The date estimated by the Fitch rating agency and the FRBNY primary dealer Jefferies & Co that $29 billion of federal debt interest would have become due. the bill was immediately tabled on a 59–41 vote. including some Republican votes. 2011: Standard & Poor's lowered the credit rating of the United States from AAA to AA+.[156] July 30. 2011. did not occur as the debt ceiling crisis was resolved by then. 2011: The Budget Control Act of 2011 S. however.[160] August 2. (Reuters) The Dow Jones Industrial Average and the New York Stock Exchange as well as other world stock markets. 45 Democrats. This. 6 Democrats.[163] August 9.[159] August 1.[158] Boehner revealed details of the agreement in a presentation to the House Republicans. 2011: The House of Representatives voted 173–246 to defeat Senate Majority Leader Harry Reid's $2.         July 29. and it also drew 'no' votes from 22 Republicans. 2011: President Barack Obama announced that leaders of both parties had reached an agreement to lift the debt ceiling and reduce the federal deficit.4 trillion plan to reduce the deficit and raise the debt ceiling. (Wall Street Journal) August 15."[162] August 2. The US Federal Reserve announced it will keep interest rates at "exceptionally low levels" at least through mid 2013. Obama also declared that the bill is an "important first step to ensuring that as a nation we live within our means. recovered after recent falls. It also warned that it is pessimistic about the nation's fiscal outlook. it made no commitment for further quantitative easing.

Sign up to vote on this title
UsefulNot useful