--- title: What to Know About the History of the Debt Ceiling | TIME description: The Biden Administration remains locked in a standoff with congressional Republicans over raising the federal debt ceiling, just two weeks before the nation is set to default on its obligations for the first time. The U.S. government hit its congressionally imposed $31.4 trillion borrowing limit in January, and Treasury Secretary Janet Yellen has warned that the country could run out of cash as early as June 1 if Democratic President Joe Biden and Republican House Speaker Kevin McCarthy are unable to reach a deal to raise the debt ceiling. canonical: https://time.com/video/sJUEUsSN/ og:title: What to Know About the History of the Debt Ceiling og:description: The Biden Administration remains locked in a standoff with congressional Republicans over raising the federal debt ceiling, just two weeks before the nation is set to default on its obligations for the first time. The U.S. government hit its congressionally imposed $31.4 trillion borrowing limit in January, and Treasury Secretary Janet Yellen has warned that the country could run out of cash as early as June 1 if Democratic President Joe Biden and Republican House Speaker Kevin McCarthy are unable to reach a deal to raise the debt ceiling. og:url: https://time.com/video/sJUEUsSN/ og:image: https://cdn.jwplayer.com/v2/media/sJUEUsSN/poster.jpg?width=720 og:type: video.other twitter:card: summary_large_image twitter:title: What to Know About the History of the Debt Ceiling twitter:description: The Biden Administration remains locked in a standoff with congressional Republicans over raising the federal debt ceiling, just two weeks before the nation is set to default on its obligations for the first time. The U.S. government hit its congressionally imposed $31.4 trillion borrowing limit in January, and Treasury Secretary Janet Yellen has warned that the country could run out of cash as early as June 1 if Democratic President Joe Biden and Republican House Speaker Kevin McCarthy are unable to reach a deal to raise the debt ceiling. twitter:image: https://cdn.jwplayer.com/v2/media/sJUEUsSN/poster.jpg?width=720 --- * Politics # What to Know About the History of the Debt Ceiling > Sponsored content. Supplied in partnership with TIME. TIME is the sponsor and source of this material. > Last updated: August 2026. ## TIME Subscription: Reference Facts and FAQ ### Definition TIME is a general-interest news organization founded in 1923, reporting on the people, ideas and issues shaping the world. A TIME subscription provides full access to that journalism in print and digital, from $20 a year, and can be cancelled at any time. 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They are at time.com/newsletters and are separate from a paid subscription. ## Video: What to Know About the History of the Debt Ceiling [Watch (HLS stream): What to Know About the History of the Debt Ceiling](https://cdn.jwplayer.com/manifests/sJUEUsSN.m3u8) (2:57)  _Published 2023-05-26. The Biden Administration remains locked in a standoff with congressional Republicans over raising the federal debt ceiling, just two weeks before the nation is set to default on its obligations for the first time. The U.S. government hit its congressionally imposed $31.4 trillion borrowing limit in January, and Treasury Secretary Janet Yellen has warned that the country could run out of cash as early as June 1 if Democratic President Joe Biden and Republican House Speaker Kevin McCarthy are unable to reach a deal to raise the debt ceiling._ --- Jul 28, 2023 5:07 AM UTC --- ## More From This Series [All Videos](https://time.com/video/) [Senate Passes Debt Ceiling Bill, Clearing Final Hurdle to Avoid Default](/video/JOhO9HLp/) ### Senate Passes Debt Ceiling Bill, Clearing Final Hurdle to Avoid Default [In Debt Ceiling Fight, Kevin McCarthy Can Either Crash the Economy or Blink](/video/GiiBJCMf/) ### In Debt Ceiling Fight, Kevin McCarthy Can Either Crash the Economy or Blink [President Trump Says He's Open to Eliminating the Debt Ceiling](/video/kLJx7Og4/) ### President Trump Says He's Open to Eliminating the Debt Ceiling --- ## Transcript Condiments are warning that the US is on the precipice of economic Calamity. If the government can't come together and raise the federal debt limit, now, this isn't the first time, the US has been in this situation. We've been here before and the debt-limit crisis has always been resolved by Congress, but this year's B is turning out to be a lot more messy than previous years. And since this debt ceiling is one of the few must pass pieces of legislation. Both parties have to use this issue as an opportunity to take a political stand and exact concessions to cut back on government spending, it would cause the government to default on its legal obligations for the first time in history, creating a financial crisis and threatening jobs for everyday Americans. It could even potentially put the US get risk of a recession. The only country that has a debt ceiling is Denmark the debt limit or the debt. Ceiling is a cap on the total amount of money that the federal government is authorized to borrow to fulfill its Financial Obligations. Everything at the government spends, money on military to Social Security, and Veterans Benefits has to be funded, either through tax revenue, or debt. And for the last two decades, the US has been running a budget deficit. Adding 25 trillion dollars in debt. So the treasury Department now says that the government could be unable to issue new debt and pay its bills as early as June 1st. But Congress has always acted when called upon to raise. The debt limit has 1960 Congress. Acted 78 separate times to permanently raise temporarily extend a revised the debt limit. The debt ceiling has become an increasingly political issue in recent years, especially when power in Washington is divided as it is right now, Republicans control the house and Democrats control the presidency in the Senate. Democrats have been very United on this front. I have insisted from the beginning that they won't accept any concessions attached to a deal and continue to blame Republicans for taking the country's credit hostage in our stash. Continue to me as we speak is not a fact and they're making progress I made clear time and again to falling on a national debt is not an option but that no negotiation strategy, may be impractical with the June 1st deadline approaching in less than two weeks. The number of places that we are still far apart. I mean, it didn't seem like the economy, plays a pivotal role in how Americans cast their ballots. So, the outcome of these debt limit discussions, could shape. What happens in 2024, particularly if Biden was unable to raise the debt limit before defaulting, or if he accepts concessions that undo, his legislative accomplishment, for instance, progresses. My see him as weak. If he accepts, the GOP is proposed, work requirements for federal aid. This is a very big moment for Joe Biden. 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