QUESTION:
What is the U.S. debt ceiling?
ANSWER:
The debt ceiling is the maximum amount of money the United States can borrow cumulatively by issuing bonds.
If the national debt levels bump up against the ceiling, the Treasury Department must resort to other extraordinary measures to pay government obligations and expenditures until the ceiling is raised again. This can result in government shutdowns, as we saw in 2018 and 2019.
The debt ceiling has been raised or suspended numerous times over the years to avoid the worst-case scenario:
a default by the U.S. government on its debt.