On Feb. 12, 2010, President Barack Obama signed a law increasing the legal limit on the national debt from $12.394 trillion to $14.294 trillion.
That gave the U.S. Treasury the legal authority to go out and borrow an additional $1.9 trillion -- about another $16,165 per American household.
By the close of business on Monday, the Treasury had almost finished borrowing all that. The portion of the national debt subject to $14.294 trillion limit stood at $14.246886 -- leaving the Treasury another $47.114 billion in borrowing authority before hitting the legal limit.
In a letter to Senate Majority Leader Harry Reid last month, Treasury Secretary Timothy Geithner said: "The Treasury Department now projects that the debt limit will be reached no later than May 16, 2011."
But Geithner also said in that letter there were "extraordinary measures" he could take to push back the day of reckoning.
One of these is particularly symbolic of the way the federal government handles taxpayers' money.
One thing he could do, Geithner told Reid in an appendix to his letter, was determine "that a 'debt issuance suspension period' exists, which would permit the redemption of existing, and the suspension of new, investments in the Civil Service Retirement and Disability Fund (CSRDF)."
Geithner spelled out what this means in the obscure lexicon of Treasury wonks.
"The CSRDF provides defined benefits to retired and disabled Federal employees covered by the Civil Service Retirement System," wrote Geithner. "The fund is invested in special-issue Treasury securities, which count against the debt limit. Congress has given Treasury statutory authority to take certain actions in the event of a debt limit impasse. Specifically, the statute authorizes the Secretary of the Treasury to determine that a 'debt issuance suspension period' exists and, once he has done so, Treasury can (1) redeem certain existing investments in the CSRDF, and (2) suspend new investment."
In plain English, this means Treasury can temporarily stop counting the debt it is accruing by spending money that belongs to the Civil Service Retirement and Disability Fund, and it can take debt it has already piled up from that fund and temporarily pretend it is not debt.
What ordinarily happens is this: Federal workers in the Civil Service Retirement System pay money to the Treasury that the Treasury turns around and disburses to help pay the general expenses of the government. In return, Treasury gives the CSRDR "intra-governmental" bonds in the amount it spent. These intra-governmental bonds count as part of the national debt subject to the $14.294 trillion limit.