Jessica Noviskis, CFA
The U.S. debt ceiling was initially established in 1917 as a limit on how much the federal government was allowed to borrow. At the time, the ceiling was enacted to simplify the borrowing process, but more recently, it has become a political tool that can threaten the stability of our economy and financial markets. Modifying the debt ceiling began as a routine act of Congress — there have been more than 100 changes to the debt limit since the end of World War II, with “clean” increases enacted under both Democratic and Republican leadership. Since 1980, however, increases to the debt ceiling have been increasingly intertwined with partisan spending and deficit reduction initiatives, with the eleventh-hour agreement in 2011 the most extreme example to date of how far parties are willing to go.
This newsletter places the 2023 debt ceiling crisis into historical context, analyzing what outcomes are likely from here and potential impacts on the government, markets, businesses, and consumers.
Research alerts keep you updated on our latest research publications. Simply enter your contact information, choose the research alerts you would like to receive and click Subscribe. Alerts will be sent as research is published.
We respect your privacy. We will never share or sell your information.
If you have questions or need further information, please contact us directly and we will respond to your inquiry within 24 hours.Contact Us >