The development of such a scenario, according to the American Center for bipartisan policy, perhaps due to a lower than expected inflow of tax revenues. To avoid default, the authorities need to raise the debt ceiling.
According to experts from the Washington non-profit Bipartisan Policy Center (BPC), the date when the US Federal government will no longer be able to pay all its bills in full and on time (“day X”) may come in the first half of September. This is stated in the release on the website of the American organization.
According to the statement of the representatives of the center, the experts came to the relevant conclusions on the basis of the analysis of the latest data. The risk of default, said the Director of the economic policy of the center Shai Akabas, may increase if Federal revenues decrease. Default then, analysts believe, may occur in the first two weeks of September. Experts attribute this to lower than expected tax revenue forecasts.
In general, according to the release, the growth of Federal revenues of the States for 2019 was “sluggish” and amounted to less than 3% (it was assumed that it will be 6%). Lower-than-expected corporate income tax charges appear to have been associated with tax cuts in 2017, the report said.
Before BPC experts, reminds Bloomberg, predicted that “day X” for the United States may come in the period from October to November. “The new analysis [of the situation] revealed a dangerous scenario that cannot be ignored,” said Akabas, commenting on the new data. “Participants in the budget negotiations should know: time is running out,” he added, assuring that at the moment the only way to exclude the possibility of default this year for the United States is to extend the repayment of the national debt in the coming weeks.”
To this end, the experts recommended that the authorities intensify negotiations on this issue with the US Congress.