If, like me, you were wondering what sort of crisis it is, exactly, that the ongoing negotiations in Washington are attempting to avoid, here’s a handy primer:
It turns out that the US has already hit its “debt ceiling” – meaning it can’t borrow any more money – and August 2 is when it will, in a practical sense, actually run out of the stuff. It’s at that point that the Treasury would have to start making decisions on who gets paid what, and inevitably some groups of people – like retirees or soldiers or zookeepers (I don’t imagine zookeepers account for very much of federal spending but who knows? Lotta zoos) – would end up not getting paid. What will not happen is for anyone who is owed money by the US (say, a bondholder) not to receive their interest payments: that would result in another econopocalypse.