The Treasury Department said Wednesday that it has resumed borrowing now that Congress has approved a temporary measure that allows the government to take on billions of dollars in debt to fund its most basic operations.
Treasury said that $31 billion of the $41.3 billion that it borrowed since the suspension kicked in on Monday went to restoring two government employee pension funds. Treasury had moved money over from those funds to avoid breaching the $16.4 trillion borrowing limit.
President Barack Obama signed legislation Monday that would temporarily suspend the $16.4 trillion limit on federal borrowing until May 19. Experts say that will allow the government to borrow about $450 billion to meet interest payments and obligations like Social Security benefits and government salaries.
Once the suspension of the debt ceiling ends, Treasury said it would resume using extraordinary measures such as tapping the government employee pension funds. Those bookkeeping maneuvers create about $200 billion in headroom which would allow the government to keep operating possibly into August before the threat of another default.
A group of 15 Republican House members has written a letter to Treasury arguing that the extraordinary measures will not be available in May. But Treasury officials said they disagreed with that interpretation and will lay out in a response the reasons they believe those bookkeeping maneuvers can be used starting in mid-May.
Matthew Rutherford, Treasury assistant secretary for financial markets, refused to give an estimate of how long the extraordinary measures would last. He urged Congress to pass a longer-term debt limit increase before the May deadline is reached.
Treasury said it expected to borrow $331 billion in the current January-March quarter and an additional $103 billion in the April-June quarter. The government's borrowing needs are normally lower in the April-June quarter because of the income received from the filing of individual and corporate tax returns.
As part of the borrowing this quarter, Treasury said it would auction $32 billion in three-year notes, $24 billion in 10-year notes and $16 billion in 30-year bonds at a series of auctions next week.