The U.S. government could default on its debt by July if Congress does not increase the debt limit, according to the Congressional Budget Office.
The CBO released a projection on Wednesday warning that the U.S. will reach borrowing limits and be unable to make payments on current debts this summer. The current borrowing limit is $31.4 trillion and the U.S. reached it on January 19.
This situation will be made worse if tax collection in April does not go as planned.
Congress is working on raising the debt, but Republicans are asking for budget cuts before they agree to any numbers. If this sounds familiar, it is because the U.S. does this every few months. They play politics until the last minute and then kick the can down the road.