Debt Limit
The Story
Congress is gearing up for a debt ceiling standoff.
What’s the latest?
Like a credit card max, the federal gov only has so much (in this case, $31.4 trillion) it can spend on bills. Today, it’s expected to hit that max number. Meaning, if the US goes past its max to try to pay off its obligations — like Social Security checks and military salaries — it goes into default. This isn’t just a really, really bad credit rating — although default would be unprecedented, and could take a huge hit on global confidence in the US dollar. It could also trigger higher interest rates, a drop in stocks, and other kinds of economic distress…like a recession.
How do we prevent that?
The decision to lift or suspend the borrowing cap falls on Congress — but any changes need a majority in the House and Senate. House Speaker Kevin McCarthy (R-CA) says he’s on a mission “to end wasteful Washington spending.” Democrats and the White House say the debt ceiling must be handled “without conditions.” Meanwhile, Treasury Secretary Janet Yellen is prepared to take “extraordinary measures” to prevent the US from defaulting on payments until at least early June while lawmakers continue to hammer out an agreement.
theSkimm
When McCarthy won the speakership this month, a group of Republicans made clear that keeping the US in check with its debt ceiling was a must. Now, Republicans and Dems are on track to go head to head — and the results could have historic economic consequences.
And Also...This
Who’s ending on a bittersweet note…
New Zealand’s Prime Minister. Yesterday, PM Jacinda Ardern announced she’s stepping down from her role to make room for a new Labour PM. Her last day will be February 7. Ardern said she no longer has “enough in the tank” to keep on as PM. She served as New Zealand's youngest female prime minister for nearly six years. Arden was commended for her compassionate handling of New Zealand’s worst mass shooting. She also rose as a prominent figure in the fight against Covid. She was later criticized for implementing a strategy that many described as too strict. Recent polls have had her and her party trailing behind the conservative party, with some showing her approval rating at the lowest level since 2017. Now, Ardern says she will remain as a lawmaker until the October general elections. As for the new PM, the Labour Party is expected to elect a new leader in the coming days. Possible replacements include Justice Minister Kiri Allan and Police and Education Minister Chris Hipkins.
What may be a fly on the wall…
The US gov. Yesterday, a Senate report called out one of the biggest US gov surveillance programs. The report says that in 2014 Arizona state officials set up a database at a local nonprofit, reportedly to prevent drug and human trafficking into the US. The database monitored millions of Americans who transferred $500 or more. That didn’t apply only to Arizonians — it included residents from California, New Mexico, and Texas, too. All that info was made available to the police. Over 600 law enforcement agencies were able to monitor transfers sent through Western Union, MoneyGram, Ria, Viamericas, and Maxitransfers. They also had access to senders' and receivers' full names and exact transfer amounts. The nonprofit says this is all about preventing crime. Congressional lawmakers are accusing the program of invading Americans’ privacy. Now, the Senate report is calling on the Justice Department to investigate.
Where people are on high alert…
Ukraine. Yesterday, President Volodymyr Zelenskyy held a minute of silence at the World Economic Forum to honor the victims of the deadly helicopter crash. At least 14 people were killed — including Interior Minister Denys Monastyrskyi and other officials — when the helicopter crashed near a kindergarten outside Kyiv. An investigation is underway, but there didn’t appear to be any initial indication that the helicopter was shot down. Meanwhile, Zelenskyy — who called the incident a “terrible tragedy” — renewed his calls for support from Western leaders at Davos.
What might be a latte better than you’d think…
Coffee pods. Analysis from researchers in Canada found that single-use coffee pods might be better for the environment than other brewing options. There’s no question tossing out pods every day is wasteful. But researchers emphasize that it’s important to look at the entire journey of brewing a cup of joe. Turns out, a traditional filter coffee machine might be the most wasteful. That’s because it requires more beans, water, and electricity than other brewing options. The way Keurig users got the last sip.
What’s making us rethinx our underwear choices…
Who may have been alive this whole time, cats and kittens...
Why office birthdays might be a thing of the past...
Cake.
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