Why Does the Government “Shut Down”? If Congress and the President are unable to agree on new appropriations bills before the start of the new fiscal year (or prior to the expiration of a continuing resolution), a “government shutdown” can occur. A “shutdown” can be partial if only some of the appropriations bills are not...| EPIC for America
The evidence in this paper points to a simple story. QE follows fiscal events, but it has not systematically caused an expansionary fiscal stance. I show that deficits widen before QE announcements and are not associated with a persistent increase in the primary balance, the CAPB, or the fiscal impulse. Where I do find a difference is around severe shocks (recessions, COVID-19) when the Fed’s purchasing of Treasury securities was already large or when it is actively buying.| EPIC for America
Background Congress will need to increase the debt limit as early as June 2025, and before the 2025 August recess at the latest. The Fiscal Responsibility Act suspends the debt limit through January 1, 2025. The new statutory debt limit will be set automatically, after that suspension expires, at the amount of debt accumulated until...| EPIC for America
