"The Constitution grants Congress the power to borrow money on the credit of the United States-- one part of its power of the purse--and thus mandates that Congress exercise control over federal debt. Control of debt policy has at times provided Congress with a means of raising concerns regarding fiscal policies. Debates over federal fiscal policy have been especially animated in recent years. The accumulation of federal debt accelerated in the wake of the 2007-2008 financial crisis and subsequent recession. Rising debt levels, along with continued differences in views of fiscal policy, led to a series of contentious debt limit episodes in recent years. The debt limit was suspended through March 15, 2015. The next day the limit was set at $18.1 trillion and Treasury Secretary Jacob Lew invoked authorities to carry out extraordinary measures to meet federal obligations. Independent forecasters expect that the U.S. Treasury will be able to pay federal obligations until October or even November 2015. Those forecasts, however, are subject to significant uncertainties. Total federal debt can increase in two ways. First, debt increases when the government sells debt to the public to finance budget deficits and acquire the financial resources needed to meet its obligations. This increases debt held by the public. Second, debt increases when the federal government issues debt to certain government accounts, such as the Social Security, Medicare, and Transportation trust funds, in exchange for their reported surpluses. This increases debt held by government accounts. The sum of debt held by the public and debt held by government accounts is the total federal debt. Surpluses reduce debt held by the public, while deficits raise it. This report will be updated as events warrant."
CRS Report for Congress, R43389
Federation of American Scientists: http://www.fas.org/sgp/crs/index.html