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According to the Constitution, the Congress must approve all borrowings on behalf of the United States. Before the 20th century, Congress approved all bond issuances separately and explicitly. With the introduction of the debt ceiling, the treasury now had a line on which it could borrow as it needed to without having to go back to Congress for borrowings under the ceiling.
According to the Constitution, the Congress must approve all borrowings on behalf of the United States. Before the 20th century, Congress approved all bond issuances separately and explicitly. With the introduction of the debt ceiling, the treasury now had a line on which it could borrow as it needed to without having to go back to Congress for borrowings under the ceiling.
== Components of the Debt ==
There are two components to the Federal Debt, the debt held by the public, and intragovernmental debt. The debt held by the public is debt held by any individual or entity that is not the federal government such as a mutual fund, individual investor, foreign government, or a municipal government <ref>http://www.concordcoalition.org/issue-briefs/2011/0708/understanding-federal-debt-limit</ref>. Intragovernmental debt is debt the government owes itself such as the Social Security Trust Funds, the Medicare Hospital Insurance Trust Fund, and the Civil Service Retirement and Disability Fund <ref>http://www.concordcoalition.org/issue-briefs/2011/0708/understanding-federal-debt-limit</ref>. Currently Debt held by the public is roughly 2/3 of the total Federal Debt.
== History of the "Debt Limit" ==
== History of the "Debt Limit" ==