Federal law prohibits the "face amount of obligations whose principal and interest are guaranteed by the United States Government" from exceeding the statutory debt limit (31 U.S.C. §3101). The Department of the Treasury has the power to take some temporary "extraordinary measures" that extend the date on which the statutory limit is reached. In the event that the federal government reaches the statutory debt limit and exhausts extraordinary measures, the law prohibits Treasury from incurring any additional debt, and Treasury would be required to meet spending demands exclusively through money received from incoming revenues and existing debt. Following a six-month period during which Treasury implemented "extraordinary measures" to prevent a binding debt limit, the debt limit was increased by $5.0 trillion, to $41.1 trillion, in July 2025 by P.L. 119-21. How Treasury would respond to a binding debt limit is unclear.  […]