T he statutory debt limit, currently suspended through December 8, 2017, provides Congress a means of controlling federal borrowing. As the date when that suspension will lapse approaches, discussions about the role of the debt limit among the media, researchers, and Members of Congress promise to become a more frequent. In recent discussions, misleading or less than fully accurate claims have at times surfaced. This report provides clarifications on five common debt limit contentions. The debt limit represents one way that Congress exerts control over fiscal policy, which stems from closely related constitutional provisions. Those provisions—the Taxing and Spending Clause ("Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States") and the Borrowing Clause ("Power ... To borrow Money on the Credit of the United States") —establish the basis of the congressional power of the purse. Congress, under its Borrowing Clause powers, has authorized the Department of the Treasury to borrow through various debt instruments to finance expenditures not covered by federal receipts. The total amount of outstanding federal debt, with minor exceptions, is constrained by a statutory debt limit. When that limit is close to binding, the Treasury Secretary can invoke authorities to employ extraordinary measures to finance federal expenditures. If expenditures persistently outrun receipts, and if the debt limit is not modified, at some point Treasury's cash balances and borrowing capacity would be exhausted, leaving the Treasury without means to meet federal obligations. The latest debt limit episode was resolved on September 8, 2017, when a continuing resolution measure ( P.L. 115-56 ) was enacted that included a suspension of the debt limit through December 8, 2017. Once that debt limit suspension lapses, the Treasury Secretary may again invoke authorities to use extraordinary measures, which would likely suffice to meet federal obligations well into 2018. Federal debt has been subject to limits since the beginning of the U.S. government. Before 1917, Congress typically specified the interest rates, maturities, call options, and other aspects of debt issuances. During wars, however, the U.S. Treasury was often granted more leeway in deciding terms offered to investors. At times, Congress designated loan proceeds for specific purposes such as rolling over existing federal debt, helping construct an intercontinental railroad in the 1860s, or financing the Panama Canal after the turn of the 20 th century. At other times, bonds were authorized simply to "meet the current expenses of the Government." Enactment of the Second Liberty Bond Act of 1917 (P.L. 65-43, 40 Stat. 288) on September 24, 1917, marked a turning point in federal debt policy, but maintained substantial constraints on Treasury debt operations. The act imposed the first aggregate limit on federal borrowing, but retained individual limits on separate bond issues as well. During 1920s and 1930s, Congress allowed the U.S. Treasury more leeway to manage federal debt in order to roll over World War I-era debt. In July 1939, Congress set an aggregate limit (P.L. 76-201) on federal debt, allowing Treasury officials to decide how to manage that debt. Thus, the modern debt limit—meaning an overall limit on federal debt without sublimits—might more properly be said to have been established in 1939. Some contend that the federal government suffered technical defaults in the late 1970s. An examination of the historical record suggests otherwise. While the meanings of the terms "default" or "technical default" are clear in private contracts, they are less clear when applied to the federal government. Private-sector contracts normally spell out "events of default," such as failure to pay on time as well as other lapses. Technical defaults refer to violations of a legal agreement—such as a loan or securities contract—not involving failure to pay. The issuance of Treasury securities, however, is governed by the Universal Offering Circular, which does not address failure to pay or other types of default events. Moreover, a breach of the debt limit—that is, a situation in which total federal debt subject to limit exceeded that limit—does not necessarily imply delayed or missed payments or other failures to uphold the federal obligations. In certain past episodes, breaches caused by lapsed temporary debt limit increases resulted in no payment delays, and thus were not defaults in the ordinary sense of that term. In the present context, however, a fully binding debt limit or breach could quickly lead to systematic payment delays and damage to the federal government's fiscal reputation, its credit rating, and its ability to borrow at advantageous rates. Political scientists Thomas Mann and Norman Ornstein contend that a technical default occurred in October 1977, when a temporary debt limit increase lapsed before a revised debt limit measure was enacted. The previous debt limit measure ( P.L. 94-334 ), enacted on June 30, 1976, included three temporary increases in the debt limit for specific time periods above a "permanent" limit of $400 billion. The last temporary increase of $300 billion lapsed after Friday, September 30, 1977. While both the House and Senate had approved a debt limit measure by that date, differences were not resolved until Tuesday, October 4, 1977, when it was enacted. Thus, for two business days, federal debt, which was close to $700 billion, was above its statutory limit of $400 billion. After the temporary debt limit increase lapsed, Treasury could not borrow, though its cash reserves were sufficient to meet federal obligations until the new measure was enacted, even if some special financial measures were employed. No federal payments, however, were missed or delayed—suggesting that no technical default occurred. Moreover, federal officials responsible for issuing that debt acted within their statutory authorities. Others have pointed to a 1979 episode when some interest and principal payments to some small investors holding Treasury securities were delayed. In late April and early May 1979, about 4,000 Treasury checks for interest payments and security redemptions were delayed due to back-office technical and organizational problems, in part related to a reorganization of Treasury debt operations. Delays affected payments estimated at $122 million, with foregone interest totaling an estimated $125,000. Those amounts represented a small share of the market in Treasury securities: for instance, a few days before those delays, the U.S. Treasury rolled over $6 billion in debt. The federal government may have reached a settlement with affected investors. Some ascribe those payment delays to a debt limit episode. A temporary increase in the debt limit ( P.L. 96-5 ), however, was enacted on April 2, 1979—more than three weeks before the first delayed payment. Those payment delays were also blamed for increasing federal borrowing costs. Market interest rate movements on the date of the first payment delay—April 26, 1979—were more plausibly affected by significant Federal Reserve announcements made that day rather than payment delays that were not reported until a week and a half later. Some commentators have claimed that contentious debt limit episodes are a recent phenomenon. Debt policy, however, has been a divisive issue since the beginning of American government. Debt, by its nature, allows government to shift the fiscal burden of current expenditures or lessen the burden of current taxes by transferring obligations to future taxpayers. Shifting fiscal burdens into the future through debt management is a powerful and potentially beneficial tool of fiscal policy, but can also become a means of avoiding fiscal responsibility in the present. Debt policy discussions, therefore, often become contentious. Since 1978, 27 of a total of 56 debt limit modifications were "clean"—meaning that a debt limit measure wa s not linked to other provisions. That delineation, however, is imperfect. In some cases a debt limit provision might have been attached to another measure that acted as a convenient legislative vehicle for passage. In other cases, combining a debt limit modification with other provisions may have resulted from a broad fiscal compromise among policymakers. In addition, a debt limit modification enacted as a standalone measure could have resulted from a policy compromise involving other issues. For instance, on February 15, 2014, a "clean" debt limit increase ( P.L. 113-83 ) was enacted. On the same afternoon another measure ( P.L. 113-82 ) was enacted to reverse certain reductions in cost-of-living adjustments to working-age military retiree pensions that had been included in the Bipartisan Budget Act of 2013 (BBA2013; P.L. 113-67 ). Although nothing formally linked the two measures, their passage in quick succession may have reflected a fiscal compromise. Debt limit measures have been informally or formally linked with other issues for many decades. In 1939, when Congress was considering creating what became the modern debt limit, Senator George Norris offered an amendment to allow the Tennessee Valley Authority (TVA) to use bonds to consummate purchases of some power plants. Once a separate TVA measure was agreed to, the amendment to the debt limit measure (H.R. 5748) was withdrawn. In 1957, Congress declined to raise the limit until the following February, in part to "compel more economy of efficiency, better management of money and manpower in the defense program." In the 1960s, debt limit debates provided a forum for those concerned about the expansion of federal spending due to federal credit guarantees, new social insurance programs, and the escalation of the Vietnam War. In the early 1970s, debt limit measures were embroiled in debates over campaign finance reform and in congressional conflicts with the Nixon and Ford Administrations. In the mid-1980s, a debt limit provision was packaged with the Gramm-Rudman-Hollings budget constraints. The debt limit episode of 1995-1996 was described by the U.S. General Accounting Office (GAO; now Government Accountability Office) as a "crisis."