Staff Reports
The First Debt Ceiling Crisis
June 2016   Number 783
JEL classification: E42, H63, N22

Author: Kenneth D. Garbade

In the second half of 1953 the United States, for the first time, risked exceeding the statutory limit on Treasury debt. This paper describes how Congress, the White House, and Treasury officials dealt with the looming crisis—by deferring and reducing expenditures, monetizing “free” gold that remained from the devaluation of the dollar in 1934, and, ultimately, raising the debt ceiling.

Available only in PDF pdf 13 pages / 206 kb
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