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The U.S. fiscal fight: who's involved, what's at stake

Partisan battles over government shutdown, debt ceiling

Last Updated: Oct. 17, 2013

U.S. Capitol, October 2013

The U.S. government was partially shut down on Oct. 1 after Congress could not pass legislation to continue funding its operations.

House Republicans tied their support to demands for changes to President Barack Obama's signature health-care law. The Democrats and White House refused to consider it. The stalemate was on, and hundreds of thousands of federal workers were temporarily off the job.

Then the battle over raising the country's $16.7-trillion debt ceiling was added to the mix. Congress must approve any increase, but partisan differences kept that from happening for several months.

A deal to temporarily reopen the government and raise the debt limit was reached on Oct. 16, mere hours before a deadline set by the Treasury Department. Cooler heads have prevailed — for the time being, at least.

Who's who: decision makers and important players

Key points of the Oct. 16 deal

The debt ceiling explained

Before the First World War, the U.S. federal government needed congressional approval every single time it borrowed money. That all changed with the Second Liberty Bond Act of 1917, which enacted a broad legal limit for how much could be owed. This is the origin of the much-talked-about "debt ceiling," which has become a political hot potato in recent years.

An increase to the limit does not necessarily bring new spending or give a president carte blanche. But it does allow the government to borrow so it can pay for items it has already bought. See below for how the debt limit has increased steadily under a number of administrations over the past five-plus decades.

Sources: CBC News stories, wire service reports, U.S. Office of Budget Management, Bureau of Economic Analysis, Bureau of Labor Statistics.
Top photo: Jonathan Ernst/Reuters

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