A History of U.S. Debt Limits

George J. Hall, Thomas J. Sargent

NBER Working Paper No. 21799
Issued in December 2015
 

Congress first imposed an aggregate debt limit in 1939 when it delegated decisions about designing US debt instruments to the Treasury. Before World War I, Congress designed each bond and specified a maximum amount of each bond that the Treasury could issue. It usually specified purposes for which proceeds could be spent. We construct and interpret a Federal debt limit before 1939.