The US debt ceiling is all anyone in Washington (and increasingly elsewhere) can talk about these days. For months, politicians have been in a stalemate triggered by Republican demands for spending cuts as the price for paying America's debts. With next week seen as the point at which the Treasury may have to start issuing IOUs, any deal to avert a catastrophic default is going to come down to the wire.

Recent sticking points are tied to potential spending caps, the GOP's insistence on slashing domestic spending for several years and the Biden administration's desire for more limited cuts. On this episode of Stephanomics, Senior Editor Chris Anstey and reporter Josh Wingrove give us the state of play, from explaining what exactly the debt ceiling is to laying out some scenarios of how things progress from here.

Stephanie then sits down with economist Stephen King to talk about government debt levels more broadly, and if we should be worried given how high interest rates have climbed.

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