The comment is, of course, misleading. There is no chance of the US running out of cash, or defaulting, unless that is what the Republicans choose that it should. The US can in reality create as much money as it wants, subject (if it is prudent) to inflation constraints and, of course, politics.
The Republicans could try to crash the dollar. But let’s be quite clear, that is not necessary. And the impression given that the US is running out of money is false. It can’t do that unless some deeply misguided politicians choose otherwise.
Sigh, if only he knew anything.
The US has a legal debt limit. Congress has passed a law – you know, democracy and all that – which says that the national debt can only become “yea big”.
Every few years they realise how much this is constraining their spendthrift ways and vote again to make the new debt limit “yea plus big”.
The Federal Reserve does not print dollars and send them to Treasury. Instead, financing is done by the Fed buying Treasury bonds (bills, notes) meaning that the debt size is, given the debt cap, a constraint of the number of dollars available to the government.
Congress has, in the past, refused to raise the debt cap. And government has started to close down for lack of money. They do, generally, quickly then raise the debt cap.
The US is one of those places where the national government can actually run out of its own cash.