What happened: The U.S. federal government hit its approximately $31.4 trillion debt ceiling on Thursday—the equivalent of $94,000 of debt per person in the country. Out of the total amount, $24.5 trillion is from debt held by the American people. The government is currently spending $1 billion per day in interest on this total heap of debt.

The Treasury’s response measures: Treasury Secretary Janet Yellen stated the department is taking “extraordinary measures” to pay off some of the debt to temporarily avoid an economic crash for several months. Further action is needed to prevent a coming economic meltdown.

Republican vs. Democrat approach: While the White House urged Congress to raise the debt ceiling “without condition,” allowing the federal government to add to the trillions of dollars to the debt it has already accumulated, some Republicans favor cutting government spending.

What happens next: If the U.S. Treasury defaults, meaning it can no longer pay off these debts, the government must choose which debts to keep paying off and which to default on. This could be disastrous for average Americans, who may face having their veteran benefits or their retirement pension plans cut.