People ask, “Just what is the argument about the debt ceiling?”
The answer seems almost too simple. A vote that fails to raise the debt limit is a vote that fails to support the items that the majority voted for last year; the failure risks a financial collapse here in the U.S. and worldwide. There was already general agreement to pass these bills (and support their financial obligations); the President signed them into law bill by bill. And now the failure to support lifting the ceiling reverses policies people are already counting on. It is a manufactured crisis.
The key question is, “How worried should we be if the debt ceiling isn’t lifted?
The answer is NOT simple.
The Brookings Institute answers, “If the debt ceiling binds, and the U.S. Treasury does not have the ability to pay its obligations, the negative economic effects would quickly mount and risk triggering a deep recession.”
The economy goes into a tailspin. Jobs are lost. Social Security checks are endangered. Interest rates go up, Medicaid payments would stop. The credibility of the United States would collapse, aiding China, Russia, and other countries that are not allies of the United States. Given the U.S.’s key role in the worldwide economy, the whole world could go into recession … a recession manufactured by the Republicans’ narrow majority in the House.