Last night, House Republicans voted against suspending the debt ceiling, which could send our recovering economy into a tailspin, cost six million American jobs, wipe out $15 trillion from American households, stop Social Security payments, and block our service members from getting paid. Republican leaders have spent the week putting their hypocrisy on full display and we are here to hold them accountable for their political games.
Republicans are threatening to cost 6 million jobs, wipe out $15 trillion in household wealth, and send unemployment skyrocketing.
- Washington Post: “Mark Zandi, chief economist at Moody’s Analytics, found that a prolonged impasse over the debt ceiling would cost the U.S. economy up to 6 million jobs, wipe out as much as $15 trillion in household wealth, and send the unemployment rate surging to roughly 9 percent from around 5 percent.”
Republicans are threatening to send the American economy and global financial markets into a tailspin.
- CNBC: “At the very least, fear of default could rattle the stock market and send shock waves throughout the economy, according to Bankrate’s Hamrick.”
- Washington Post: “Failure to raise the debt limit would have catastrophic impacts on global financial markets. Interest rates would spike as investors demand a higher rate of return for the risk of taking on U.S. debt given uncertainty about repayment. An increase in interest rates would ripple through the economy, raising costs not only for taxpayers but also for consumers and other borrowers. The value of the U.S. dollar would also decline long term as investors questioned the security of purchasing U.S. treasuries. The cost of auto and home loans would rise.”
Republicans are threatening to stop Social Security and veterans benefits, prevent our troops from getting paid, and delay vital child tax credits.
- CNBC: “In the worst-case scenario, the federal government would default, at least temporarily, on some of its obligations, including those Social Security payments, veterans’ benefits and salaries for federal workers.”
- Treasury Secretary Janet Yellen: “Nearly 50 million seniors could stop receiving Social Security checks for a time. Troops could go unpaid. Millions of families who rely on the monthly child tax credit could see delays.”
Republicans are threatening to send costs skyrocketing for American families on items like car loans, credit cards, and mortgage rates.
- CNBC: “In addition, potential downgrades of U.S. credit ratings would hammer Treasurys. Demand for U.S. Treasury bonds could sink if they are no longer considered a reliable, safe-haven investment and bondholders would demand dramatically higher interest rates to compensate for the increased risk. That, in turn, would send other borrowing costs higher, including credit cards, car loans and mortgage rates (which generally are pegged to yields on U.S. Treasury notes).”
Republicans are now playing political games with Americans’ livelihoods after the national debt increased by nearly $8 trillion under Trump.
- Washington Post: “Lawmakers in both parties agree that the debt ceiling must be raised to avoid economic calamity, but their standoff over how to do so has intensified. Despite the national debt increasing by close to $8 trillion under President Donald Trump, Republicans have been adamant that they will refuse to help Democrats increase the debt ceiling, in opposition to President Biden’s spending plans.”
- Treasury Secretary Janet Yellen: “When we raise the debt ceiling, we’re effectively agreeing to raise the country’s credit card balance, and in this case, 97% of that balance was incurred by past congresses and presidential administrations. Even if the Biden administration hadn’t authorized any spending, we would still need to address the debt ceiling now.”
Republicans’ political games with the debt limit are already creating uncertainty that could hurt Americans and the economy.
- Washington Post: “Even resolving the matter before the debt ceiling is breached could hurt U.S. taxpayers and the American economy in the long term. The budget battles over the debt ceiling of 2011 and 2013 under the Obama administration created financial uncertainty and deflated business investment, costing the U.S. economy as much as $180 billion and 1.2 million jobs by 2015, according to Zandi and Yaros.”
- CBS News: “Even the threat of default can have financial consequences. In August 2011, the U.S. credit rating was downgraded from AA+ to AAA for the first time in history by Standard & Poor’s, just days after the Obama administration reached a deal with Congressional Republicans.”