According to numerous economists, if Congress does not agree to raise the debt ceiling, the federal government will not be able to pay all its bills. That default, which is projected on or around June 1, would plunge the U.S. into an instant recession.
One million jobs would be lost in the first week with nearly eight million jobs lost if a default goes on for multiple weeks. This is partially due to consumers pulling back on spending, impacting businesses’ ability to pay workers.
Federal payments to millions of working people, retirees, veterans and more would be delayed.
Sixty-six million people rely on Social Security each month to pay their bills and keep a roof over their heads. For 40% of recipients, Social Security makes up 90% of their monthly income. These payments would be delayed.
SNAP food stamp payments would be delayed, as would Medicaid payments to states and Medicare payments to hospitals and doctors―devastating to health infrastructure, especially in rural communities.
Two million federal workers, 1.4 million active-duty military personnel, plus government contractors would all see delays in payments. And veterans’ benefits, including disability payments and pensions would be impacted.
Meanwhile the stock market would take a severe hit, dropping anywhere from 33 – 45%, wiping out $12 trillion of household wealth, including retirement accounts.
The U.S. is on the brink of default. Click here to send a message to your senators and representative right now and demand a clean debt ceiling vote with no cuts to critical programs and services.
History shows that even the threat of a federal default would impact the economy. We need Congress to act now.
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Due to the COVID-19 pandemic Friday Advocates’ Meetings have been halted until further notice.
For further information please email Richelle Friedman at: rfriedman@chn.org
