President Joe Biden has issued a warning about the potential consequences of a US default, emphasizing the severe economic repercussions it could have both domestically and globally.
In his efforts to increase the pressure on Republicans to reach an agreement on raising the US debt limit, Biden underscored the grave implications that an unprecedented default would entail.
“If we default on our debt, the whole world is in trouble,” Biden said Wednesday at Westchester Community College in Valhalla, New York.
Biden presented a somber portrayal of the aftermath that would follow such a default, highlighting the detrimental impact on Americans’ financial well-being and the nation’s international reputation.
“Higher interest rates for credit cards, car loans and mortgages. Payments for Social Security, Medicare, our troops, veterans could all be delayed,” said Biden.
“Our economy would fall into recession. And our international reputation would be damaged in the extreme. We shouldn’t even be talking about this situation.”
President Biden’s remarks followed a recent meeting with congressional leaders, which, according to reports, made little progress towards reaching a consensus on raising the debt ceiling.
The president delivered his speech in the Hudson Valley district, hosted by Representative Michael Lawler, a newly-elected Republican known for his moderate stance.
Lawler’s slim victory margin of only 1,820 votes in the previous year’s election places him among the swing-district Republicans that Biden aims to influence.
The president’s objective is to exert pressure on Lawler and similar Republicans to break ranks with their party leaders and support a debt limit increase of $31.4 trillion, without the spending cuts demanded by the GOP in return.
In a display of bipartisan cooperation, Lawler joined the majority of House Republicans in voting for a bill that would raise the debt ceiling by $1.5 trillion while simultaneously implementing $4.8 trillion in spending cuts over a decade.
During his address, Biden commended Lawler, who was present at the event, as a representative with whom he could collaborate effectively. Nonetheless, the president criticized Republicans for their insistence on linking an increase in the borrowing cap to spending reductions.