White House openly threatens US default as debt fight escalates
US Treasury Secretary Jacob Lew has issued a categorical warning that the United States will default on its $16.7 trillion debt and throw the world into turmoil unless Congress agrees to raise the legal debt ceiling by October 17.
There’s no particular reason why they should have to default. They can obviously roll over expiring debt. And the interest bill, set against other government spending, isn’t that bad. It’s entirely possible for them to reshuffle the cash flows and keep on paying the debt bills.
But it does seem that they’re getting into a dick measuring contest over this. And that doesn’t bode well for sensible and reasonable decision making.
We’ve closed the monuments so that you can see how bad the government shutdown is. We’re going to default on the debt to show you how terrible those Republicans are. I don’t say they will do this but I’ve a horrible feeling that that’s how they’re all thinking.