United States President Joe Biden slammed Republicans after the latter's continued opposition to raising the debt limit and his party's efforts to prevent the federal government from going into default.
The Democratic leader called the tactics "reckless" and "disgraceful" as he warned that lawmakers risk causing a "self-inflicted wound" that would severely damage the country's economy. Biden warned Americans that as early as this week, they could experience the effects of the failure to raise the debt limit.
Debt Limit Increase
The debt limit foretells that the amount of money that the American government is able to borrow in support of its financial obligations. This includes money to pay Social Security checks, salaries for military personnel, and other federal bills.
In a statement, Biden said that Americans could see their savings and pocketbooks be directly affected by the Republicans' efforts to block the debt limit increase. The Democrat argued that this could severely affect financial markets and send stock prices much lower and interest rates even higher.
But even with the president's continued efforts to put the blame of not having the debt limit increased on Republicans, Democrats may have no other choice other than budget reconciliation. The process involved raising the debt limit while bypassing a Senate filibuster, the New York Times reported.
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Biden repeatedly claimed that Republicans were "refusing to do their job" and that they threatened to use their authority to prevent Democrats from doing theirs. The president argued that his party wanted to prevent a catastrophic economic event. Biden warned the opposition to stop playing "Russian roulette" with the United States economy.
Oct. 18 marks the deadline that Congress has to increase the United States' borrowing limit, warned Treasury Secretary Yellen last week. Biden said in an interview that he could not guarantee the U.S. would not reach the debt ceiling, arguing it was up to Mitch McConnell to claim such a reassurance.
On the other hand, Senate Minority Leader McConnell leads the Republican opposition that argues Democrats should be able to handle the debt limit on their own. He said that they could use the special budget process, which is the budget reconciliation. The process would not require Republicans to vote on the debt limit increase, CNN reported.
Catastrophic Effects
Biden urged Republicans to "get out of the way," arguing that if they did not want to support efforts to save the country, they should stop themselves from further destroying it. Failure to raise the debt ceiling could result in a nearly 4% decline in economic activity, incur the loss of roughly six million job opportunities, bring the unemployment rate to nearly 9%, wipe out about $15 trillion worth of household wealth due to a sell-off in stocks, and increase interest rates on mortgages, consumer loans, and business debts.
Biden claimed that during former United States President Donald Trump's administration, the country has racked up nearly $8 trillion in new debt. The amount accounted for more than 25% of the entire debt outstanding of the country. The Democratic president said Republicans in Congress raised the debt three times over the course of Trump's presidency, Reuters reported.
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