Quote:
Originally Posted by willx
Hold on, hold on .. let me put my "know-it-all" hat on for a second.
Even if the debt ceiling doesn't reach a deal, there are ways for the U.S. to continue to pay its obligations which would avoid default. This issue would still result in significant damage to GDP and hurt any economic recovery as well as make everyone skeptical about the ability for the body politic to reach consensus on the looming problems ahead -- pensions, health care reform (further), tax code reform, etc.
So, things'll still spell trouble, but there isn't going to be any default.
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The problem isn't some sudden explosive failure of Washington. The problem is if the GOP is serious about turning the hostage taking into the norm of day to day, it would mean we will have economic crisis every month for the next decade no matter who is running the country, unless by some miracle the laws changed.
Can USA avoid default indefinitely? Possibly. But what we now worry is a permanent malaise. That we will get political theatre on a monthly basis from now on until the US of A ceases to exist.