Study Says U.S. Default This Fall Would Cost 6 Million Jobs
It also would wipe out $15 trillion in wealth
The United States could plunge into an immediate recession if Congress fails to raise the debt ceiling and the country defaults on its payment obligations this fall, according to one analysis released Tuesday.
Mark Zandi, chief economist at Moody’s Analytics, found that a prolonged impasse over the debt ceiling would cost the U.S. economy up to 6 million jobs, wipe out as much as $15 trillion in household wealth, and send the unemployment rate surging to roughly 9 percent from around 5 percent.
Lawmakers in both parties agree that the debt ceiling must be raised to avoid economic calamity, but their standoff over how to do so has intensified. Despite the national debt increasing by close to $8 trillion under President Donald Trump, Republicans have been adamant that they will refuse to help Democrats increase the debt ceiling, in opposition to President Biden's spending plans.
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