Investors and economists are watching the debt-ceiling debate with growing alarm, and some view default as committing economic suicide.
Robert Greenstein, founder and president of the
Center on Budget and Policy Priorities, describes two dangers:
- Forcing the layoff of thousands of government workers, which takes their buying power out of the economy.
- Since it would raise all interest rates, default would increase the payments in every adjustable-mortgage and small-business loan, and even increase the federal deficit itself. [read the rest]
