WASHINGTON D.C. — Monday afternoon President Biden and Republican Speaker Kevin McCarthy met yet again to discuss the debt limit.
If they can’t find common ground soon, officials say the nation could go into default for the first time ever.
While the debt limit is issue number one in Washington D.C., economists say it could impact everyone in the U.S., and also the global economy, in a way we haven’t seen before.
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The clock is ticking to reach a deal on raising the national debt ceiling.
If that agreement doesn’t happen it would mark the first time in history the U.S. has defaulted on its financial obligations.
“I mean, a default on the Treasury debut. I can, I can state with a high degree of confidence that would be catastrophic,” Mark Zandi, Moody’s Analytics Chief Economist said.
Economists say we could see even higher borrowing rates for mortgages, credit cards, and other loans.
Millions of jobs could be wiped out by the end of summer and the unemployment rate could double nationwide.
Analysts say the last time we had this “debt drama” in 2011, the stock market fell 17 percent.
On Capitol Hill, Republicans and Democrats are putting out their own talking points.
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Just days ago, President Biden told reporters he’s offered more than $1 trillion in spending cuts as part of these talks, calling it a major shift in negotiations.
Before Monday’s meeting, Republican leaders laid out where they stand.
“The underlying issue here is the Democrats since they took the majority have been addicted to spending and that’s going to stop,” McCarthy said.
Sen. Bernie Sanders joined some Democrats and signed a letter to the president urging him to consider using the 14th Amendment, which would then lift the debt ceiling.
“The president has the authority to use the 14th Amendment and he should be prepared to do that, period,” Sanders said.
The Treasury Department says it will likely run out of money as early as June 1, which is next week.
The Speaker of the House said Monday they must get a deal done this week to avoid default.
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