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24-04-2023, 08:42 AM
The U.S. will default* in June unless Democrats and Republicans reach a consensus
#Econgram_US
Facts:
1) Recently, the U.S. hit a $31.4trn debt ceiling*. Economists predict that America could default on its debt in June.
2) In response, Democrats* asked to lift the debt limit to repay creditors. However, Republicans* demanded a spending cut in exchange.
Analysis:
1) Republicans proposed several measures that would reduce billions in public spending. That will undermine Biden’s government policy priorities but would make the American debt sustainable. However, the President is reluctant to accept any compromise.
2) Republicans proposed to annul roughly $50-$60bn of the pandemic relief funds that have not yet been used. Besides, they suggested reducing spending on climate measures and other Biden initiatives.
3) House Republicans set the ambitious plan of balancing* the budget in ten years. Given the increase in the cost of borrowing due to inflation, they need to cut $3.6trn in spending over a decade.
4) Overall, if parties do not reach a consensus, then the U.S. will default. That would lead to a global financial crisis and a recession.
https://www.nytimes.com/2023/04/20/us/po...-ios-share&referringSource=articleShare
#Econgram_US
Facts:
1) Recently, the U.S. hit a $31.4trn debt ceiling*. Economists predict that America could default on its debt in June.
2) In response, Democrats* asked to lift the debt limit to repay creditors. However, Republicans* demanded a spending cut in exchange.
Analysis:
1) Republicans proposed several measures that would reduce billions in public spending. That will undermine Biden’s government policy priorities but would make the American debt sustainable. However, the President is reluctant to accept any compromise.
2) Republicans proposed to annul roughly $50-$60bn of the pandemic relief funds that have not yet been used. Besides, they suggested reducing spending on climate measures and other Biden initiatives.
3) House Republicans set the ambitious plan of balancing* the budget in ten years. Given the increase in the cost of borrowing due to inflation, they need to cut $3.6trn in spending over a decade.
4) Overall, if parties do not reach a consensus, then the U.S. will default. That would lead to a global financial crisis and a recession.
https://www.nytimes.com/2023/04/20/us/po...-ios-share&referringSource=articleShare
![[Image: american-dollar-toilet-roll.jpg?s=612x61...OZFf8vNg8=]](https://media.istockphoto.com/id/176074798/photo/american-dollar-toilet-roll.jpg?s=612x612&w=0&k=20&c=zSMbdX0R83V7jAF_uDGwLGr2FRRz1ze9-tOZFf8vNg8=)
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