What They’re Saying: Default Would be Devastating

The evidence is clear: defaulting on our nation's debt is no joke. The only real solution to avoid default is to raise our nation's debt limit. Take a look at what's being said by economists, government officials, and stakeholders about the consequences of default if Congress fails to raise the debt limit:

"The question is will we muster the political will to avoid the self-inflicted wounds that come from a political stalemate." – Treasury Secretary Jack Lew (10/8/15)

"We have learned from the past that failing to act until the last minute can cause serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers, and negatively impact the credit rating of the United States. And there is no way to predict the irreparable damage that default would have on global financial markets and the American people." – Treasury Secretary Jack Lew (10/15/15)

"If Treasuries are to remain the global benchmark, regular and prolonged debates in Congress over whether to raise the debt limit—whether to pay our bills—must become a thing of the past. The role that Treasuries play in the global financial system, and the benefits they bring to the U.S. economy, rest on the bedrock foundation of the full faith and credit of the United States." – Antonio Weiss, Counselor to the Treasury Secretary (10/20/15)

"The debt limit should not be negotiable. It is debts that we owe as this great country of ours. It would be just horrible, foolish and bad for the country to start to renege on the bills we already have run up." – Senator Harry Reid (10/13/15)

"The debt limit should be a no-brainer for us to resolve." – Senator Ben Cardin (10/8/15)

"Failure to protect the full faith and credit of the United States would have a devastating impact on hard-working families across the country – including tumbling retirement savings and soaring interest rates for student loans, mortgages, credit cards, and car payments. As we saw in 2011, even the threat of refusal to honor the full faith and credit of our nation has serious consequences." – House Democratic Leader Nancy Pelosi (10/15/15)

"If Republicans proceed on this course, it will be the third time they have done serious damage to our economy by threatening to default. When the Republicans brought us to the brink of default four years ago, the stock market plunged and S&P downgraded our credit rating for the first time ever. In 2013, Republican default threats and the government shutdown cost us 120,000 jobs and slowed GDP growth just as the economic recovery was taking hold." – Ways and Means Committee Ranking Member Sander Levin (9/10/15)

"New research from academics and the Government Accountability Office strongly indicates that the movement toward expiration is accompanied by an increase in the government's cost of issuing new debt… These costs stem solely from the mere threat of default, but there are additional potential costs to be considered from an actual failure of the Treasury to service its debt or to pay its bills." – William Beach, Chief Economist, Senate Budget Committee (10/2/15)

"You open a hornet's nest of nightmares and difficulties for the Treasury, literally which legal promises on either debt or programs are you going to break?" – Doug Holtz-Eakin, former director of the Congressional Budget Office (10/16/15)

"There's no way that you can pretend that taking out the Pentagon budget and a huge chunk of the domestic budget is not going to be damaging. It will. And I don't think international investors will be mollified by the fact they got their two bucks while the U.S. burned down." – Doug Holtz-Eakin, former director of the Congressional Budget Office (10/21/15)

"Lawmakers shouldn't fool themselves: simply protecting bondholders and Social Security beneficiaries won't avert financial chaos or soothe creditors." – Joel Friedman, CBPP

"What is becoming more concerning from an economic growth perspective is that we're going right down to the deadline in many of these cases." – Michael Brown, Wells Fargo (10/1/15)

"Congress actually has no choice but to raise the limit. This is necessary for the government to meet all of its obligations, which are based on spending and tax policies already approved by lawmakers. A federal default on even some of these obligations could have a very negative effect on global financial markets and economic growth." – Phil LaRue, Concord Coalition (10/6/15)

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