By Susan Petroni
In a speech Wednesday on the floor of the U.S. Senate, Senator Elizabeth Warren (D-Mass.) outlined the potential consequences of a voluntary default on our nation’s debt and called on Congress to immediately raise the debt ceiling.
“We’re in this position for one reason, and one reason only: because Congress told the government to spend more money than we have – and Congress told the Treasury to run up our debt to pay for it – but now Congress is threatening to run out on the bill,” Senator Warren said. “…The idea that we can somehow renege on our debts without paying a huge price is a fantasy—and a very dangerous one.”
Warren highlighted the widespread concern among economists of every political persuasion that a default could plunge the country into another recession, and spoke about the consequences a default would have for American families.
“This fight is about financial responsibility. Financially responsible people don’t charge thousands on their credit cards and then tear up the bill when it arrives. Financially responsible nations don’t either.…If we default on our debt, we could bring on a worldwide recession—a recession that would pummel hard-working middle class people, people who lost homes and jobs and retirement savings and who are barely getting back on their feet,” said Warren. “This is no time to act out dangerous fantasies.”