Is a U.S. default really that bad?

playing with fire Pictures, Images and Photos Yes, if the U.S. government were to default on their debt it would be that bad. Frankly, I think it’s silly that I am made to feel compelled to even have to write a post about this obvious answer. Unfortunately, some lawmakers and their supporters in the U.S. are saying that perhaps it would not be as bad as everyone is saying if the U.S. defaulted on its debt. It is no coincidence that all the people saying this are Republicans. Although I don’t really believe that Republicans want the U.S. to go through a default just so that President Obama fails miserably, they are less scared of it because they are not in power.

If the U.S. were to default on its debt, we would likely see another recession. However, this recession would probably be worse than the last one because the government would not be able to borrow money which it does now in order to provide many essential services. In addition to the mass layoffs, the global economy would instantly tank. The U.S. is currently the world’s most powerful, reliable and bankable economy. The U.S. Dollar is the world’s reserve currency. If the U.S. defaults on its debt, every country in the world would see their economy fall. This is especially true for other large economies like China, all European economies, Canada, Japan, etc… There is no telling how bad it would get and for how long, but trust me, it would get real ugly.

Republicans do not want to face the fact that in order to raise the debt limit to avoid a default they will need to accept some tax increases. The Democrats already agreed that there will be far more spending cuts than tax increases, but taxes like those on the richest Americans and oil companies need to take place for a deal to get done. Republicans are playing with fire and their country and the entire world may get burned for it. People should be calling their Republican elected officials and demand they accept tax increases on the rich and oil companies to avoid impending economic doom.