Getting Answers: impacts if debt ceiling deal is not reached
SPRINGFIELD, MA (WGGB/WSHM) - The ongoing debt ceiling debate continues as President Joe Biden and House Speaker Kevin McCarthy prepare to meet Monday to try to strike a budget deal to avert an economic crisis.
“We want to continue to rely on Social Security as our main source of income. It allows us to do things like this at the Agawam Senior Center. It allows us to participate with grandchildren. It allows us to enjoy things like what the senior center has from bingo to other outings and we’re nervous that some of that is going to be impacted or at least delayed, which would be a real problem for us,” said Doug Freeman of Windsor, CT.
Almost 66 million Americans receive Social Security checks, including Joanne and Doug Freeman, who frequently visit the Agawam Senior Center. They told Western Mass News that they are concerned as uncertainty looms over the United States debt ceiling.
“We just hope that they’ll be able to come up with some conciliation’s on both sides to be able to make it so that all of the people that are affected with Social Security, we have veterans, there’s Medicare, and until you’re really in that situation, you don’t realize how important it is to keep these programs funded,” Freeman said.
A decision has to be made on whether to raise the debt limit by June 1, which is when the federal government could run out of cash to pay its bills, but Republicans in Congress want spending cuts in exchange for their support. If a deal is not reached, it could impact things like Social Security, 401Ks, and benefits for veterans.
“Things like Social Security checks and various welfare payments, they all depend on the government being able to spend money, the military, so it’s a big problem, a big issue, and it needs to be resolved,” said AIC Economics Professor John Rogers.
The debt ceiling or limit sets the maximum amount of outstanding federal debt the United States government can take on. The United States currently has a limit of $31.4 trillion, which was reached earlier this year. Rogers told us he expects conversations to remain ongoing until the June 1 deadline, but he believes this issue will have a longer-term effect on the economy.
“Everyone is confident this will be resolved in the short run. I think it does raise the longer run issue of the government consistently spends more than it takes in,” Rogers added.
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