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Geithner Predicts Double-Dip if Congress Fails to Lift Debt Ceiling

Posted By admin On May 14, 2011 @ 1:30 pm In Money Watch | Comments Disabled

Stacy Kaper
National Journal [1]
Saturday, May 14, 2011

Treasury Secretary Tim Geithner said if Congress fails to lift the debt ceiling and the U.S. defaults on its obligations “this abrupt contraction would likely push us into a double dip recession,” painting the most explicitly dire prediction to date of the consequences of inaction.

In a heavily-anticipated response to Sen. Michael Bennet, D-Colo., who asked Geithner to document the economic and fiscal impacts of failing to lift the statutory debt limit, the Treasury secretary detailed a chain reaction that would cripple the economy, costing jobs and income.

“A default would inflict catastrophic far-reaching damage on our nation’s economy, significantly reducing growth and increasing unemployment,” said Geithner in the letter to Bennet which was dated May 13. “Even a short-term default could cause irrevocable damage to the economy.”

Geithner has imposed an August deadline for Congress to lift the $14.3 trillion debt ceiling, but lawmakers are still negotiating over Republican demands to tie the move to spending cuts. And a portion of the GOP still remains skeptical about the need to act by the deadline at all, arguing that the consequences have been overstates.

Full story here. [1]

Geithner Predicts Double Dip if Congress Fails to Lift Debt Ceiling 030511banner3 [2]

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URLs in this post:

[1] National Journal: http://nationaljournal.com/economy/geithner-predicts-double-dip-if-congress-fails-to-lift-debt-ceiling-20110514

[2] Image: http://www.stansberryresearch.com/pro/1103PSIEOAVD/PPSIM375/PR

[3] Stock up with Fresh Food that lasts with eFoodsDirect (AD): http://www.efoodsdirect.com/

[4] Default ‘Off the Table,’ Debt Deal Will Be Struck: Geithner: http://www.prisonplanet.com/default-off-the-table-debt-deal-will-be-struck-geithner.html

[5] Senate Attempt To Block Debt Ceiling Increase Fails: Debt Target Is Now $15.2 Trillion, Or Over 100% Of GDP: http://www.prisonplanet.com/senate-attempt-to-block-debt-ceiling-increase-fails-debt-target-is-now-15-2-trillion-or-over-100-of-gdp.html

[6] Geithner asks Congress for higher U.S. debt limit: http://www.prisonplanet.com/geithner-asks-congress-for-higher-u-s-debt-limit.html

[7] In Reversal, House G.O.P. Agrees to Lift Debt Limit: http://www.prisonplanet.com/in-reversal-house-g-o-p-agrees-to-lift-debt-limit.html

[8] Total US Debt Hits $16,369,548,799,604.93; Debt Ceiling Just $63 Billion Away: http://www.prisonplanet.com/total-us-debt-hits-16369548799604-93-debt-ceiling-just-63-billion-away.html

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