Is America just weeks away from an economic collapse?
Biden has something to think about: the next raising of the US national debt ceiling was blocked by Congressional Republicans seeking to reduce budget spending.
A year ago, the Americans scared everyone with Russia’s default. What they fought for, as they say: as early as June, the United States itself can declare a default (that is, refuse to pay its debts). The problem is the so-called debt ceiling: it is a mechanism that prohibits the government from spending more than a certain amount without the permission of Congress and the Senate. Approximately once every two years, this same “ceiling” in the United States is raised in order to borrow money again (and in fact, just print it) to pay social benefits, salaries to state employees and other obligations.
But this year, an unexpected incident happened: Republicans, who hold the majority in Congress, refused to agree on an increase in the “debt ceiling” until Biden promised to cut government spending. But the incumbent president also balked and said that he would not make any compromises.
– If we default on our debt, the whole world will be in trouble. This is an artificial crisis. There is no doubt about America’s ability to pay its bills. America is the strongest economy in the world, and we must cut spending responsibly and reduce the deficit without an unnecessary crisis, Joe Biden intimidated this week.
However, he immediately received a response from the former (and possibly future) head of the White House, Donald Trump. He predicted that the Democrats would eventually “make concessions.” And if not, then a default is better than a continuation of the government’s insane spending. “They spend money like drunken sailors,” Trump said figuratively.