The US Approaches Economic Disaster

The following story was written by a student on the staff of The Jaguar Times as part of Hilliard Bradley High School’s Journalism Production course.

by Max Matheny

Staff Writer

Congress is working to pass Biden’s Agenda while an economic crisis is looming, Image by Louis Velazquez.

This week is arguably shaping up to be the most if not one of the most important weeks for Biden’s Presidency. As Congress continues to argue over Biden’s domestic agenda, the federal government is on the verge of going into shutdown, meaning it would be unable to finance itself. This could cause millions of government workers and contractors to lose their jobs and income.

In addition to the shutdown, Janet Yellen, Biden’s Secretary of Treasury, warns of an imminent US default. A default would mean that the US government would be unable to pay their investors. If the US defaults, it would mostly cause panic among investors and might have lasting economic consequences. In the past, the US government has been able to pay investors in the past by taking more loans, however due to the debt cap, they are unable to do so. The debt cap was introduced during World War I to allow the US to take as many loans as it needed to when it was suspended. When it is in place, it keeps the government from overspending itself.

Earlier this week, house Democrats passed a resolution to suspend the debt cap. However Republican Senators have filibustered it, meaning that Democrats would be unable to pass it on their votes alone. This is in protest of Biden’s $3.5 trillion dollar partisan reconciliation bill which Democrats aim to pass without any bipartisan support. There have been talks around avoiding the shutdown but senate minority Mitch McConnell has so far refused to budge on the US default. Democrats could use the reconciliation process to push the suspension of the debt cap through to avoid a US default, however this would end any hopes of passing Biden’s complete $3.5 trillion dollar agenda.

Bradley government teacher Mr. Delbaccio says that he believes that both sides of the aisle will come to a deal to prevent the shutdown. He then goes on to say he’s more worried about the default and potential consequences of the shutdown, such as the closing of unessential facilities. Meanwhile, self-sustainable parts such as the Postal service will most likely remain active. With the US set to shutdown in less than 24 hours, and default by Oct. 18, this week could be the most important week in Biden’s presidency.