OFFICIALS LEGISLATION INTEREST GROUPS PUBLIC STATEMENTS COMMITTEES VETOES

Economic Consequences of Default

Floor Speech

Date: July 19, 2011
Location: Washington, DC
Issues: Government Budget and Spending

Ms. MOORE. Mr. Speaker, you've heard the so-called ``experts'' predict the economic consequences of default on the debt, but your question is, what does this have to do with me? And Gwen, can you please tell me what this means in plain English? For example, the Federal Reserve analysis that default would cause point increases in Treasury yields. Translation: Every point increase means the loss of hundreds of thousands of jobs--your job.

The economist William Seyfried said a 1 percent change in GDP growth correlates with .4 percent total employment change. Translation: Every percentage loss of GDP means 640,000 lost jobs--your jobs.

Default permanently raises the interest rates, says J.P. Morgan, and they estimate that interest rates could rise 75 to 100 basis points. Translation: Mortgages rise $1,000; credit card interest rises by $250. And the decline of the value of the dollar. Translation: $182 extra on your utilities, $318 a year on food, $100 a year more on gas. Do you get it?


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