The White House Council of Economic Advisers is warning that if the US government is allowed to default on its’ sovereign debt, it would trigger a recession comparable to the “Great Recession,” which occurred as a result of the 2008 financial crisis, and would leave the government unable to do anything about it.
An analysis by CEA economists published by the White House on Thursday shows that a failure by the government to pay its’ bills — even temporarily — would cause the US economy to “would quickly shift into reverse, with the depth of the losses a function of how long the breach lasted”.
