Economist Podcasts Raise the roof? America’s debt-ceiling debacle
6 snips
May 22, 2023 
Simon Rabinovich, The Economist's US economics editor, breaks down the urgent negotiations between President Biden and Speaker McCarthy over the daunting $31.4 trillion debt ceiling. He highlights the potential economic fallout from a possible sovereign default and the political challenges that complicate solutions. Meanwhile, John Fassman shares his delightful foraging escapades in the American Northeast, emphasizing the therapeutic joys of reconnecting with nature and the thrill of discovering wild edibles.
AI Snips
Chapters
Transcript
Episode notes
U.S. Default's Global Impact
- A potential U.S. default would have unthinkable consequences due to the dollar's status as a reserve currency.
- U.S. treasuries, seen as risk-free assets, underpin global markets, impacting everything from corporate cash to collateral.
Political Hurdles to Agreement
- Reaching a debt ceiling agreement involves navigating polarized politics.
- The narrow majorities in both the House and Senate empower fringe groups, complicating negotiations.
Workarounds Unlikely to Succeed
- Proposed workarounds, like minting a trillion-dollar coin, are gimmicks subject to legal challenges.
- Citing the 14th Amendment is also legally dubious, unlikely to be effective given the current Supreme Court.