And if a default does happen, Higgins said, “I hope it's for a short period.” Higgins said while she's hopeful that Biden and McCarthy can reach a compromise, she's concerned the deal will include Republican-sought budget cuts that would affect the organizations she manages. “And the inflation that has happened in the economy has already reduced our ability to stretch the dollar.” “We're already behind the eight-ball in what we're able to pay teachers,” she said of the organization's head start and early learning programs. "Yes, demand has gone up - but it was already up before," she said. With a possible debt default, she said, she's seeing more demand for food from the three pantries that the organization either runs or financially supports. House Speaker Kevin McCarthy, R-Calif., was asked Monday if people should start preparing for default, and insisted “no, no, no, no.”īut people on fixed incomes and organizations that serve the poor - already feeling the after-effects of the pandemic and dealing with inflation - are bracing for a potential debt default that would deal an overwhelming blow to their finances.Ĭlare Higgins, executive director of Community Action Pioneer Valley in Massachusetts, said demand at the organization's food banks has skyrocketed since the start of the pandemic, and is growing again. could default as soon as June 1, according to Yellen.
GOP lawmakers have been pressing for spending cuts in exchange for agreeing to increase the government's borrowing authority and President Joe Biden wanted a “clean” debt ceiling increase without conditions. Negotiations between the president and congressional leaders are down to the wire as they try to break an impasse. He hasn't made any drastic changes to the way he lives, but said, “I'm more conscientious of everything and I think about everything I do now.” Gault, who lives in Bradford, Pennsylvania, near that state's border with New York, said he thinks about the debate - and the stalemate - in Washington a lot. Robert Gault, 63, who depends on a $1,900 monthly Social Security disability payment, says an economic default “would make life so real awfully hard on me.” The former longtime factory worker said he suffers from chronic back pain caused by degenerating disks in his spine. economy if the debt limit is not raised and the government defaults, though only 21% said they’re following the debate closely. households included someone receiving Social Security benefits, 36% received Medicaid benefits and more than 13% of the total population received food stamps.Ī recent poll by The Associated Press-NORC Center for Public Affairs Research found that 66% of Americans said they’re very or extremely concerned about the impact on the U.S. According to the Census Bureau, in 2020 roughly 35% of U.S.
The number of people potentially impacted is huge. “A default could cause widespread suffering as Americans lose the income that they need to get by,” she said. Treasury Secretary Janet Yellen warned last week that a default would destroy jobs and businesses, and leave millions of families who rely on federal government payments to “likely go unpaid,” including Social Security beneficiaries, veterans and military families.
were to default on its financial obligations. Government beneficiaries, social service groups that receive state and federal subsidies and millions more across the country are contemplating the possibility of massive and immediate cuts if the U.S. Politicians in Washington may be offering assurance that the government will figure out a way to avert default, but around the country, economic anxiety is rising and some people already are adjusting their routines. “What I’m worried about is food banks and electricity here because you know, we’ve had deaths with seniors because of the heat,” says Cole.
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