White House Warns Debt Default Could Severely Damage US Economy, Resulting in Millions of Job Losses

On the eve of President Joe Biden's discussion with congressional leaders on the debt ceiling next Tuesday, the White House warned that a debt default could seriously damage the US economy or lead to the loss of millions of jobs. According to an analysis released Wednesday by the White House Council of Economic Advisers (CEA), a short-term default would result in the loss of 500,000 jobs, a 0.3 percentage point increase in the unemployment rate and a 0.6 percentage point decline in annualised GDP. If the default lasts a full fiscal quarter, the report said, the stock market would plunge 45 percentage points, GDP would fall 6.1 percentage points and the unemployment rate would rise 5 percentage points.