While White House and Congress Works to Avoid Disastrous Debt Default, IFPTE President Biggs Shares Grave Concerns for Economy, Workers, and IFPTE Members' Jobs
IFPTE President Matthew Biggs spoke to the Kansas City Star and the Washington Post this week to express the union’s grave concerns about the fallout a U.S. debt default would cause across the American and global economies. With the U.S. Treasury expected to exceed the debt limit on June 1, President Biden and the White House is continuing negotiations with House Speaker Kevin McCarthy (R-CA) and Republican leadership to avoid a recession triggered by a debt default.
A U.S. debt default is an unprecedented and entirely avoidable situation. Since 1960, Congress has raised the debt limit 78 times. Unfortunately, House Republican leadership is withholding support for a clean debt limit increase in exchange for multiyear budget spending caps that will cut spending for programs and services that veterans, retirees, working people, and lower-income Americans count on.
On Tuesday, President Biggs told the Kansas City Star that, “Economists across the political spectrum, they all agree that if the U.S. defaults on their debt, it would have a huge, negative ripple effect all across every aspect of the economy.”
On Friday, President Biggs spoke to the Washington Post about the direct impact to federal workers and private sector workers employed at government contractors, noting that members working for the federal government are “more worried about a default than they were about a government shutdown.”
Even a deal to avoid a default right at the deadline can have a significant negative effect on the economy, harm the credit rating of the United States, and impact retirement savings. Speaking to the threat to federal employees’ retirement security, President Biggs told the Washington Post,“Even if they reach a deal, it doesn’t mean their TSP [Thrift Savings Plan] won’t be depleted.”
Currently, as negotiations continue between the White House and Republicans, it is possible that an agreement will be reached by Memorial Day to extend the debt limit in exchange for capping non-defense federal discretionary spending for two years, repealing increased IRS funding, and rescinding unspent COVID funding for states and localities.
Read IFPTE President Matt Biggs quoted in the Kansas City Star article “Economic Catastrophe’: Debt Default Would harm Kansas City Federal Workers, Retirees,” and in the Washington Post article “Anxious Federal Workers Find Few Answers on Debt Ceiling.”