What happens if the government defaults on the deficit?
By Stan Escudero of Daytona Beach ShoresThis Tuesday, Aug. 2, the supposed drop dead date for raising the debt ceiling, is really getting close now. If you listen to the news anchors on television, you probably think that the United States will automatically default on its debt on that date. This is not true.
The United States would default next week only if it declared that it is unable to pay its debts and then failed to pay the interest on the debt due on August 2nd – approximately $29 billion. That will not happen.
By August 2nd the government will have about six times as much in tax revenues as it owes in debt interest and the very first thing it will do is pay that interest whether the debt ceiling is raised or not.
The problem we will have if the debt ceiling is not raised by August 2 or soon thereafter is that the government will not have enough money to pay all of its bills. If the ceiling is not raised, we cannot borrow and, if we cannot borrow, the amount of money available to the government decreases by 42% of the budget (or what the budget would be if we had one).
MAYOR'S MESSAGE
Courtesy photo / Robert Olen Butler.jpg)
NSBNews.net photos by Sera Frederick / On the drawing boards for five years-plus, the proposed Hampton Inn & Suites is the new reality for historic Flagler Avenue in New Smyrna Beach. The developer is South Carolina-based David Swentor (with hand out to the drawing) shown here with CRA Director Tony Otte during a public hearing earlier this year.
NSBNews.net photo illustration by Sera Frederick .jpg)
.jpg)
.jpg)
Courtesy photos / The man shown in these gruesome photos is none other than Henry Ford Wheeler, greater New Smyrna Beach's notorious ex-con who got beat up in a beachside bar. Wheeler made headlines last year by costing then-County Judge Mary Jane Henderson her seat on the bench in the November elections after she tried to help him turn his alcoholic life around, only to see him continue getting into trouble, including being at the center of a murder.