Statement of U.S. Sens. Mark R. Warner and Tim Kaine on Need to Protect Virginians from Impacts of National Debt Default
Mar 29 2023
WASHINGTON – Today, U.S. Sens. Mark R. Warner and Tim Kaine released the following statement regarding the release of a Joint Economic Committee Democratic staff report outlining the devastating cost for Virginia of a potential debt default:
“No one wins when lawmakers play political games with a debt default. Every day that we don’t raise the debt ceiling inches us closer to catastrophic economic impacts that would be felt in every community in Virginia, including through higher mortgage payments and uncertainty for those relying on Social Security, Medicare, or veterans benefits. We will continue to urge our colleagues on the other side of the aisle to join us in protecting American families from the dangers of a default, and to stop holding our economy hostage.”
The report outlines how raising the debt limit is essential for the United States to continue to keep its promise to veterans, military personnel, and seniors and how a default would push up costs for families and small businesses and risk millions of jobs.
In Virginia specifically, the report estimates that even the threat of a debt default would increase monthly mortgage payments by an average of $151 per month, or approximately $54,000 over the course of a 30-year mortgage. Additionally, 1,598,000 Social Security recipients—whose monthly payments total over $2.5 billion—1,608,000 Medicare recipients, and 691,000 veterans in Virginia would be at risk of benefit disruption if the federal government does default on its debt.
In recognition of the additional risk shouldered by federal workers, whose incomes can be put in direct jeopardy by government shutdowns and a debt default, Warner and Kaine recently reintroduced the Federal Employee Civil Relief Act, legislation to protect federal workers and their families from foreclosures, evictions, and loan defaults during a government shutdown or debt default. The Federal Employee Civil Relief Act would enable government employees and contractors to postpone payment obligations during a shutdown or debt default and for 30 days afterward.