A bipartisan group of former US Treasury secretaries warned Congressional leadership Wednesday that waiting until the last minute to raise the debt ceiling raises the risks of an “accidental default” that would be disastrous for the economy.
“Even a short-lived default could threaten economic growth,” the letter to House Speaker Nancy Pelosi reads. “It creates the risk of roiling markets, and of sapping economic confidence, and it would prevent Americans from receiving vital services. It would be very damaging to undermine trust in the full faith and credit of the United States, and this damage would be hard to repair.”
The letter was signed by Henry Paulson, who served under Republican President George W. Bush, as well as four former Treasury secretaries under Democrats: Michael Blumenthal, Robert Rubin, Timothy Geithner, Larry Summers and Jack Lew.
“As former Treasury secretaries, we write to express our deep sense of urgency that Congressional leadership, working with the Administration and the President, move swiftly to initiate and complete a viable legislative process necessary to raise the debt limit,” the former officials said.
The letter acknowledges the polarized state of American politics – but stressed that shouldn’t cause a US default.
“For 232 years, our nation has consistently paid all of its bills, in full and on time,” the letter reads. “Unshakeable creditworthiness has long been a wellspring of strength for our nation, and protecting it is a sacrosanct responsibility. No Congress or President has allowed our country to default.”
Update: This post has been updated to reflect that Jack Lew also signed the letter.