July 27, 2011 at 06:00 AM EDT
U.S. Debt Default Would Be Worse Than Lehman Brothers Collapse
Each day that passes without a deal to prevent a U.S. debt default brings the United States closer to a financial calamity that would be more severe than the failure of Lehman Brothers in 2008. Dueling speeches from U.S. President Barack Obama and Speaker of the House John Boehner, R-OH, Monday night did nothing to resolve the impasse between Republicans and Democrats over how to reduce budget deficits and raise the debt ceiling past the $14.3 trillion limit by Aug. 2. The contentious rhetoric of recent days has raised concerns that lawmakers will fail to reach a compromise by the deadline - with disastrous consequences. "I've never, never seen a breakdown like this," Paul Light, a U.S. government scholar, told Reuters . "This is a defining moment in America's inability to act." Should the deadlock over avoiding a U.S. debt default endure past Tuesday's deadline, it will trigger a financial crisis of vast proportions: Click here to continue reading...
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