We know you’ve all been waiting for Mayor Greg Fischer to weigh in on the debt ceiling debate. No? Well, he did anyway.
In a press release this afternoon, Fischer urged “both parties, Democrats and Republicans,” to “put aside partisan differences and seal a deal that addresses the debt ceiling and balances a need for deficit reduction and job creation. Default would be a disaster for our country and have a trickle-down impact on our city.”
Well, that’s certainly an interesting take on why Congress hasn’t raised the debt ceiling yet. But here’s how he said the economic armageddon of default would effect Louisville:
- Interest rates will rise, increasing the costs of borrowing for the city, its residents and businesses;
- Credit ratings could suffer since a significant portion of the city budget is based on anticipated federal funding, increasing the cost to borrow; potentially affecting major projects such as the Ohio River bridges project.
-City federal funding, which involves draw downs from the Treasury, could end;
-Citizens who depend on the regular flow of federal funding (seniors, those in poverty and persons with disabilities) will suffer;
-Bondholders in the city, ready to redeem their federal bonds, will not be able to do so;
-City projects with mixed federal and non-federal funding could be stalled based on the federal side not being available;
-Federal workers in the city could be furloughed or suffer layoffs;
-Federal facilities in the city could suffer curtailed spending, thereby harming the local economy;
-Foreign investment in U.S. cities such as Louisville could suffer based on lack of confidence in our economy;
-The University of Louisville and its students, who have numerous arrangements with the federal government, would suffer the freezing or loss of such funding.
Meanwhile, Rand Paul says there will be no default, because he’s a very serious thinker and economic expert.
Mitch McConnell? Once again on the Senate floor claiming there is a person playing electoral politics with the debt ceiling. Yet again, he claims the person is not himself, and the video provides no laugh track: