(NationRise.com) – Democratic Connecticut Representative Jim Himes said on Sunday that Russia and China are currently in a position to “exploit” a possible US default, which Treasury Department Secretary Janet Yellen said could take place on June 1st. While experts point out this is unlikely, they warn this situation could lead to an economic crisis that will not only suffer the United States but also many other nations around the world.
During an interview with CNN’s “State of the Union,” Himes, who is also the top Democrat on the House Intelligence Committee, said that if Washington gets into this situation, Moscow and Beijing “would seek to exploit it.” He added that even when the country has never defaulted on its debt, this would be “catastrophic” as the United States’ solidness is one of the main reasons why the global financial system works the way it does.
He also said that “all kinds of things could happen” if the US defaults. Himes explained that the US dollar could be eroded, and many would prefer investing in the United Kingdom or the European Union. He concluded by stating that President Joe Biden and Republican House Speaker Kevin McCarthy need to find a solution over the next few weeks.
Following Yellen’s announcement, many pointed out this was good news as there was enough time for McCarthy and President Biden to reach a deal and prevent the country from defaulting on its debt. So far, the Biden administration has demanded a “clean” increase without any spending cut, while GOP members have pushed for these cuts along with a debt limit increase.
A default might represent a significant hit to the banking system, causing a domino effect in which many countries would suffer economic crises. Political analysts have been claiming this is a scenario that would also affect Russia but could be capitalized on by China in the midterm.
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