Bloomy: Pols using debt crisis for posturing, holding U.S. hostage
Mayor Michael Bloomberg lashed out at federal lawmakers deadlocked over the debt crisis Tuesday, accusing them of holding America “hostage” to political “posturing” and putting the Big Apple’s economy at risk.
The billionaire businessman mayor warned that: “If America, for the first time in its history, defaults on its obligations, it would have a catastrophic effect on our financial system and on our credibility around the world.”
During an unrelated news conference in Queens, Bloomberg noted that while the city is slowly recovering from the 2008 financial crisis, “defaulting on our debt, I think would be a huge setback.”
“America’s good name and credit are just too important to be held hostage to Washington gridlock,” he said. “They’re all going to have to, in the end, stop what I would argue is posturing.”
President Barack Obama and Congressional leaders have been embroiled in a months-long battle about how to meet an Aug. 2 deadline to raise the country’s debt ceiling or allow for a government default for the first time.
A default would have serious repercussions for New Yorkers, said bankruptcy attorney Julio Portilla. A government that doesn’t have its finances in order would alarm investors and banks, which may lose confidence in lending and put the dollar at a disadvantage competitively.
“It would create a huge domino effect, not just for corporations, but for people receiving Social Security benefits and other government aid,” Portilla added.
Kyle Kondik, a political analyst at the University of Virginia’s Center for Politics, said voters are watching and the outcome could play into next year’s elections.
“If you’re Joe voter out there and you see this bickering going back-and-forth, and there is some sort of meltdown, imagine what that’ll do to people’s confidence in Washington,” Kondik said. “It’s not very high right now.”