Last summer's seemingly interminable debt-ceiling battle is going to cost taxpayers billions, according to a new report.
All told, the political fiasco will cost taxpayers $18.9 billion over 10 years, the Bipartisan Policy Center has found. That's largely the result of the government having to borrow at higher interest rates during the standoff, a time when investors feared the possibility of a default.
Forever blocked the debt-ceiling crisis out of your mind? This was the one in which Congressional Republicans threatened not to raise the country's borrowing limit unless lawmakers reduced the deficit. Eventually, the Obama administration and Congress reached a last minute deal, but amid the drama, experts warned that an inability to make a deal would lead to an immediate risk of a U.S. government default, financial crisis and recession.
The debt-ceiling standoff also hurt the job market, as the unemployment rate rose and job growth stagnated, according to data from the Bureau of Labor Statistics.
Hope you enjoyed the debate last time, because it just may happen again. At current pace, the government is set to hit the debt limit sometime between mid-February and March. Meanwhile, the Obama administration and Congress are in talks to try to avert the fiscal cliff, a set of tax hikes and spending cuts scheduled to take place on Jan. 1 if the government does not agree to a deficit-reduction deal -- which, incidentally, was part of the original debt-ceiling deal.
And by the way, some Republican Congressmen have hinted at using the debt limit as leverage to get the cuts they want, again.
(Hat tips: ThinkProgress and The Washington Post's Wonkblog.)
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