A recent survey by Fox News revealed that more than half of the Americans would prefer a government shutdown rather than raising the debt ceiling further. The US sovereign debt is fast nearing its ceiling of $14.3 trillion, with the debt increasing at an astounding rate of $14.7 billion per day!
US President Barack Obama is hopeful of striking a deal on the budget. He has warned that a government shutdown can have catastrophic consequences for the economy. Meetings with Republican and Democratic leaders at the White House to discuss the fiscal 2011 budget have not yielded anything substantial yet. There are still uncertainties about ways to bring down the budget, most of which have little hope of finding popular support.
The scenario brought the government close to a shutdown on Friday. If a practical solution to help the US economy is not found out soon then even the stopgap measures to fund the government would be of no help after it expires. We need to wait and see whether the US treasury's
debt management plan to save the country from an economic downfall would be fruitful.
In times of severe recession that the US is now facing, Obama said that a shutdown was the “last thing” that the US economy needed.
The Democrats and the Republicans are having a hard time striking a deal to address the ever growing fiscal problem. Obama said that John Boehner, Republican Speaker of the House of Representative and Harry Reid, Senate Democratic leader would meet again on Tuesday to continue discussions. If no solution could be arrived at, then Obama would call a meeting in the White House again on Wednesday.
The President announced that he will call meetings and discussions as long as the debt crisis is not resolved. He said that there is also the possibility of negotiating over the composition of cuts.
Perhaps, this is the most precarious situation for the US government. According to Fox News, close to half of the US people hold a low regard for the government and, therefore, they strongly support a government shutdown.
There is a high possibility that the government will raise its debt ceiling further. Whether it would help to control further damage to the economy is something only time can tell.