U.S. Debt Ceiling Talks Don't Seem Personal to Americans

Fewer than half of voters think a U.S. debt default would significantly impact their personal finances, but economists disagree

U.S. Speaker of the House Kevin McCarthy (R-CA), joined by Rep. Patrick McHenry (R-NC), speaks to reporters following his meeting with U.S. President Joe Biden at the White House on May 22, 2023 in Washington, DC.

Alex Wong / Getty Images

39% - That's the portion of registered voters who think a default on the U.S. debt obligations would significantly impact their personal finances.

The highest portion of respondents to a Morning Consult survey said if the U.S. was to default on its debt it would be a major problem, while an additional 28% said it would cause minor issues. Another 13% said it wouldn't cause any problems for them, and about one-fifth weren't sure how it would impact their finances.

Larger portions of those surveyed thought a debt ceiling breach would hit close to home, with more than three-fourths of registered voters saying at least some negative impacts would trickle down to their local economy. Most respondents agreed that a default would hurt the U.S. as a whole, with only 4% saying there would be no impact at all on the broader economy.

As debt negotiations between Democrats and Republicans sputter ever closer to the June 1 estimated breach, many entities are shoring up their finances. Companies are saving up cash to cover payroll, states are evaluating their Treasury holdings, and investors are shoring up liquidity.

While a default may be the least likely outcome of this month's debt negotiations, it would be the most harmful. Economists say a debt ceiling breach would spark a recession—costing millions of jobs and creating decades-long issues for the country. A breach would also have international implications, economists say.

Outside of a recession, individuals may feel the impacts of a debt ceiling breach in the form of less valuable retirement accounts or more difficult and expensive borrowing, said Moody's Chief Economist Mark Zandi in a television interview Wednesday.

"Everyone is going to get hurt," Zandi said. "It's just a matter of degree."

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
  1. Morning Consult. "National Tracking Poll 2305047." Page 34.

  2. Twitter. "@CNNThisMorning-May 24."

Open a New Bank Account
The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.