The U.S. could default on its debt as soon as June 1 if lawmakers fail to raise the federal debt limit. An impasse would have disastrous consequences for the U.S. economy by causing an economic downturn, threatening the U.S. dollar’s role as the world’s reserve currency, and further downgrading the U.S. credit rating, thereby raising debt costs for every business.
In an open letter last week, nearly 150 business leaders urged President Biden and top congressional leaders to reach a compromise, and we applaud them for speaking out. At the same time, it’s essential for business leaders to recognize that raising the debt ceiling is a short-term fix that ignores underlying root issues, including our country’s dysfunctional political system.
Year over year, the Harvard Business School's U.S. Competitiveness Project finds that political dysfunction is the greatest obstacle to our country’s economic competitiveness. The politicians in charge of America’s fiscal policy are more interested in scoring points than finding common ground and governing responsibly. Instead of working together on long-term fiscal solvency, legislators are too often focused on how their respective bases will vote in the next election.
As our politics become ever more disconnected from serving the people and producing results, the nation's competitive edge is slipping. Even if the impasse is resolved this time, short-term thinking and recurring threats of default will continue to dampen the business climate. The business community must take action to reverse these trends.
At Business for America, we are determined to help businesses understand the corrosive effects of hyper-partisanship on our society and economy — and to advance nonpartisan solutions that strengthen our country’s democratic institutions. We call on the American business community to join us in helping to boost voter turnout, improve civic literacy, build trust in our elections with improved security and access, and encourage bipartisan approaches to our nation’s challenges.
To find out what you and your company can do, please contact us.
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About Business for America
Business for America is a nonpartisan nonprofit business membership organization advancing solutions to boost civic engagement, reduce political polarization, and modernize government. A well-functioning democracy will foster a more competitive, innovative business climate in America. Businesses interested in getting involved can learn more at bfa.us.