Let’s start by looking at the observed facts:
A legislature is a place that passes legislation. If a legislature doesn’t legislate, is it a legislature? If not, what sort of credibility should it have?
Is “grovelling, sycophantic tantrum factory” a synonym for legislature?
Does a system which produces nothing but endless financial disasters for years on end deserve to survive?
A major US default would send a sequence of gigantic hits through the financial system. Cash won’t be there. Balances will turn into fiction. Big money shortfalls will cascade through the markets. Banks will crash like 1929 and 2008 were just kindergarten recitals.
Result- Global crash, and a big one, if it turns into a rout. Remember that panic is the only working behavioural pattern in this environment.
The safe havens may also collapse in a really bad crash:
Even the 1% may find themselves effectively worthless. What value is an asset nobody can buy? Only what can be paid for it.
Gold prices can also crash. Lack of money means lack of ability to buy.
In fairness, the US has never defaulted. Just about everyone else has. The Soviet Union died of debt and fiscal mismanagement. The problem is that nobody else is able to crash the entire global system in a matter of seconds. The US isn’t just any nation. Its status as the major cash cow is now in question. 60% of the world’s capital is tied up in this super-poor superpower.
Which raises a question never raised before- If a mortgagee defaults on a mortgage, they lose their home. They lose their assets. They may have serious restrictions placed on them if the net effect is bankruptcy. What about a super power?
So how do other nations handle the Humpty Dumpty impact?
Not financially. That option’s closed. Legally. Foreign investors may have recourse to legal action external to the US. Foreign creditors may have legitimate claims against default values. This would involve literally millions of legal actions.
Can/will US financial companies be penalized? Can US debt be quarantined from the global market? Can trade protection be used to keep local economies insulated?
Should foreign investors bail out of the US?
Should the international financial treaties be renegotiated or simply dropped?
Should trade treaties be scrapped?
Should individuals be held directly accountable under international law?
Should trade penalties apply relative to the damage done by defaults?
Or are we all expected to go broke and lose hundreds of billions on principle? Some deal, don't expect to see it ever again.
Do you see any possible good results out of these scenarios?
Do you see any alternatives to protective moves for other nations? Europe will crash straight after the US. The EU is closely linked. China is linked but has wider markets and more options, but most of the capital comes from the US/EU axis. China’s exports will evaporate.
This can all happen in a day or so. Congress needs to be aware that whatever happens as a result of a major default cannot be good for anyone.
The bottom line- America may not expect much from this collection of candy-ass juvenile delinquents it has running things politically and in the corporate sphere, but the rest of the world has legal agreements. This is business. It’s our
business. Stop screwing around and get down to business.
Whether it’s trillion dollar coins
or a nice bit of writing down, do it and get this useless, unnecessary mess out of the way. It’s literally holding up the whole planet. Get that damn dino-revenue system up to speed with what every other nation has been doing for decades, for one thing.
A suggestion for future reference- How does the world feel about performance-based pay for politicians? They’d owe a fortune. Could pay down a lot of debt, too.