Congresswoman Eddie Bernice Johnson Votes to Avoid Republican Default

Washington, DC – (Tuesday, February 11, 2014) – Taking bipartisan action to put an end to the GOP manufactured budget crises that have plagued Washington, Congresswoman Eddie Bernice Johnson voted to protect American families from the cost of a dangerous Republican default by taking action on the debt limit.  A debt limit increase simply allows Treasury to pay the bills for spending Congress has already approved and does not add one cent to the deficit.

The need for today’s action is highlighted by a new analysis by Ways and Means Committee that shows the consequences families in Texas would face under a Republican default. The new analysis shows the damaging effects of default on tax refunds, mortgage rates, retirement savings, Social Security, veterans’ disability and pensions, student loans and Medicare.  That is it is crucial to the American families and businesses that some Republicans have stopped holding hostage the full faith and credit of the United States.

“Defaulting would put an enormous financial strain on American families, from higher interest rates for mortgages and credit cards to lost retirement savings to delayed Social Security payments and tax refunds, particularly here in Texas,” said Congresswoman Johnson. “Economists of all political stripes are warning about the potential consequences of default. With just days left, I am glad that some Republicans have taken that prospect seriously and today we have voted on a bipartisan basis to stop playing political games with the full faith and credit of the United States and the livelihoods of American business and families.”

The new analysis shows that mortgage rates could rise dramatically during a default, pushing up overall home loan costs. Retirement savings are expected to fall significantly, potentially costing the average person in Texas a drop of $15,000 in 401(k) assets and almost $23,000 in IRA assets just as they did in July and August 2011, when Republicans pushed the U.S. to the brink of default. 3,657,907 Social Security recipients here in Texas may not get their monthly checks, 299,877 disabled veterans may not get their pensions, and tax refunds could be delayed, with the Treasury Department unable to borrow. Student loans could cost significantly more. And doctors and hospitals may not get paid for treating patients with Medicare.

The full Texas analysis is available here.

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U.S. Representative Eddie Bernice Johnson is the ranking member of the House Committee on Science, Space, and Technology and the highest-ranking Texan on the House Committee on Transportation & Infrastructure. She represents the 30th Congressional District of Texas, which includes Downtown Dallas, Fair Park, Kessler Park, Old East Dallas, Pleasant Grove, South Dallas & South Oak Cliff; all of Cedar Hill, DeSoto, Duncanville, Hutchins, Lancaster & Wilmer and parts of Ferris, Glenn Heights, South Grand Prairie, Oak Lawn, Ovilla, Uptown/Victory Park and West Dallas.