How a potential debt default could impact you - Fox 28: South Bend, Elkhart IN News, Weather, Sports

How a potential debt default could impact you

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A potential debt-default is right around the corner and you could be impacted.

Retired Veteran Marvin Ingram says he depends on the government to get his retirement check every month. "I don't receive my retirement check on the first, that means I can't pay my rent and I can't buy food and I can't pay my bills."

He says he is disappointed a default is even a possibility. "The default is going to hurt a lot of people, a lot of veterans like me."

Notre Dame Economics Professor Marty Wolfson agrees and he says if a default becomes a reality EVERYONE will be impacted. "Some people won't get paid what they expect to get paid. These could be people on Social Security, this could be HeadStart, this could be money to keep the National Parks open."

He says lawmakers have until Thursday to raise the debt ceiling in order to pay for all their obligations. If they don't? Wolfson says, you'll notice. "We're not talking about a mild recession, we're talking about a possible depression."

He says there would be no money for social security, medicare, or government funded research. He says we would see the interest rate jump and the stock market plummet. "People will lose their jobs, this will have a very serious effect on the economy."

With people jobless or missing a paycheck, Wolfson says that means they'll be spending less. "The economy will retract. This will have a very devastating effect, first of all people won't get the money they need to meet their needs."

People like Ingram. "I'm hoping there's something figured out, but it shouldn't have went this far in the first place."

Wolfson says this uncharted territory, so it's not completely clear how things will play out. He predicts the financial markets would react immediately, but other impacts, like prices on consumer goods, would take a little more time to react.

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