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Publisher's Note: If you think the
debacle in Washington doesn't affect
you, read this report from
Stateline.org:
If the federal government begins defaulting on its obligations
next week, it will clearly have some
impact on states. The question
nobody knows the answer to is: How
much? A lot would depend on how the
U.S. Treasury decides to prioritize
its payments, as this
analysis from the Bipartisan
Policy Center makes clear.
In some scenarios, programs that states rely heavily on federal
dollars for, such as Medicaid, food
stamps or welfare, could get short
shrift. In other scenarios, economic
damage could ripple out through
states if federal employees don’t
get paid, veterans don’t receive
benefits or retirees don’t see
Social Security checks. States also
are concerned about their access to
credit markets.
Moody’s has warned five states that if the federal government
loses its Aaa bond rating, they
likely will, too. Maryland is one of
them. As Warren Deschenaux, director
of the Maryland Department of
Legislative Services, puts it,
“About all we can do is wait and
worry.”
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