During the pandemic, Nevada faced some of the worst economic conditions the state had ever seen. It has the highest unemployment rate in the nation, and thousands of Nevadans sought emergency food and rent assistance. Moreover, countless small businesses were forced to close their doors in the wake of the pandemic’s economic fallout. Under the leadership of Zach Conine as State Treasurer, great strides have been made since 2020 to get the state’s economy back on track. Nevada’s credit rating is still the highest it has ever been, and the Rainy Day Fund is at an all-time high. The Treasury Department generated an additional $182 million in investment returns, beating expectations set by the Economic Forum.
Unfortunately, if Republicans in Congress continue to threaten to default on the national debt, all the economic progress made for families in Nevada will be ruined in an instant. Conducting politics based entirely on trust and credit is dangerous and financially irresponsible. However, this is precisely what Republicans are doing by holding the economy hostage and trying to force deep and harmful budget cuts on programs that are sacred to people across Nevada.
Across the country, far-right politicians are talking about fiscal responsibility while arguing that the United States should not pay its bills. Republicans are not the only ones involved in the debt ceiling issue. Just last week, Former President Donald Trump said the United States should default entirely. Similarly, Gov. Joe Lombardo told the Las Vegas Review-Journal in January that he did not think the federal government should raise the debt ceiling.
As Nevada’s chief financial officer, Zach Conine is responsible for keeping the state’s financial base strong. He cannot help but wonder how dangerous this kind of rhetoric is and what the consequences are for all of Nevada, regardless of party affiliation. If the US were to default on its debts, interest rates for ordinary Americans would rise almost immediately, unemployment would skyrocket, and critical public funding programs like social security and Medicare would be difficult to fund.
Experts expect the debt ceiling to be reached within the next three weeks. Unfortunately, Republicans in Congress are looking to either default the country or inflict severe economic damage on working families, students, retirees, and the disabled. The recent Republican bill to raise the debt ceiling contains a disturbing list of cuts and attacks that are highly unpopular with most Americans. This contrasts sharply with President Joe Biden’s plan to raise the debt ceiling cleanly without any extraneous policies.
The Republican plan will result in moving manufacturing overseas, stealing thousands of high-paying jobs, and threatening the more than 9 million jobs expected to be created over the next decade by President Biden’s Inflation Control Act. In fact, Moody’s Analytics found that the Republican proposal “significantly increases the likelihood” of a recession, resulting in 780,000 fewer jobs by the end of 2024 compared to the clean debt ceiling hike demanded by President Biden.
Moreover, the Republican bill cuts education funding, which would leave the state losing more than $40 million a year in funding for Title I schools while exacerbating Nevada’s teacher shortages in areas most in need. More than 1,800 preschool and childcare quotas will also be abolished, and Pell subsidies for more than 38,000 university students will be significantly reduced.
With the rising energy costs and prices, the Republican plan is to raise utility bills and taxes for working families, while removing health insurance from millions of Americans. The crux of the matter is that Republicans in Congress “either force America to default and trigger a recession, or else take away healthcare, cut education, and take away more than 100,000 jobs.” This proposal is unpopular, extreme, and dangerous.
Congress needs to act now instead of politicizing the national debt ceiling. We need to send a signal to financial markets and the world that the United States will pay all bills when they are due. Anything below that could hurt the economy like never before. If Congress passes an explicit increase in the debt ceiling, Congressional leaders can work together throughout the budget process to identify the best use of public funds.
However, statements that threaten economic collapse at the expense of workers, children and retirees should not be discussed in our public forums. Zach Conine currently serves as Nevada’s 23rd Treasurer.