Academic Experts Weigh in on US Government Shutdown

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Faculty Row asked members of its expert network to provide opinions on the US Government Shutdown and its potential global repercussions. With the October 17th deadline of default looming, here are their thoughts...

Super Professor David Schultz of Hamline University is a Political Science expert and professor at Minnesota schools of law:

"Were the debt limit not raised on time it would force the US to make a choice–pay foreign bondholders or Grandma’s Social Security check. Failing to do either would be financial or political suicide but my guess is that Grandma loses. It will not come to that. Congress and the president will do what they have done so well in the past–kick the political can down the road a few months, extending the debt limit and funding the government until right before the 2014 elections. And then we will again ask how we got where we are."

So what if Congress and the president cannot reach an agreement to end the partial government shut-down or worse, extend the debt limit? Is the country hopelessly stuck in the middle of a political dispute? Not necessarily. Ignored in the entire dispute is one obvious resolution – the Supreme Court. While some may argue that budget and finance matters are no place for the courts to venture, the partial governmental shutdown and the pending debt limit extension both represent controversies that have a legal or constitutional basis that can be addressed by the courts.*

For more on Schultz theory on the Supreme Court and the Government Shutdown visit: http://facultyrow.com/profiles/blogs/will-government-shutdown-end-with-a-supreme-court-ruling-1

Super Professor John C. Edmunds is an expert in International Economics. He is a professor at Babson College:

"U.S. Treasury bonds are used to collateralize transactions in some little-known corners of the finance world, for example letters of credit. Those guarantee payment in remote locations. So ships full of cargo can sail. If Treasury bonds are unreliable, the letters of credit might not work properly and goods would not move."

Super Professor Sean Q. Kelly of California State University, also an expert in Political Science states:

"No one should underestimate the possibility that the debt ceiling will not be raised, and that the country will default on its debt obligations. The Republican Party is so hopelessly internally fractured at this point that no single policy alternative can gain enough support to produce a partisan majority on the House floor. This crisis may come down to a choice for John Boehner: 1) sacrifice his Speakership—by moving a debt limit increase that fails to attract a majority of Republicans, passing with Democratic support and ending in an anti-Boehner revolt within the GOP—or, 2) sacrifice the country by allowing the debt ceiling to shatter, causing the country to stop paying its bills."

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Jeffrey Finder
@FacultyRow
since: 01/2010
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