Two Charts That Show Why Another Debt Ceiling Fight Is A Very Bad Idea

Since Republicans in Congress seem intent on flirting (again) with hitting the debt ceiling, the Joint Economic Committee's Democratic staff is out with a report reminding us that doing so is a terrible, horrible, no good, very bad idea.

Here's what happens when you lead the financial markets to think the U.S. government might fail to pay its obligations:

• Your debt gets downgraded (Standard & Poors cut the U.S. sovereign bond rating to AA+ as a result of the last crisis).
• The stock market plunges (down 16% in three weeks during the last debt ceiling crisis).

Joint Economic Committee Democratic staff

• Consumer confidence falls, which means people don't buy as much and the economy slows down. Last time, a deal to raise the debt ceiling was reached in August, but consumer confidence didn't reach pre-crisis levels until January 2012.

People arguing about economic policy talk a lot about "uncertainty," and usually they're B.S.ing. But the debt ceiling is one of the few topics where uncertainty is really the big deal.

When the government risks creating a payment crisis, people start to wonder whether they're going to get their Social Security checks or their paychecks or their bond interest. And they wonder what broader effects a payment crisis may have on the economy.

All that causes people to stop spending and prepare for crisis. It slows down the economy. And it makes us look stupid, as a country. We shouldn't do it.