The prospect of a federal government default is a daunting scenario that would have far-reaching consequences for every sector of society, but the impact of such an event would disproportionately affect marginalized communities, including Black Americans. Given the historical and systemic inequities this sector has endured, any economic disruption resulting from a federal default would exacerbate current disparities and further marginalize this already disadvantaged group. We explore the potential repercussions of a federal government default on Black people and highlight the need for proactive measures to mitigate these effects, which we estimate to be $132 billion in the case of a protracted default. (Note that our estimate does not include direct stock market impacts since only 34 percent of Black families own any equities according to the Federal Reserve Board, compared with 61 percent of White families. Our estimate also has a shorter time frame than other studies.) Economic ...
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