Defaulting on debt is the fastest way to turn the US into a third world country. Banks would fail, since they invest our deposits in long-term assets including

Defaulting on debt is the fastest way to turn the US into a third world country. Banks would fail, since they invest our deposits in long-term assets including treasuries. Companies typically store their cash in treasuries and money markets, so companies would go under (or have to issue more shares under duress), crashing the stock market. Retirees would stop receiving Social Security payments, and retirees' nest eggs are normally mostly bonds. The US would piss off other countries who lent us money, who'd come knocking with a country-scale baseball bat demanding their money. But two thirds of that $35T is owed to Americans. There'd be a good chance of either a civil war or global war. We'd likely lose our status as the world's reserve currency, devaluing the dollar and leading to inflation. Nobody would trust the government enough to lend them money, so they'd have no choice but to print money to pay expenses at this point. So, we'd have inflation either way.