>> REPORTING FROM BROAD HEAD, I
AM ZACH SCHULTZ FOR "HERE & N
NOW."
>> LAWMAKERS SCRAMBLING TO MAKE
DOWN TO A WIRE DEER TO RAISE THE
DEBT LIMIT.
WHAT WOULD A NEAR DEFAULT MEAN
FOR WISCONSIN'S ECONOMY?
WE TURN TO WISCONSIN DEPARTMENT
OF REVENUE SECRETARY PETER
BARKA.
>> WHEN IT COMES TO A CLOSE OF
THE U.S. GOVERNMENT GOING INTO
DEFAULT, DOES REACHING THE EDGE
DO ITS OWN KIND OF DAMAGE?
>> CERTAINLY DOES.
2011 LAST TIME THEY CAME UP TO
EDGE OF DEFAULT, UNDER OBAMA
ADMINISTRATION, AAA TO DOUBLE A
PLUS NEVER ELEVATED AGAIN.
IF THEY DO THIS AGAIN VERY WELL
COULD SEE ANOTHER DOWNGRADE,
CATASTROPHIC IN MANY WAYS.
FIRST OF ALL, COST MORE FOR THE
FEDERAL GOVERNMENT TO BORROW.
SECONDLY, MARKETS ALWAYS TIP.
MEANS FOR SENIORS, WHO ARE
DEPENDING ON 401KS, THEY GET
WORRIED AND TAKE A DIP.
BEING CLOSE IS BAD ENOUGH.
IF THEY DEFAULT, WE ARE TALKING
ABOUT SIGNIFICANT PROBLEMS,
16,400 JOBS LOST IN WISCONSIN
ACCORDING TO LOUISIANA
ANALYTICS, DECLINE IN PAYROLL.
WITH HOLDING TAXES GO DOWN,
CORPORATE TAXES GO DOWN.
IT WOULD HAVE AN EFFECT ON
WISCONSIN AS WELL.
>> WHERE AND WHY ARE THOSE JOBS
LOST?
>> WHAT ENDS UP HAPPENING WHEN
THE MARKETS SUFFER, THAT IS THE
FIRST STAGE.
INVESTMENT DOLLARS ALSO START TO
DRY UP.
SO BUSINESSES THAT MAYBE WERE
GOING TO EXPAND OR DEPENDENT ON
HAVING EXTRA CAPITAL ALL THE
SUDDEN HAVE TO LAY PEOPLE OFF.
THAT IS THE OTHER DEVASTATING
THING.
EFFECT IS UNEVEN.
EFFECTS SENIOR CITIZENS
DEPENDING ON INVESTMENT INCOME.
YOUNG PEOPLE FIRST ONES TO BE
LAID OFF.
IT IS NOT EVEN IN EFFECT THOSE
PEOPLE ARE MIDDLE INCOME YOU
KNOW, EDGE OF SOCIETY.
THEY ALWAYS GET HURT THE WORST.
>> THEN THERE IS THE SPECIFIC
VERY INSTANT EFFECT, RIGHT OF
PEOPLE POTENTIALLY NOT GETTING
SOCIAL SECURITY CHECKS?
>> OF COURSE.
THAT IS NOT EVEN LOOKING AT
THAT.
IF IN FACT, THEY DO DEFAULT,
THEN THE TREASURE SECRETARY HAS
TO START TRIAGING AND MAKING
DECISIONS IF YOU ARE GETTING
SOCIAL SECURITY CHECKS OUT ON
TIME.
WHETHER OR NOT PEOPLE ARE JUST
ABOUT TO QUALIFY FOR MEDICAID OR
MEDICARE.
OF COURSE LOTS TO HEAR ABOUT
VETERANS AND THEIR BENEFITS.
IT IS AN INCREDIBLE RIPPLE
EFFECT.
PART THAT IS SO SAD IT IS SO
UNNECESSARY.
THREE TIMES IN THE TRUMP
ADMINISTRATION THEY DID THIS.
I THINK OF IT AS A FAMILY.
WHEN OUR CREDIT CARD BILL IS
DUE, I AM NOT GOING TO PAY SO I
PAY INTEREST IN PENALTIES.
PAY YOUR BILLS WHEN THEY ARE DUE
AND MAKE DECISIONS BUDGET
PROCESS, APPROPRIATE SPENDING
TAX RELIEF.
ABSOLUTELY NO REASON WHY THEY
NEED TO DO THIS AT THIS
JUNCTURE.
IT IS AT A VERY PERILOUS TIME.
FEDS INCREASING INTEREST RATES.
WE SAW FOR FISCAL BUREAU.
SLIGHT DIP IN TERMS OF SURPLUS.
YOU WORRY ABOUT TRAJECTORY.
>> SO MOODY'S SAYS IT IS NOT
LIKELY IT IS GOING TO HAPPEN.
TREASURY SECRETARY JANET YELLEN
SAYS HOLD ON PEOPLE, JUNE 1 IS
THE DAY.
SHE IS SOUNDING THE ALARM ON
THIS.
>> RIGHT.
>> WHAT DO YOU THINK?
>> KNOWING WE DON'T WANT TO GET
UP AGAINST THAT LAST DAY OR TWO
IN CASE IT TAKES LONGER TO GET
THE VOTES OR GOES SOUR.
WE ARE PLAYING WITH FIRE.
PLAYING WITH PEOPLE'S LIVES,
ECONOMY, AND EFFECT ON SO MANY
FAMILIES, I JUST HOPE TO
GOODNESS THEY ARE ABLE TO DO
SOMETHING IN THE NEXT WEEK.
>> SPEAKING OF MCCARTHY AND HIS
CAUCUS AND MEMBERS, IS IT WORSE
NOW, THIS KIND OF UP TO THE
BRINK?
>> I THINK IT IS BECAUSE YOU
KNOW, IN THE PAST, WHETHER
DEMOCRAT, REPUBLICAN SPEAK OR
MAJORITY LEADER IN THE SENATE,
GENERALLY SPEAKING, MEMBERS
TRUSTED LEADERS AND VOTE
ACCORDINGLY TO WHATEVER VOTE IS
REACHED.
WHEN MCCARTHY AGREED TO BECOME
PART OF THE -- HE HAS TO BE ALL
THE MORE CAREFUL ABOUT WHAT DEAL
HE STRIKES.
I AM SURE HE MUST HAVE TO BE ON
THE PHONE CONTINUALLY.
>> HAVE WE SEEN ANY INDICATION
YET BECAUSE WE ARE SO CLOSE TO
THAT JUNE 1 DATE IN MARKETS OR
ANYTHING LIKE THAT?
>> OUR ECONOMISTS WATCHING THIS
CLOSELY.
WE ARE VERY NERVOUS OURSELVES.
WE DO NOT WANT TO SEE AT A TIME
WHEN WISCONSIN HAS NOT BEEN
STRONG.
WE DO HAVE AAA BOND RATING.
LOWER NUMBER OF PEOPLE