Part 9/11:
Another critical issue to monitor is the potential impact of a divided Congress on the U.S. debt limit negotiations. The risk of the debt ceiling not being raised could lead to a government default—an outcome that would trigger a financial crisis with far-reaching global consequences.
Historically, debates over the debt ceiling have caused short-term disruptions. Notably, in 2013, such disagreements forced President Obama to cancel international trips, including engagements in Asia and Russia, as the administration concentrated on resolving the fiscal impasse. A failure to raise the debt limit today could similarly constrain U.S. international engagement and undermine confidence in its financial stability.