The crisis may have been averted, but experts said Floridians will hear about the federal debt limit for a long time to come.
“This isn’t over,” said Susan MacManus, a political expert with the University of South Florida in Tampa.
The U.S. Senate passed emergency legislation Tuesday to avoid a government default. The vote came one day after the U.S. House of Representatives passed a similar bill.
The measure — a compromise worked out earlier this week after several months of back and forth between legislators — paired an essential increase in the government’s borrowing cap with the promise of more than $2 trillion in budget cuts over the next decade.
President Barack Obama signed the bill into law Tuesday afternoon.
But MacManus said while legislators came up with a way to avoid default, the discussion will quickly shift to a new deficit reduction committee. Those talks, she said, could trigger the similar rhetoric from opposing sides.
“For the average Floridian, it is quickly going to become apparent that this is a protracted debate,” she said. “The frustration is going to intensify. There’s still a great deal of skepticism that the problem has been resolved.”
Administration officials said that if the country’s $14.3 trillion debt limit wasn’t increased, the U.S. would lose the ability to borrow and could default. It also would have meant the country would run out of money to pay its bills.
Defaulting on those payments would have a residual effect on the average American. Bob Matheson, owner of Naples-based Matheson Financial, said default meant interest rates on everything from mortgages to credit cards would have increased, and that increase would have occurred almost immediately.
But officials with some government agencies in Southwest Florida said the potential default didn’t necessarily mean their doors would be closed.
Bob DeGross, spokesman for the Big Cypress National Preserve, said the national parks were not facing immediate closure had the debt limit not been raise. Instead, DeGross said his understanding was there was a period of time the government would be able to operate before making decisions about what to close to save money.
Whether Floridians receiving Social Security would have received their checks is a little murkier. Paul Greene, a spokesman with the Social Security Administration in Sarasota, said officials didn’t know what would happen if legislation hadn’t been passed.
“We didn’t know what was going to happen. I don’t know if we had a contingency plan,” he said. “I think it was a wait and see, as far as we know. It wasn’t in the purview of Social Security at this time.”
The Rev. Michael Orsi, a professor at Ave Maria School of Law, said chances were slim the government wouldn’t have been able to pay out things like Social Security.
“Crucial checks were going to go out,” he said. “People were going to get their Social Security checks. The military was going to be taken care of. The people owed interest on bonds were going to get their payments.”
The debate over the debt limit may not be over, but Peter Bergerson, a political expert at Florida Gulf Coast University, said it has definitely increased Floridians awareness about how much the U.S. actually borrows.
“Most people have debt ... but individual debt is regulated by banks or credit card companies and they don’t allow it to reach the point to it being seemingly quite high,” he said. “In order to address this debt ... it is the cumulative amount of money over 200 years that the government has acquired by selling bonds,” Bergerson said. “It goes back as far as the American Revolution. It’s not something that is new.”
The Associated Press contributed to this report.