White House warns of recession as debt limit fight drags on

White House economists are warning of “severe damage” to the U.S. economy in the event of a debt default. And in a new report, they detail potential job losses and stunted economic growth if lawmakers engage in “brinkmanship” before ultimately reaching a deal to meet the government’s financial obligations. The experts' analysis evaluates three potential scenarios as the Treasury Department says that without congressional action, it'll run out of tools as soon as June 1 to avoid a default. One scenario is a protracted default and the second is a short one. In the third scenario, lawmakers take the country’s full faith and credit to the wire, but avert default. The report says all three would hurt the economy.