(Courtesy of American Society of Pension Professionals and Actuaries)
(Courtesy of American Society of Pension Professionals and Actuaries)

As we get closer to the global economic abyss, the warnings grow ever louder. “Bankers warn on debt proposal,” reads a headline on the front page of the Wall Street Journal today. Yesterday, China’s vice finance minister, Zhu Guangyao, said, “The executive branch of the U.S. government has to take decisive and credible steps to avoid a default on its Treasury bonds.” Because China is the largest holder of U.S. treasuries, that admonition is equivalent to a preemptive phone call from a bill collector. And tomorrow, pension professionals will release a report bound to grab everyone’s attention.

According to the American Society of Pension Professionals and Actuaries, if the United States defaults, retirement savings accounts could be hit with “losses in excess of 20 percent.” That equates to about $2.4 trillion. “During the 2011 debt ceiling negotiations,” the ASPPA report notes, “private pension assets declined an additional 26 percent.” ASPPA’s chilling estimates come from using data from the Investment Company Institute on mutual funds flows and money market flows. And that data was used by ASPPA to determine the impact of the 2011 debt-ceiling debacle and the implications for the mess we’re in now.

Because the full faith and credit of the United States has never ever been in as much doubt as it is today, no one knows with certainty what will happen if (more like when at this point) the U.S. breaches the debt ceiling on Oct. 17, as Treasury Secretary Jack Lew predicts. That’s why debt-limit doomsday deniers are nuts to toy with our most valuable asset.

But the predictions are so dire — frozen capital markets, delayed payments and global financial meltdown — only crazy people (see previous sentence) would play with this kind of fire. And if they succeed, more than 60 million American workers with retirement accounts, 80 percent of whom earn less than $100,000 annually, stand to get burned.

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Jonathan Capehart is a member of the Post editorial board and writes about politics and social issues for the PostPartisan blog.