Failing to raise the debt ceiling and allowing the U.S. to default on its debt would have potentially catastrophic consequences for the economy and for Americans, CEOs of the nation’s largest banks told President Biden yesterday at a White House event. “America simply cannot default on the debt because the U.S. Treasury market is the bedrock of our financial system, domestically and globally,” said Citi CEO Jane Fraser. “Defaulting is going to cause lasting damage to the credibility of the U.S. with investors and markets around the world.”

Beyond that, Fraser added that a default “will hurt consumers, it will hurt small businesses. It’s not an exaggeration to say that even small distortions in the Treasury market can cost taxpayers tens of billions of dollars over many years.” JPMorgan Chase Chairman and CEO Jamie Dimon added that “an actual default would be unprecedented,” and that the “effects would be cascading,” and could range anywhere from “recession to a complete catastrophe for the global economy.” Dimon advocated for the removal of the debt ceiling, noting that “we don’t need to have this every couple of years.” Bank of America Chairman and CEO Brian Moynihan also participated in the meeting.

Last month, ABA joined other financial trade association in urging lawmakers to take prompt action to raise the federal debt limit to ensure the continued confidence in the creditworthiness of the U.S. and the functioning of Treasury markets. Watch the event. Read the joint letter on the debt ceiling.