Mohamed A. El-Erian , Columnist

Debt Ceiling Fight Is a Damaging Distraction

Neither party would want to be associated with an embarrassing downgrade of the U.S. sovereign credit rating.

August 25, 2017 at 6:00 AM UTC

Mohamed A. El-Erian is a Bloomberg Opinion columnist. A former chief executive officer of Pimco, he is president of Queens’ College, Cambridge; chief economic adviser at Allianz SE; and chair of Gramercy Fund Management. He is author of “The Only Game in Town.”

Face-off.
Photographers: Nicholas Kamm, Saul Loeb/AFP/Getty Images

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The debt ceiling is attracting a lot more attention, especially after President Donald Trump labeled it a "mess" on Wednesday amid growing tensions within the Republican Party. We should expect the rhetoric to get even more heated in the days and weeks ahead.

It is unlikely, however, that this will lead to a technical default by the U.S. or a repeat of the 2013 government shutdown. Instead, the most likely outcome would involve a last-minute compromise that, while it would avoid immediate damage, is likely to add to the delays in implementing the economic measures that are critically needed to deliver higher and more inclusive economic growth.