US Never Defaulted on its Debt? Not So Fast
Posted at: 10/14/2013 10:07 AM
WASHINGTON (AP) - It's a claim you hear every time Washington wrestles with the debt limit: The United States has never defaulted. But historians say America has stiffed creditors on at least two occasions.
The young nation had a good excuse for late payments in 1814. The Treasury was empty, the White House had been burned by the British and even troops fighting the War of 1812 weren't getting paid.
In 1979, a technical glitch at the Treasury Department held up payments to some investors.
President Barack Obama has been warning that failure to raise the debt limit could lead to a first-time U.S. default.
Historian Don Hickey says that's because the president doesn't know his history. But then, not many people do. Hickey calls the War of 1812 "a forgotten conflict."
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