The Briefing Room
General Category => Economy/Business => Topic started by: mystery-ak on May 24, 2023, 01:36:35 pm
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Published May 24, 2023 6:00am EDT
Who would be hit the hardest by a US debt default?
Social Security benefits, veteran payments on the line in debt-ceiling debacle
By Megan Henney FOXBusiness
The U.S. government could default on its debt within a matter of days, jeopardizing payments to millions of Americans and businesses.
The clock is running out for lawmakers to lift the debt limit. Treasury Secretary Janet Yellen reiterated a warning Monday that it is "highly likely" the country will run out of cash to pay its debts in early June, potentially as soon as June 1.
"We have already seen Treasury’s borrowing costs increase substantially for securities maturing in early June," Yellen warned in a letter to congressional leaders. "If Congress fails to increase the debt limit, it would cause severe hardship to American families, harm our global leadership position, and raise questions about our ability to defend our national security interests."
The debt ceiling, which is currently around $31.4 trillion, is the legal limit on the total amount of debt that the federal government can borrow on behalf of the public, including Social Security and Medicare benefits, military salaries and tax refunds.
"A technical default would also have severe consequences for millions of people. Social Security recipients, veterans, U.S. military employees, government employees, defense contractors, among others would likely go unpaid," said John Lynch, chief investment officer for Comerica Wealth Management. "The downstream effects of job losses and freezing of the credit markets would be a multiple-quarter negative hit to GDP, making a deeper recession all but certain."
Here is a closer look at the ordinary Americans who would be hit the hardest by a first-ever debt default.
Retirees
Social Security could be among the first government programs to face spending cuts in the event of a default, according to a new analysis published Tuesday by the Bipartisan Policy Center (BPC).
The government is slated to pay $100 billion in Social Security benefits throughout June, with four $25 billion payments slated for June 2, June 14, June 21 and June 28.
"Realistically, on a day-to-day basis, fulfilling all payments for important and popular programs (e.g., Social Security, Medicare, Medicaid, defense, military active duty pay) would quickly become impossible," the BPC report said.
Veterans
A default could halt or delay pay for current and retired service members and also threaten payments allocated to critical programs for mental health, caregivers and unhoused veterans.
The government is scheduled to pay $12 billion in veteran benefits and $10 billion in military pay and retirement funds on June 1, according to the BPC findings.
"Because there is no precedent for a default, it is difficult to know the precise impacts on specific federal programs," Terrence Hayes, spokesperson for the Department of Veterans Affairs, told FOX Business. "But what is clear is that, without the ability for the federal government to borrow funds, there is a very real potential that any government program or payment would be halted or severely delayed."
more
https://www.foxbusiness.com/economy/who-would-be-hit-hardest-us-debt-default
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Biden's administration will do their level best to play games with payments, making sure they do as much damage as possible.
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But of course Brandon and his minions would go after social security and Veterans, God forbid they cut anything going to illegals.
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It's whatever Yellen wants.
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It's whatever Yellen wants.
Whatever Yellen wants? I watched her testimony during the hearings and I'm not sure she knows what day of the week it is anymore, she really couldn't answer Kennedy's questions and constantly looked befuddled.
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Biden's administration will do their level best to play games with payments, making sure they do as much damage as possible.
@Kamaji
While stealing as much as possible and hiding it in offshore banks,where it will THEN be invested in foreign corporations that still pay dividends.
Assuming of course there will be any. If not,it will be invested in Gold,as well as in farms and oil fields.
Yeah,oil fields are now worse than nuclear radiation to the left,but that will change the instant they are in charge. After all,you can't farm,deliver farm goods,heat your homes,or create electricity without using oil/petroleum products. Once the globalist leadership owns all or most of it,oil will suddenly no longer be evil,and oil rigs will be pumping all the oil that bankrupt governments can pay for,and ultimately,they will pay by becoming vassal police states.
"We iz da wurld.........."
Sang hit wid me chilrins!
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"Because there is no precedent for a default, it is difficult to know the precise impacts on specific federal programs," Terrence Hayes, spokesperson for the Department of Veterans Affairs, told FOX Business. "But what is clear is that, without the ability for the federal government to borrow funds, there is a very real potential that any government program or payment would be halted or severely delayed."
That isn't defaulting. That is preventing a default. Pay the people you owe first. Then decide what to do with whatever is left over.
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That isn't defaulting. That is preventing a default. Pay the people you owe first. Then decide what to do with whatever is left over.
Yep the term "default" commonly refers to not paying back a bond/loan...“default, default, default” is all I hear...there will be no “default”, annual receipts for the Feds are around $5 trillion ($1.75 trillion "discretionary" left after “mandatory spending”) and the annual interest on the debt is about $929 billion. Bond holders (treasury notes/bills) likely would get paid first. As far as other government spending, cuts would be in order.
Simple fix...pass a balanced budget (including debt interest payments) and there is no need to increase the debt "limit".
https://fred.stlouisfed.org/series/FGRECPT
https://fred.stlouisfed.org/series/NA000308Q
https://www.cbsnews.com/news/debt-ceiling-debacle-who-gets-paid-first/
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(https://img.theepochtimes.com/assets/uploads/2020/02/13/zelensky-2-1200x800.jpg)
This guy ain't worried.