The government is warning Social Security recipients not to count on timely or full checks in the event of a debt ceiling breach next week.
The Social Security Administration is directing its workers to tell concerned beneficiaries who call the agency that “failure to raise the debt ceiling puts Social Security benefits at risk,” according to the Wall Street Journal. On October 17, the Treasury Department will exhaust the “extraordinary measures” that it’s used to avoid a default since May and be forced to cease some legally required payments unless Congress agrees to increase the government’s borrowing limit, allowing the country to continue to pay bills already incurred by previous acts of Congress. That means choosing between retirees and things like the servicing costs of federal borrowing.
Prior to the Tea Party wave that made Rep. John Boehner (R-OH) the Speaker of the House, Congress had raised the debt ceiling with minimal fuss for 50 years. But Republicans decided the debt limit was “a hostage that’s worth ransoming,” succeeding in extracting spending cuts from Democrats during a 2011 debt ceiling fight that damaged the nation’s credit rating, cost taxpayers $19 billion, and cost the economy about a million jobs. Now they are rolling the debt ceiling fight together with the ongoing government shutdown fight, leading banks to enact emergency plans that include stuffing their ATMs with extra cash in case depositors panic and set off a run on the banks.
Boehner is refusing to back down from the party’s demands in exchange for a debt ceiling hike, despite having acknowledged that cracking the debt limit would mean economic catastrophe. Many in his own caucus, as well as several Republicans in the Senate, seem to believe that dire warnings about a new recession resulting from the debt ceiling are a hoax. The rise of such “debt ceiling truthers” leaves Boehner to choose between relying on Democratic votes to raise the debt ceiling or pushing the country and the world into an economic disaster.