11 days until your SS checks might be interrupted

Hey, I don't want YOU to get your military retirement check cut, because I don't want the government to default. Now, which checks to which people do YOU want to cut? Because MANY PEOPLE will not receive checks if the government defaults. I am just wondering why the SS checks and YOUR military retirement checks are more important than other people's checks.

I, for example, have a couple of grad students in my lab paid by a NSF grant to my lab. Should THEY be cut?

The problem is that the Righties always think that it is some faceless government entity that will be cut, when in reality these are REAL people, who rely on their paychecks as much as YOU and SS recipients to make ends meet. Food for thought....

 

Taxpayers are real people, too!

 

If you were really worried about a default you would be urging Biden to cave and just agree to sign the bill that the House passed. IF that is, you think default would be more damaging than simply some minor cuts to increases in the budget.

 

In June, excluding FICA and revenue from taxable benefits, Yellen will need an extra $20 billion to pay all OASI and SSI beneficiaries.

You knew that, right?

 

Oh I didn't, but I'm perfectly happy to examine your sources and see.

 

Nope. Mandatory is a real thing, comprising, as I said above, almost 70% if revenue. Debt service is one component.

 

In addition, Treasury will have pay its semi-annual interest to the trust funds. Last year’s OASI interest payments totaled $62 billion, thus, last June, approx. $31 billion, and due to a shortfall, interests were paid as benefits.

You knew that, right?

 

So you aren't going to share your source that Yellen needs an extra $20 billion to pay all OASI and SSI beneficiaries?

I'm so shocked and surprised.

 

Net Interest is a MUST PAY, or default

Next, Mandatory spending

Next, Discretionary

Next, the non-emergency and emergency supplementals

 

Just sit back and think, and you’ll figure it out.

 

Oh I already knew you were never going to provide any sources. I didn't need to think on that!

 

Social Security is part of what we owe. This is about the President deciding who to pay.

 

Tell that to them.

https://www.cbpp.org/research/socia...ntirely in U.S.,credit of the U.S. government.

 

Do you have something specific to advance about SS as an investment?

 

Biden WILL make concessions, just like Obama did 10 years ago, mark my words. Will the bomb throwers in the freedom caucus make concessions? I am not so sure.

 

Well I hope so. In my opinion, this debt ceiling fight isn't worth fighting when the end result if Biden caves is that when he runs for re-election he'll be able to brag that he cut the deficit in spite of those "Maga Republicans."

 

We absolutely can service the debt at the moment.

It's the everything else that we want to spend money on that we can't service along with the debt.

 

Actually, the source you’re looking for is my brain, thus, let’s begin;

Historically, when we had FICA surpluses, the surpluses bought non-marketable special issues.

Historically, the semi-annual interest payments, paid by the Treasury General Account, bought non-marketable special issues.

Today, the semi-annual interest payments are paid as benefits, because the OASI trust fund has a negative cash flow.

Once again, the semi-annual interest payments come from the Treasury General Account/“Checking Account”

For anyone info, SS/Medicare contributions, Withholding taxes, other tax receipts, AND THE CASH FROM THE SALES OF MARKETABLE SECURITIES are deposited in the Treasury General Account.

Question; Who’s money will be used for June’s semi-annual interest?

Cash from the sales of marketable securities?

Note; Prior to the debt ceiling limit, NO PROBLEMO……Treasury just borrowed from the Public, i.e. replace bonds held by the trust funds with bonds held by the Public.

 

Is servicing the debt also include redemptions?

What if X number of Public Investors decide to cash in their 30 day T-Bills amounting to $1 trillion, and hold on to their cash?

 

In addition to the above, IN NORMAL TIMES, Public investors have mainly rolled over their T-Bills/Notes/Bonds.

DIRE CONSEQUENCES if they don’t?

 

Historians will say that the root cause of the forthcoming crisis was infantilism.

 

I question that percentage and it's 80% of a low income tax anyhow. Look abroad.

 

I don't know what "everything else" is. Government has made promises to people and those we short would be rightfully alienated from the rest of us. We will have inflicted pain on them because we're running a horse ass operation called government. Maybe vacations will be harmed by TSOs being cutback, SS payments delayed or reduced, national parks shut down... who knows the impact?

We will be illiquid, not insolvent. We won't stiff bondholders because that might create a financial crisis, but even so we'll see an increase in interest rates that will slow the economy.

Of course, Biden could say he thinks the debt ceiling is unconstitutional and force SCOTUS to deal with the matter.

 

I don't suppose the drama is over yet.

We've now had years of different outcomes to debt ceiling crises and nothing seems to discourage playing games.

 

At the very least, interest rates would jump risk reflecting a risk premium on government paper.