It's August 3. Where is your Social Security check?

It's beginning to look like the squabbling children in Washington may not reach an agreement on increasing the debt ceiling, and the media is starting to pay attention to the practical consequences of their lack of action.

This morning's USA Today carried an article titled "Debt limit delay would jeopardize Social Security payments." The article references a study from the Bipartisan Policy Center which says that without an increase in the debt ceiling "...in August, the government could not afford to meet 44% of its obligations."

In practical terms, they list two possible scenarios to deal with this situation:

1) "If Social Security, Medicare, Medicaid, unemployment benefits, payments to defense contractors and interest payments on Treasury bonds were [paid], that would be all the government could afford for the month. No money for troops or veterans. No tax refunds. No food stamps or welfare. No federal salaries or benefits.

2) "Want to protect the social safety net? That would be possible — but only if Treasury stopped paying defense contractors, jeopardizing national security. Plus virtually every federal agency and employee."

"The Bipartisan Policy Center studied Treasury Department receipts and spending for August 2009 and 2010 and found that the government likely would not have enough revenue to make the full $23 billion payment to Social Security recipients due Aug. 3. That's the first Wednesday of the month, when a majority of Social Security and Supplemental Security Income checks go out."

The article goes on to quote two Republicans concerning the seriousness of this issue.

1) "We should be honest with ourselves what this would be like, and the answer is it would be chaotic," said Jay Powell, a former top Treasury official in President George H.W. Bush's administration. "There is no way to avoid really serious pain."

2)"The effect on the country, said former Republican senator Pete Domenici of New Mexico, would be "irretrievable."


Click here to go to the USA Today article.