Reply #11: Correct [View All]

[grantcart]

Your OP is based on the premise that the SS Trust cash flow is entirely seperate from the cash flow of the federal government.

While the trust fund is seperate from the budget and has nothing to do with the deficit it is still tied to the cash flow and the debt ceiling of the federal government.

In other words the President can't simply segregate expenditures for Social Security outside of the total indebtedness or debt ceiling, all revenues and expenditures have to be reconciled under the debt ceiling.

In the nightmare scenario of no debt ceiling increase the President would have to either unilaterally increase the debt ceilling or prioritize expenditures. Even though Social Security revenues may currently be higher than expenditures the total debt ceiling could not be breached. Therefore the President would be forced in the position to decide where revenue dollars, both tax and other revenues (including SS revenues) would be needed most urgently after the outstanding treasury bonds were paid. IF the President decided that national security etc. required a higher priority of available cash available and no surplus dollars were available then a credit would have to be given to the SS fund.

Besides the funds for the payments are the funds required for federal employees to be paid to process the payments.

Your poll would likely fulfill the point you thought you were making if the revenues of SS were kept seperate from federal funds and not comingled as they have these many decades, ala Al Gore's 'lock box'. However the subtraction of these revenues from the government cash flow would increase dollar for dollar the need to further increase the debt ceiling.

So without any deception the President was speaking completely truthfully. Social Security revenues not withstanding on August 2nd the combined revenues and combined obligations of the federal budget, medicare, and social security will have to be reconciled under a single debt ceiling.