Sunday, July 23, 2017

Raise the debt ceiling by October or else

Alan Rappeport of the New York Times reports that Congress has until mid-October to raise the debt ceiling or risk quick defaults on federal obligations, in a story June 29, link here

The issue was briefly mentioned Sunday morning by Fareed Zakaria, who noted that, in the scramble over health care, Congress still has not gotten around to this issue.

President Donald Trump has sounded alarmingly reckless on this issue in the past, believing the US can renegotiate its debt. But Treasury Secretary Mnuchin has said that raising the ceiling and paying bills on time is essential.  Among ideological Republicans, there is a shocking disregard that this has to do with bills already ratcheted up.

I’ve discussed here before whether this impacts Social Security recipients, and the answer is mixed because legally the Social Trust fund shelters recipients somewhat.  But it would not be unconstitutional for Congress to stop benefits, even for existing retirees, even suddenly (Flemming v Nestor, 1960). 

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