The national debt ceiling debate escalated yesterday when President Obama, in a televised interview on CBS News, said that he can’t ensure that government benefits—including Social Security—will be paid if Congress fails to act on reducing the deficit.
“I cannot guarantee that those checks go out August 3rd if we haven’t resolved this issue. Because there may simply not be the money in the coffers to do it,” Obama told CBS News. “This is not just a matter of Social Security checks. These are veterans checks, these are folks on disability and their checks. There are about 70 million checks that go out.”
The Obama administration and many economists predict economic catastrophe if the U.S. fails to raise the amount it is legally allowed to borrow by August 2. Republican and Democratic lawmakers hope to use the threat of the deadline to create a broader package on long-term deficit reduction. Republicans aim to cut trillions of dollars in federal spending, while Democrats are pushing to pair spending cuts with increased taxes.