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What Does The Debt Ceiling Debate Mean To Your Social Security Check

11:39 AM, Jul 16, 2011   |    comments
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WASHINGTON, DC (WUSA) --- As debt-ceiling talks ground to a halt at week's end, Social Security recipients still don't know whether they will be getting their checks next month if there is no agreement on whether to raise that debt ceiling.

When asked by Scott Pelley of CBS News, President Obama broadened the question to include beneficiaries of other federal programs and responded,"I can not guarantee that those checks go out on August Third if we haven't resolved this issue because there may simply not be the money in the coffers to do it."

Some House Republicans responded with a press conference the next day accusing him of using scare tactics.

"The money for senior citizens will be there. After we had that press conference, the actuary for the Social Security Trust Fund said that the funds will be there for checks to be un-interrupted for a minimum of three years, a minimum.

"So, the president shouldn't be trying to scare our senior citizens who count on that Social Security check.

" They already know what they can pay for and what they can't each month. This is no way to negotiate, by scaring people who should not be scared. They need to know the money will be there for them, sure," said Republican Congressman Louis Gohmert of Texas.

What is a Social Security recipient to believe?

Those Republicans are correct about the Social Security Trust Fund. It does have a lot of money.

"The problem is all these funds are wrapped up in bonds. Back in 1983 the Social Security Reform Commission basically made guidelines that led to a surplus.

"This surplus was used to buy bonds, and these are the bonds that Michele Bachman and her colleagues would tap into to pay social security checks. The problem becomes, if we use these bonds and pay checks for the next three years, in the long term, we wouldn't have any money left to make further payments . So, after those three years were up there would be no more Social Security," said Alan Barber of The Center for Economic and Policy Research.

So, it sounds like the Republicans are right and the money is, at least, there.

"Technically it is there but technically there is also a law that was enacted in 1996 that says the Social Security Trust Fund can not be run down.

"That means that, even if we were to change the law and modify it so that we could take this money out, there probably would be a lag in payments and in a best-case scenario recipients would have to wait indefinitely to get their checks," Barber told 9News Now.

9NEWS NOW & WUSA9.COM

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