I believe that the US government has an obligation under current law to make payments to Medicare and SS recipients. It's not a voluntary donation. I don't think the government can simply stop making those payments tomorrow without violating current law.
You see, it is this entire attitude of political parties negotiating in the 11th hour about whether or not to honor this or that obligation that isn't exactly encouraging. This is just not a responsible way to deal with political differences over government spending.
I also doubt the quality of the solutions coming out of that kind of process.
How can that be? Suppose our debt limit were hit. Law says we can't issue more debt; another law says we must pay social security. Until more taxes start rolling in, we'd be breaking one law or the other.
That's a very good question. In my view, it's simply incompetent, populist, law making. How can it be that a country can even have such a rule on the statute books without getting downgraded on the spot?
No, SS can be paid without affecting the debt ceiling.
"By law the Treasury is bound to redeem any bonds presented to it by the Social Security Administration. And when the Treasury does, total government debt subject to the debt limit falls by the amount of the redemption—thus freeing up the Treasury's ability to issue new bonds equal in amount to the redeemed Trust Fund bonds."
What makes you think I do not realize that? It's exactly why I took (small) pains to say "current law" and not just "law".
Under the rule of law, the government has to honor its own laws even though they can change them. They cannot make a law that incurs costs, take on debt, and then stop paying down their debt just because they could potentially change the law that caused those bills to run up in the first place.
You see, it is this entire attitude of political parties negotiating in the 11th hour about whether or not to honor this or that obligation that isn't exactly encouraging. This is just not a responsible way to deal with political differences over government spending.
I also doubt the quality of the solutions coming out of that kind of process.