As many U.S. House Republicans continue to argue that defaultingon our obligations won’t disrupt the lives of Americans and push our economy to the brink, it’s important to understand the reality. The Department of the Treasury estimates that if we default, it will no longer have enough cash on hand to pay all bills coming due, which include earned benefits to individuals, payments to vendors and contractors, and interest on Treasury bonds, as well as all other costs of operating the federal government. The Bipartisan Policy Center estimates that the Treasury would be about $134 billion short by the end of August.
Consider Social Security, which is scheduled to pay about $60 billion in earned benefits to about 55 million retirees, widows, disabled workers, and children in the month of August:
* 28 million Americans are scheduled to get their payment on Aug. 3.
* 9 million Americans are scheduled to get their payment on Aug. 10.
* 9 million Americans are scheduled to get their payment on Aug. 17.
* 9 million Americans are scheduled to get their payment on Aug. 24.
Social Security’s Trust Fund currently holds more than $2.6 trillion in U.S. Treasury bonds, generated by worker contributions, beneficiary tax payments, and the interest earnings on those contributions.
The average Social Security benefit is currently about $1,100 a month.
