Tuesday, July 26, 2011

Default Not a Given without Debt Deal (Unless Obama Chooses)

 President Obama and the Democrats have gone to great lengths in the past few weeks to convince Americans that failure to increase the debt limit would be akin to the United States defaulting, or otherwise we would be unable to pay Social Security and Medicare/Medicaid. Unfortunately, by the numbers, this is a false statement.

The Bipartisan Policy Center has run the numbers (1) on the expected incoming revenues in August against our budgeted spending and it turns out no, we could indeed pay for those items using only the incoming revenues from taxes.

According to the BPC, we are expecting $172.4 Billion in tax receipts in August. With that money, there is sufficient money available to:

- Service Our Debts (That's pay them off as scheduled, for those of you from Palm Beach County, FL).
- Pay Social Security Benefits
- Fully Fund Medicare and Medicaid
- Fully Fund the Department of Homeland Security
- Fully Fund the Labor Department
- Fully Fund the Justice Department
- Fully Fund the General Services Administration
- Pay All Federal Employee Salaries and Benefits
- Maintain Temporary Assistance for Needy Families
- Pay Outstanding IRS Refunds
- Fully Fund Veterans Affairs
- Pay Active Duty Military
- Pay Uninsurance Benefits

Thanks to Bloomberg Government for it's calculator. (2)

Here's the point: We only need to default or for that matter fail to pay social security, or medicare, or medicaid, or soldiers, if President Obama chooses to spend the money we have on something else. In short, it is in the President's hand, and if you don't receive your social security check or if the military isn't paid, etc, it is because Barrack Obama didn't consider you a priority.


(1) Bipartisan Policy Center: Debt Limit Analysis

(2) Bloomberg Government - Bloomberg Government (budget calculator)

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