Social Security issues debt-ceiling warning

The federal government shutdown hasn’t affected Social Security benefits. But it’ll be a different story if the government doesn’t raise the debt ceiling, according to the Social Security Administration. The Wall Street Journal’s Damian Paletta reports today that the administration has begun warning consumers who call in to ask about the effects of the shutdown that if Congress and the White House don’t reach an agreement to increase the government’s borrowing limit, it can’t guarantee that benefits will be paid in full.

The government is expected to hit the current federal debt limit on Oct. 17. If the ceiling isn’t increased, the government will be limited to spending only the cash it has on hand and coming in the door, and the Treasury Department will have to decide who gets paid and who gets left in the lurch. (Interest payments on the existing federal debt would be likely to get top priority.) A Social Security spokesman tells Paletta that the agency began issuing its warning to retirees and other inquiring parties after consulting with Treasury officials. Read more >>