To the peanut gallery that don't "get it": There is zero risk of Social Security and Medicare checks not going out if the debt ceiling is not raised for the next three years.
Got it? Zero.
How? Here's how:
That total debt number is the amount subject to the limit, more or less.
But the "Intragovernmental Holdings" is the amount that the Social Security and Medicare trust funds are "owed" by the general fund.
The Treasury can redeem those by selling new bonds into the market in a 1:1 ratio and if they do so they now have dollars in an exactly equal amount.
That's $4.6 trillion dollars.
How much is Social Security and Medicare every year? That's easy - we can look at the Trustee report, which says that in 2010 the total expenditures were $1.235 trillion.
Note that these funds also receive tax monies and in 2010 they took in $1.267 trillion.
Wait a second...... they took in more than they spent? Indeed, which means that the only reason the Treasury has a problem in the present tense is that they have been stealing the tax revenues and replacing them with yet more IOUs.
(Note that due to the boomers retiring and medicare cost advances, which are relentless, both of these funds are bankrupt in the intermediate term. We're talking about whether the money exists to pay benefits here and now, not in the future.)
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