Real Clear Politics:
White House Budget Director Jacob Lew dodged CNN’s Candy Crowley’s question if the administration would prioritize Social Security payments if a default occurred. Transcript of the exchange below:
CNN’s Candy Crowley, HOST: “More immediately, you’d have to make some spending priorities — payment priority decisions: Social Security benefits, and federal worker pay, and defense contractors. What are your priorities should the debt ceiling not be raised on the 2nd, when you have the bills that immediately come due? Social Security checks, federal worker pay, defense contractors?”
Jacob Lew, WH Budget Director: “Our plan is for Congress to do its work and the President to sign into law legislation that will make it possible for the United States as it always has, to keep its obligations. We’ll be ready to deal with whatever happens. There is no plan other than meeting our obligations.”
CROWLEY: “Surely you must have discussed priorities, though, we have to pay this?”
LEW: “The truth is this is a different situation the United States has ever faced. We’ve never gone into a situation where we didn’t have enough money to pay our bills. We borrow 40 cents on a dollar right now. And if the time comes when we lose the ability to pay our bills, there will be a cash flow issue that is very real, and that’s why it’s critical that Congress take action before August 2nd.”
CROWLEY: “Would you allow it to happen that those the Social Security checks would not go out? Would you allow that to happen?”
LEW: “As the President has indicated, it’s not a question of what we allow and what we don’t allow –”
CROWLEY: “But you get to decide priorities. There will be some money –”
LEW: “There will not be enough money to pay all the bills.”
CROWLEY: “Of course not, that’s why I’m talking about priorities.”
LEW: “I think that once someone gets into the business of trying to ask about setting priorities it misses the question. Which is that it’s unacceptable for the United States to be in a place whether it’s Social Security recipients, or a soldier or somebody who is just owed money by the government can’t be paid because we have not done our job.”
We’ve all been in the situation where our bills exceeded our income. So what do you do if you have $2,500 in bills and $2,000 in income? You pay the most important $2,000 in bills. That’s called “prioritizing.”
We have the $200 billion coming into the federal government every month. It takes $35 billion — I’m sorry, billion dollars — we have $35 billion that we must use to service the debt, $50 billion that we must use to write those Social Security checks, $2.9 billion to pay for our military personnel, and then other essentials.
You prioritize. Our president essentially suggested the other day that he’s not able to prioritize. As the chief executive of our nation, he cannot prioritize, and that’s why he suggested that Social Security checks may not be written come August 2nd if that debt ceiling isn’t increased.
No. You pay for the essentials first and then the non-essentials have to get cut. They have to wait.
What should our priorities be?
Social Security. Medicare. Military pay. Servicing our existing debt.
White House dinner parties and concerts. Potemkin townhalls. Executive salaries.
That is not to say that most government spending isn’t a good idea. But you have to make do with what you have. This whole idea of raising the debt limit now and cutting spending later is like giving a credit card to a crackhead.