Thursday, July 14, 2011
Could social security benefits really stop Aug. 3 in case of default?
Tonight, NBC Nightly News examined what would happen during a default, and hinted that payments of Social Security benefits might be sheltered somewhat by the mechanics of the Trust Fund. But, still, cash flow into the Trust Fund must occur.
One obvious “opportunity” would be to restore the full FICA tax rates (see original roll back story here ). It does not make sense not to collect the full taxes during a debt crisis.
But no one has suggested that immediate "means testing" to determine "need" among Social Security recipients right at the beginning of August is feasible.