Supplemental Nutrition Assistance Program (SNAP) Number of participants by government program This is an underrepresentation, of course, as the Federal government is responsible for funding many programs on which Americans rely-from childcare, to cash assistance, to aid for small business owners. Before the full weight of the Federal pandemic response had come to bear, the hardships experienced early on-exemplified by families going hungry and waiting in food lines-remind us of the raw misery that inadequate Federal support brings in the wake of an economic shock.Įxamples of other important forms of Federal assistance that would also be at risk are outlined in the table below. If the Federal government ended up missing or delaying payments, millions would be unable to put food on the table or pay rent. For a single veteran with a 50 percent disability rating and no dependents, the average disability benefit is around $900 per month veterans with families or with greater disability ratings receive more. Although affordable health care is vital, particularly during a pandemic, millions could find themselves without coverage.Ī default threatens veterans’ programs as well, with over 9 million veterans relying on physical and mental care, in addition to other supports. Net Medicare payments, alone, amount to about $1,100 per recipient. Over 60 million people across America are on Medicare, 75 million are enrolled in Medicaid, and almost 7 million children receive coverage through the Children’s Health Insurance Program (CHIP). ![]() Health coverage during a pandemic would also be in doubt. And yet, if we default, these Americans may not receive their Social Security payments on time, or even at all. Among households receiving any Social Security benefits, those benefits make up more than half of household income on average. As shown in Figure 1, the average retired Social Security recipient counts on receiving almost $1,600 per month. In 2015, around 12 million people relied on Social Security as their sole means of support. In 2020, almost 50 million residents received retirement benefits through Social Security, and 6 million received survivors benefits. If the United States were to default, tens of millions-including families with children, retirees, and veterans-would quickly, even overnight in some cases, face the prospect of losing the regular Federal payments that help them to make ends meet. The Federal government would be immediately impaired from carrying out its basic functions, including providing the financial assistance that tens of millions of Americans rely on.Įveryone in America would feel the effects of a default. In this post, we go further, and lay out the risks that Americans and the U.S.-and global-economy will face in the days, months, and years after a default. In an accompanying blog post, we explain what the debt limit is. These and other consequences could trigger a recession and a credit market freeze that could hurt the ability of American companies to operate. credit rating would almost certainly be downgraded, and interest rates would broadly rise for many consumer loans, making products like auto loans and mortgages more expensive for families who are subject to interest rate changes or taking out new loans. Financial markets would lose faith in the United States, the dollar would weaken, and stocks would fall. The public health system, which has enabled this country to react to a global pandemic, would be unable to adequately function.įurthermore, a default would have serious and protracted financial and economic effects. The basic functions of the Federal government-including maintaining national defense, national parks, and countless others-would be at risk. Payments from the Federal government that families rely on to make ends meet would be endangered. If Congress fails to act, it could take decades for the United States to fully recover.Ī default would fundamentally hinder the Federal government from serving the American people. Treasury Department estimates that it will have very limited resources to avoid doing exactly that for the first time unless Congress raises or suspends the debt ceiling by October 18th. This country has never intentionally defaulted on its obligations because of the debt limit. The credit of the United States is built on centuries of stability and responsibility. Get Involved Show submenu for “Get Involved””īy Chair Cecilia Rouse, Ernie Tedeschi, Martha Gimbel, and Bradley Clark.The White House Show submenu for “The White House””.Office of the United States Trade Representative.Office of Science and Technology Policy.Executive Offices Show submenu for “Executive Offices””.Administration Show submenu for “Administration””.
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