Al Mayadeen English

  • Ar
  • Es
  • x
Al Mayadeen English

Slogan

  • News
    • Politics
    • Economy
    • Sports
    • Arts&Culture
    • Health
    • Miscellaneous
    • Technology
    • Environment
  • Articles
    • Opinion
    • Analysis
    • Blog
    • Features
  • Videos
    • NewsFeed
    • Video Features
    • Explainers
    • TV
    • Digital Series
  • Infographs
  • In Pictures
  • • LIVE
News
  • Politics
  • Economy
  • Sports
  • Arts&Culture
  • Health
  • Miscellaneous
  • Technology
  • Environment
Articles
  • Opinion
  • Analysis
  • Blog
  • Features
Videos
  • NewsFeed
  • Video Features
  • Explainers
  • TV
  • Digital Series
Infographs
In Pictures
  • Africa
  • Asia
  • Asia-Pacific
  • Europe
  • Latin America
  • MENA
  • Palestine
  • US & Canada
BREAKING
Trump: We want to feed the people in Gaza, we do not want them to starve.
US President Donald Trump: We will impose sanctions on Russia if it does not end the war on Ukraine.
Israeli media: Polls show that 52% oppose Prime Minister Benjamin Netanyahu while only 29% support him.
Israeli media: 32% of Americans still support "Israel's" war on Hamas, while 60% oppose it.
Israeli media: Core US support for "Israel" hits its lowest, while support for Palestine reaches its highest levels.
Al Mayadeen's correspondent reports martyrs, injuries in Israeli bombardment of home in Heker al-Jame area in Deir al-Balah, central Gaza.
Al-Quds Governorate: Today, the spatial division of Al-Aqsa Mosque began in a public and dangerous manner, and we warn of a religious war in the region
The Ministry of Health in Gaza: This brings the total number of victims of famine and malnutrition to 175, including 93 children
The Ministry of Health in Gaza: Gaza's hospitals recorded six deaths due to starvation and malnutrition in the past 24 hours, all of them adults
Informed sources to Al Mayadeen: A new chapter in relations between Iran and the International Atomic Energy Agency will begin within the framework of the new law passed by Parliament

US debt default puts social security, healthcare, veterans at risk

  • By Al Mayadeen English
  • Source: Agencies
  • 24 May 2023 20:50
  • 2 Shares
4 Min Read

The political war between Republicans and Democrats continues as federal institutions scramble to plan for scheduled payments.

  • x
  • US default storm inches away, what are the scenarios?
    Storm clouds pass over the US Capitol dome in Washington, US, June 17, 2019 (Reuters)

The United States is rapidly closing in on total financial chaos, as the two ruling parties have failed so far to reach a borrowing ceiling consensus although the debt default is estimated to hit the government in early June, as per earlier statements by US Treasury Secretary Janet Yellen.

The debate over raising the debt ceiling has become an annual occurrence, however, this year Congress is in a race against time while Republicans and Democrats are yet to agree on the terms.

In short, the United State's expenses exceed its revenues, which prompts an increase in the borrowing limit currently sitting at $31.4 trillion.

Read more: Asian markets sink as US debt ceiling talks stall

US markets are accumulating losses every day as the debt default date, also known as X-date, closes in. But the default impact would not be limited to the United States, rather, it would have a tremendous impact on the global markets. 

Moreover, in case this scenario happens, investors would lose trust in the US financial system, and thus won't be as motivated to invest in products and instruments backed by the US dollar.

Spending on federal programs, such as social securities, medical assistance, and benefits programs for serving and retired army personnel, among other payments, that accounted for 45 percent of last year's 6.27 trillion budget, would be forced to a halt - affecting tens of millions of Americans.

"We would simply not have enough cash to meet all of our obligations," Yellen said earlier this month.

On Monday, US House Speaker and President Joe Biden said their first one-on-one talks in months to avoid a calamitous debt default were "productive", but disagreements were still blocking any possible deal.

Related News

Iraq’s PMF law seen as test of sovereignty amid US objections

Notorious Palantir lands record $10bln contract with the US Army

The White House meeting came after Biden cut off a  short trip to Asia to recommence talks in advance of the US Treasury's deadline for Congress to authorize more borrowing.

Read more: Yellen warns brinkmanship over debt limit risks serious economic costs

Get ready

The US Treasury informed federal bodies to secure a feasible plan for differing scheduled payments to prepare for a budget payment pause, reports said earlier.

Medicare providers are scheduled to receive $47 billion on June 1 from the Treasury, $25 billion dollars for social security programs are planned for June 2, and other payments are supposed to be made in the following days of the month,

Also on June 1, Congress said almost $25 billion in payments must be made to military personnel and civil servants, including other groups.

Selling and delaying

While missing pay dates will affect the US government, delaying some expenses for a few days is still manageable, but which bills to pay or sideline would be the main challenge for the federal government.

Selling government assets to make the due payments is also a plausible, yet less probable, scenario.

US Treasury data show that the Social Security Administration carries over $2.8 trillion in assets as of the end of April - making it the largest US bond holder in the world.

But this scheme would put US President Joe Biden in a political storm, especially from the Republican party, which would accuse him of failing to manage the spending issue.

While the last emergency option would be that US President Joe Biden would use his executive powers granted by the 14th Amendment to bypass Congress on the matter, the White House said earlier this week that Washington is not planning on doing so.

  • United States
  • Congress
  • US debt
  • US Treasury Department
  • Washington
  • US
  • US debt default
  • Janet Yellen
  • Joe Biden
  • white house

Most Read

A rescued crew member from the ETERNITY C vessel in a video released by the Yemeni Armed Forces on July 28, 2025 (Yemeni Military Media)

Yemen Navy reveals fate of targeted Eternity C ship crew

  • Politics
  • 28 Jul 2025
An Israeli tank explodes following an ambush by al-Qassam Brigades in Gaza, Occupied Palestine, undated (Al-Qassam Military Media)

Al-Qassam strikes Israeli vehicles in Gaza, inflicts casualties

  • Politics
  • 30 Jul 2025
UAE lodges complaint against Israeli ambassador over 'misbehavior'

UAE lodges complaint against Israeli ambassador over 'misbehavior'

  • Politics
  • 1 Aug 2025
An explosion seen during an Iranian missile attack on Tel Aviv, Occupied Palestine, June 13, 2025 (AP)

If Iran is attacked again, geography of response may change: IRGC spox

  • Politics
  • 30 Jul 2025

Coverage

All
The Ummah's Martyrs

Read Next

All
A member of the al-Qassam Brigades, the armed wing of Hamas, takes part in a parade as he celebrates a ceasefire agreement between Hamas and the Israeli regime in Deir al-Balah, Gaza Strip, Sunday, January 19, 2025 (AP)
Politics

Al-Qassam: We’ll allow aid to Israeli captives if Gaza siege ends

Freed Lebanese freedom fighter Georges Abdallah during an interview on Al Mayadeen, which aired on Sunday, August 3, 2025 (Al Mayadeen screengrab)
Politics

Exclusive: Resistance key to building state, Georges Abdallah says

United Nations Secretary General Antonio Guterres gives a statement about the situation in Gaza at UN headquarters, Friday, June 27, 2025 (AP)
Politics

UN warns Gaza faces water crisis, looming famine under Israeli siege

Israeli soldiers drive their armored personnel carrier along the Gaza Strip, in southern occupied Palestine, Wednesday, July 30, 2025 (AP)
Politics

Ex-Israeli general says Gaza starvation campaign isolated 'Israel'

Al Mayadeen English

Al Mayadeen is an Arab Independent Media Satellite Channel.

All Rights Reserved

  • x
  • Privacy Policy
  • About Us
  • Contact Us
  • Authors
Android
iOS