All articles tagged with #government payments
Since his inauguration, Donald Trump has claimed over $100 million from the U.S. government for damages related to investigations into his presidency, and while he has not yet enforced these claims, he could potentially reach a settlement with the Justice Department, raising ethical questions due to the involvement of officials who previously represented him.
The US government now accepts Venmo payments to help reduce the over $36 trillion national debt, with donations also possible via bank, PayPal, or credit card, although individual contributions are unlikely to significantly impact the debt which grows by nearly $55,000 per second.
The US could run out of money to pay all its bills as early as next week if Congress fails to raise the debt ceiling. Treasury Secretary Janet Yellen has said that the US could run out of money to meet all its obligations as soon as June 1. One option for Yellen would be to pay bondholders the interest they are owed on US Treasuries first and delay paying all other bills, like Social Security and veterans benefits, until the government has enough money to do so.
Unless a deal is reached on the debt ceiling, government payments for programs such as Social Security, Medicare, and Medicaid, as well as military salaries and veterans benefits, could be at risk of going unpaid or being delayed. Treasury Secretary Janet Yellen maintains the nation could be unable to pay all of its bills in early June, possibly as early as June 1, though the exact date remains unclear. President Joe Biden and House Speaker Kevin McCarthy have been adamant the U.S. won't default, but still remained "far apart" on a solution on Wednesday.
If Congress and the White House fail to reach a deal to raise the debt ceiling, real people could suffer, from service members to Social Security recipients to would-be homebuyers. Among the government's bills coming due June 1 are $12 billion in veterans' benefits and $25 billion in Social Security benefits set to be paid on June 2. A prolonged default could send mortgage rates soaring above 8%, weakening the already fragile housing market.
President Biden is expected to meet with congressional leaders on Tuesday about the debt ceiling, with just about two weeks until the country could run out of money to pay its bills. Economists and administration officials have warned that a potential default on the national debt would amount to financial disaster, wreaking havoc on the domestic economy and rattling global markets, too. The economic effects would ripple outward from there, and people could see higher rates for things like mortgages and credit card interest. Retirement savings are about the long-term, and a temporary disruption is not likely to have a long-term effect on those savings.
The failure of US leaders to reach an agreement to raise the nation's borrowing limit could lead to catastrophic and devastating effects across the country, with Social Security payments being one of the biggest impacts. If the debt ceiling isn't raised by the projected default date in June, the July Social Security benefits would be in jeopardy. Republicans refuse to raise the debt ceiling without federal spending cuts in exchange, while Democrats say the nation's borrowing limit should be raised without conditions and federal spending negotiations should happen separately.
The US government has less than a month before it could start defaulting on its payments, and there is no sign of an imminent resolution. If the US were to default again, the primary effect would be interest rates going up significantly, affecting everything from credit cards to auto loans to mortgages. Businesses would have more trouble getting loans, and federal payments might come to a standstill as the Biden administration is forced to confront how to prioritize payments coming due with the funds it still has available.
Millions of Americans who rely on federal payments could be negatively impacted if the US government is unable to pay its bills come June 1. Economists agree that the first debt default in US history would be an economic catastrophe and could trigger a global financial crisis. Payments to 67 million Social Security beneficiaries could be halted, but a 1996 law provides an escape clause that allows the Treasury Department to continue paying Social Security benefits, even if there is a delay in raising the debt ceiling. The US credit rating would most likely be downgraded, sending interest rates higher and making it more expensive for businesses and consumers to borrow money.
The Federal Reserve's digital payments system, FedNow, will launch in July, allowing bill payments, money transfers, and other consumer activities to move more rapidly and at lower cost. Participants will complete a training and certification process in early April. Institutions that participate in the program will have seven-day, 24-hour access, as opposed to a system currently in place that closes on weekends. The program could even supplant the need for a central bank digital currency.