Sen. Rick Scott (R-Fla.) circulated a letter to Senate colleagues Thursday urging them to back his plan to ensure the federal government does not default on interest payments or payments to Social Security beneficiaries if Congress fails to raise the debt limit before the Treasury Department runs out of borrowing authority.
Scott’s bill, which is co-sponsored by Sen. Ron Johnson (R-Wis.), is called the Full Faith and Credit Act and would require the Treasury Department to continue to pay the principal and interest on debt held by the public and ensure Social Security payments continue to old-age and disability beneficiaries.
It would also prioritize payments to active members of the armed services and U.S. Coast Guard and compensation and pensions provided by the Veterans Affairs Department.
Finally, it would also instruct the Treasury Department to prioritize Medicare payments.
Their bill ensures that the Treasury Department will not run out of money to cover debt payments, Social Security payments and other stipulated obligations because it requires the Treasury secretary to notify Congress of any expected revenue shortfall and raise the debt limit by the amount necessary to cover those priorities on a two-week basis.
Scott called the bill a “commonsense solution” that “protects entitlement programs, ensures our military members are taken care of and takes a default threat off the table by mandating interest payments on our debt.”
The Florida senator said President Biden and Treasury Secretary Janet Yellen “possess the full authority to prioritize debt payments and ensure that the full faith and credit of the United States is never in question.”
“No one wants to default,” he wrote.
Johnson in a separate statement said the legislation “will guarantee that the government does not default on its debt and prioritizes spending for the men and women in our military as well as those who depend on Social Security, Medicare and veteran benefits.”
Senate Democrats have rejected past Republican calls to prioritize interest and Social Security payments in the event that Congress fails to pass legislation to raise the debt limit before the government runs out of borrowing authority.