Full Faith and Credit Act This bill requires the Department of the Treasury to prioritize certain obligations if the federal debt limit is reached and provides for a limited increase in the debt limit to fund these priorities. If the federal government reaches the debt limit, the following obligations must be given equal priority over all other federal obligations: the principal and interest on the debt held by the public; Social Security benefits; pay and allowances for members of the Armed Forces on active duty and members of the U.S. Coast Guard; compensation, pensions, and payments for medical services provided by the Department of Veterans Affairs, and the Medicare programs. If the debt limit has been reached and incoming revenue will be insufficient to pay the priority obligations over an upcoming two-week period, the bill requires (1) Treasury to notify Congress of the expected revenue shortfall for the two-week period, and (2) the debt limit to be increased by the amount of the expected shortfall. If the incoming revenue exceeds the expected shortfall, the excess revenue must be held in reserve and applied to the following two-week period.
Impact
The passage of SB82 could significantly alter how the government manages its debts and funding priorities. By mandating that certain obligations take precedence, the bill aims to protect those who depend on government assistance and military support during times of financial constraint. This approach underlines a commitment to ensure that essential services and benefits remain intact, even when broader fiscal health is compromised.
Summary
SB82, known as the 'Full Faith and Credit Act', was introduced with the intent to ensure the prioritization of key federal obligations if the United States reaches its debt limit. The bill specifies that, in such situations, the Department of the Treasury must prioritize the payment of principal and interest on public debt, Social Security benefits, military pay for active duty and Coast Guard members, compensation and pensions for veterans, and Medicare programs. This mechanism is meant to safeguard vital financial commitments to citizens relying on these programs during fiscal emergencies.
Contention
However, the bill may face contention regarding its mechanisms for increasing the debt limit and its implications for federal fiscal policy. Critics could argue that such prioritization could lead to a perpetual cycle of raising the debt limit without addressing underlying spending issues. Furthermore, there may be political divisions over which obligations should hold priority and how incoming revenues should be managed, especially during an economic downturn when resources may already be stretched thin. Opponents might also raise concerns about the potential for reduced flexibility in fiscal policymaking, emphasizing the risks of binding future Congresses to such mandates.
Default Prevention Act This bill requires the Department of the Treasury to continue borrowing to pay the principal and interest on obligations held by the public or the Social Security trust funds if the federal debt limit is reached. The bill also (1) exempts any obligations issued under this bill from the debt limit if the obligations would otherwise cause the limit to be exceeded, and (2) prohibits the obligations from being used to compensate Members of Congress.
Debt Explanation Before Taxwriters Act or the DEBT Act This bill requires the Secretary of the Treasury to appear before the House Ways and Means Committee and the Senate Finance Committee before the federal debt limit is reached or extraordinary measures are taken to prevent the United States from defaulting on its obligations. The term extraordinary measures generally refers to a series of actions that the Department of the Treasury may implement to allow the United States to borrow additional funds without exceeding the debt limit. The measures generally include suspensions or delays of debt sales and suspensions or redemptions of investments in certain government funds. The bill requires the Secretary of the Treasury to appear before the committees to provide a detailed explanation of (1) the extraordinary measures that Treasury will take and the administrative costs of taking the measures, and (2) any reversal of such measures and any other changes in the funding of federal government obligations.
This joint resolution proposes a constitutional amendment that prohibits total outlays for any fiscal year from exceeding total receipts for that fiscal year.The amendment also prohibits (1) increases to the federal debt limit, and (2) a bill that increases revenue from becoming law unless the bill has been approved by two-thirds of each chamber of Congress with a roll call vote.
A bill to amend the Internal Revenue Code of 1986 to increase the threshold amounts for inclusion of Social Security benefits in income, and for other purposes.
Assuring Medicare’s Promise Act of 2023 This bill increases net investment income tax revenues by applying such tax to the trade or business income of certain high income taxpayers and includes the increased tax revenues in the Federal Hospital Insurance Trust Fund.
Language Access for Medicare Beneficiaries Act of 2023 This bill requires the Centers for Medicare & Medicaid Services (CMS) to translate the annual explanation of Medicare benefits for enrollees into multiple languages, besides English and Spanish. The CMS must prioritize languages into which Social Security documents are translated or that are most frequently requested for purposes of Social Security benefits applications.
No Hires for the Delinquent IRS Act This bill prohibits the hiring of additional Internal Revenue Service (IRS) employees until the Department of the Treasury publicly issues a written certification that the IRS does not employ any individual who has a seriously delinquent tax debt (i.e., an outstanding tax debt for which a notice of lien has been filed in public records).