If congressional Republicans refuse to pay America's bills on time, Social Security checks, and veterans benefits will be delayed.
That's a statement President Obama made at today's press conference. See here for transcript.
It's not true, as Nancy Altman and John S. Scarberry pointed out in July 2011. The Social Security Administration owns bonds that the U.S. Treasury has issued. To make up for a shortfall each month, the SSA could sell some of these bonds to the Treasury. But where would the Treasury get the money to pay for these bonds? By issuing bonds to the public. How could the Treasury do that if the debt ceiling is not raised? The debt ceiling includes the SSA bonds. So for every $1 billion the Treasury pays when the SSA redeems bonds, the Treasury could issue $1 billion in new bonds without affecting the official debt at all.
Now, we know that if the Treasury did this with, say, $1 billion, the actual net debt of the federal government--the debt it owes to entities other than other parts of the federal government--would rise by $1 billion. But the debt ceiling is not on this net debt which, last I checked, was approximately $11.6 trillion. The debt ceiling is on the gross debt, which includes the amount the Treasury owes other entities within the federal government.