WASHINGTON (AP) — Horror stories are flying about the damage that might be wreaked should Congress and President Barack Obama fail to cut a deal by the Aug. 2 deadline to increase America's borrowing limit. Nearly every American is in harm's way, either directly or indirectly.
Absent a deal by then, the government would find itself tight on cash and unable to borrow — and have to start deciding which of the 80 million bills due in August it should pay and which it should put off.
Tough decisions would come immediately: On Aug. 3, some $23 billion in Social Security benefit payments are due to be processed. On Aug. 4, the Treasury Department must pay $87 billion to investors to redeem maturing Treasury securities. On Aug. 15, more than $30 billion in interest payments come due.
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