The debt ceiling debacle is a threat to America's national security.
If the debt ceiling isn't increased, national security focused departments and agencies – and all of their employees – may not receive the money they need to keep defending the nation. This historic and potentially catastrophic default on U.S. national security will undermine the U.S. military, all national security-related federal workers and national security contractors.
Absent a political breakthrough in this needless standoff over the debt limit, before the end of the month the Treasury will enter a cash flow crisis, where we won't have enough money to pay all of our bills.
Treasury has indicated that the "least harmful option" in this disastrous scenario would be a so-called "delayed payment regime." As the Treasury further noted, "no payments would be made until they could all be made on a day-by-day basis." This would mean all payments to the military, national security agencies and national security contractors will be delayed until the Treasury had enough cash on hand to pay an entire day's obligations, allowing the backlog of payments to grow in the interim.
American policymakers are all too aware of the consequences to our national security if the bills aren't paid on time. "If we don't increase the debt ceiling, the impact on our military will be unprecedented," Rep. Madeleine Bordallo, the ranking Democrat on the House Armed Service Subcommittee on Personnel, explained at a hearing on October 10.
And events are going to get even worse. The Treasury is expected to provide $12 billion in economy-stimulating military pay, retirement and veterans benefits on November 1. That day is unfortunately also when the federal government owes billions to other groups as well. As a recent report from Goldman Sachs noted, "the payments the Treasury must make are so large that the Treasury would already be nearly a week in arrears after the first day it has depleted its cash." In other words, the troops may have to wait nearly a week to be paid. And as chairman of the House defense appropriations subcommittee, Rep. Bill Young, R-Fla., once explained, "many [troops and their families] live paycheck to paycheck."
And it's not just America's uniformed personnel who will miss a paycheck or two or three – the entire national security establishment won't be paid on time. CIA analysts monitoring al-Qaida would temporarily go without pay, as would FBI special agents chasing serial killers and crime bosses, Homeland Security agents patrolling our borders, NSA cryptologists stopping the next cyber-attack, and every single other person who works for the federal government to defend this nation. An angry, distracted workforce concerned about how to pay the mortgage or daycare fees is not one that can focus on defending the nation.
Even at agencies not traditionally viewed as part of the national security establishment – like the Centers for Disease Control, where personnel was recently recalled to address a salmonella outbreak – won't know when their paychecks will arrive.
Payments to national security contractors will also be delayed, which will ultimately cost taxpayers even more money because the Prompt Payment rule "assesses late interest penalties against agencies that pay vendors after a payment due date."
Contractors also provide many services to our troops fighting in Afghanistan. We don't know what will happen if contracts for food, ammunition and equipment aren't paid on time.
As catastrophic as all of this could be, there's a very simple solution: increase the debt limit. With a very simple – and what was once routine – legislative act, Congress can solve this problem and avoid gravely harming America. There is no – repeat, no – policy goal that's worth truly jeopardizing America's national security. If some in Congress believe otherwise, their voters should keep that in mind come Election Day.
Mieke Eoyang is the director of Third Way's National Security Program. Benjamin Freeman is a policy advisor for national security at Third Way.
Clarified on 10/16/13: An earlier version of this blog post failed to make clear that the current debacle and not the debt ceiling itself is a national security threat.