Troops could soon learn what debt debate means for their paychecks
By LEO SHANE III | STARS AND STRIPES Published: July 28, 2011
WASHINGTON — Treasury Department officials will outline whether troops will see their paychecks halted by the debt limit showdown in the next few days, according to the White House.
In comments to reporters, White House spokesman Jay Carney said negotiators are still hopeful that a deal can be reached, but Treasury planners are putting together a list of spending priorities to deal with the possibility of an “impossible” budget situation.
That will include whether military paychecks will be halted, veterans benefits stopped or civilian defense employees furloughed, because funds could not be borrowed to cover those obligations. Administration officials have said they expect a shortfall of about $134 billion for August alone, unless new borrowing authority is approved.
Carney would not give any details of that Treasury priority list or when it would be unveiled, saying only that information would be made public before the Aug. 2 deadline.
He also said White House officials are hopeful that “Congress will come to its senses, and cooler heads will prevail” before they reach the deadline.
Earlier this week, administration officials told veterans groups that they’re committed to protecting active-duty military and their families from this latest budget fight, but would not promise that benefits for either group will be covered.
Efforts by lawmakers to protect military paychecks in the event of a federal fiscal crisis remain stalled on Capitol Hill – much like the larger debt-limit negotiations.
Several bills introduced months ago have not been brought to the floor of either chamber for a full vote. On Tuesday, a group of 31 Republican senators introduced legislation to prioritize payments for debt service, Social Security and active-duty military pay, saying they reflect the country’s top priorities.
On Wednesday, Disabled American Veterans hosted a “Virtual March on Washington,” drawing thousands of supporters to its social media platforms to demand that Congress honor its “moral obligation” by protecting veterans benefits from the ongoing budget fights.
Pentagon officials this week have avoided specifics on what will happen to paychecks and military contracts if an agreement isn’t reached, but did say they are in discussions with administration budget officials. Any halt in military pay, they said, would likely only be temporary, with troops receiving back pay once an agreement is worked out.
But even a temporary halt in pay could be financially crippling to many servicemembers. In an interview with Defense News earlier this month, Joint Chiefs Chairman Adm. Mike Mullen said that “some of our troops … are living paycheck to paycheck, so I think we have to be very careful.”
Already, several military credit unions and banking groups have announced they’ll offer troops advances on their paychecks if the debt-limit crisis isn’t averted.
In a statement, officials from Andrews Federal Credit Union said the money will help “pay mortgages and other important expenses, even when their government paycheck is unavailable.” USAA financial planners have also promised to offer some assistance to veterans and civilian defense workers, if their payouts are stopped.
Reporter Kevin Baron contributed to this story.