What Happens At Social Security In Case Of A Government Shutdown?

Let me give you my speculation on what will happen at Social Security in case of a government shutdown. Remember, I have no inside information.

The last time there was a government shutdown caused by a budget impasse the vast majority of Social Security's employees were initially furloughed but most of them were soon called back to work even as the impasse continued. Does this mean that most Social Security's employees would escape a furlough if there is a general government shutdown this time? The Anti-Deficiency Act says that it is illegal to "involve either [the federal government or the District of Columbia] government in a contract or obligation for the payment of money before an appropriation is made unless authorized by law." A straightforward reading of that law makes one wonder how Social Security employees were called back in 1995.

There may be some ways around the Anti-Deficiency Act but the first question is whether the President wants to get around it. Republicans have taken an aggressive stance against government in general, a stance that borders on anarchism, the belief that government is so terrible that we would be better off without a government. Perhaps the best way to demonstrate the folly of anarchism is to remind everyone of all that the federal government does for us. Shut down air traffic control and you shut down civil aviation. Shut down the Federal Reserve and you may well shut down banks and stock exchanges. Shut down the Department of Agriculture and food production in the U.S. may shut down. Shut down the Department of the Treasury and Social Security checks stop going out. Shut down the Department of Veterans Affairs and VA hospitals start shutting down. Even Rand Paul might blanch at the prospect of all this happening.

Let us assume, however, that the President wants to ameliorate the effects of a government shutdown at Social Security. Here are some things he can do:

• The President has some poorly defined emergency powers that apparently include budgetary powers that may supersede the Anti-Deficiency Act to some extent. 50 U.S.C. §1641(c). This was almost certainly the justification used when most Social Security employees were called back to work in 1995.
• The economic stimulus bill enacted soon after President Obama was elected included a good deal of money for Social Security that has not yet been expended. The money that is left was intended for construction of a new national computer center for Social Security but was not so limited in the appropriation. Some of that money has been spent and Social Security has contractual obligations on some of the rest but I think that there is still a pot of money available in an emergency. The agency could spend the money with the assurance that the pot can be refilled once the money starts flowing again. This money may be enough to keep Social Security going for a time.
• Social Security also squirreled away $280 million from last year's appropriation in a "no year" account. That money may be available to be spent in an emergency, assuming it has not been committed to long term information technology projects.

Stay tuned. I would not expect any announcement of what the plans are until the very last minute. Let us hope that there is no need to ever announce those plans.

Let me make one warning: If any Social Security employees are furloughed, do not expect that their salaries will be made up as happened in 1995. I doubt that employees who were furloughed can be paid for their time off without at least tacit Congressional approval. In 1995 Republicans did not want to alienate government employees. This time around, Republicans are not only willing to hurt public employees, they seem eager to do so. If Republicans have an enemies list in 2011, public employees are at the top of it.