Full Faith and Credit Act

To protect social security benefits and military pay and require that the United States Government to prioritize all obligations on the debt held by the public in the event that the debt limit is reached. 1. Short title This Act may be cited as the Full Faith and Credit Act 2. Prioritize obligations on the debt held by the public, social security benefits, medicare, veterans, and military pay If the debt of the United States Government reaches the statutory limit under section 3101 of title 31, United States Code, the following obligations shall take equal priority over all other obligations incurred by the United States Government: (1) The authority of the Department of the Treasury provided under section 3123 of title 31, United States Code, to pay with legal tender the principal and interest on debt held by the public. (2) The authority of the Commissioner of Social Security to pay monthly old-age, survivors', and disability insurance benefits under title II of the Social Security Act ( 42 U.S.C. 401 et seq. (3) The payment of pay and allowances for members of the Armed Forces on active duty and members of the United States Coast Guard. (4) The payment of compensation and pensions, and payments for medical services, provided by the Department of Veterans Affairs. (5) The Medicare programs under parts A, B, C, and D of title XVIII of the Social Security Act ( 42 U.S.C. 1395c et seq. 3. Limited debt limit authority (a) In general If the Secretary of the Treasury determines, after consultation with the Director of the Office of Management and Budget, that incoming revenue will not be sufficient to pay the priority obligations specified under section 2 over an upcoming 2-week period during a period during which the debt of the United States Government has reached the statutory limit under section 3101 of title 31, United States Code— (1) the Secretary, in coordination with the Director of the Office of Management and Budget, shall notify Congress of the amount of the expected revenue shortfall from the revenue required to pay in full the priority obligations specified under section 2 for such 2-week period; and (2) the amount of the limit on debt held by the public under section 3101 of title 31, United States Code, shall be increased by the amount of the expected revenue shortfall. (b) Excess revenue If incoming revenue exceeds the amount projected under subsection (a), any amount in excess shall be held in reserve and applied to the following 2-week period. September 22, 2021 Read the second time and placed on the calendar

Summary: Full Faith and Credit Act This bill requires the Department of the Treasury to prioritize certain obligations if the federal debt limit is reached and provides for a limited increase in the debt limit to fund these priorities. If the federal government reaches the debt limit, the following obligations must be given equal priority over all other federal obligations: the principal and interest on the debt held by the public; Social Security benefits; pay and allowances for members of the Armed Forces on active duty and members of the U.S. Coast Guard; compensation, pensions, and payments for medical services provided by the Department of Veterans Affairs, and the Medicare programs. If the debt limit has been reached and incoming revenue will be insufficient to pay the priority obligations over an upcoming two-week period, the bill requires (1) Treasury to notify Congress of the expected revenue shortfall for the two-week period, and (2) the debt limit to be increased by the amount of the expected shortfall. If the incoming revenue exceeds the expected shortfall, the excess revenue must be held in reserve and applied to the following two-week period.