defaulting on SS and Medicare obligations is effectively theft or fraud.
Even canceling the programs (which I'm not calling for BTW) wouldn't be a default. There is no debt to default on. Its federal spending just like farm programs (which can also be doled out by a legal formula) or defense. In fact making defense suddenly zero would be more of a default (since there are actual contracts, mostly they could be canceled by paying a penalty but that also requires money, not paying the penalty would be a default). There even was a supreme court case about entitlements, there spending required by law, but the recipient doesn't' have a property right to the benefits (until they actually receive them, and then only for what they received not for future payments), and congress could change the formula in the law just as they could change any other laws.
As for Social Security with no legal changes it is set up to have a sudden and large cut when the nominal trust fund goes to zero and there isn't enough new SS money coming in to it. The cut might have to be a quarter or a third of the otherwise expected payment. Thisn't isn't a change in budget or SS law its just applying the current law as written. Edit - The current estimate is a little under a quarter.
The fact that people conflate those funds with other government funds
They conflate them because they are government funds. The entire Social Security Program is part of the federal government, not an independent entity.
why you can so blithely claim that paying back "interest on the debt" has a higher priority than meeting SS and Medicare obligations.
There is a debt obligation for federal debt. Its owed to someone. Future streams of income from Social Security or payments for medical care under federal medical entitlement programs are not owed to people, there is no debt, just a political promise and the current program setup that could be changed just as congress can change any other law.
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Background
Ephram Nestor challenged Section 1104 after he was denied Social Security payments as a deported member of the Communist Party. He argued that a contract existed between himself and the United States government, since he had paid into the system for 19 years.
Nestor, an alien, became eligible for Social Security payments in 1955. In July 1956 he was deported for having been a member of the Communist Party from 1933 to 1939. Section 202(n) of the Social Security Act provided for the termination of Social Security payments when an alien is deported for being a member of the Communist Party.
Opinion of the Court
The Court ruled that no such contract exists, and that there is no contractual right to receive Social Security payments. Payments due under Social Security are not “property” rights and are not protected by the Takings Clause of the Fifth Amendment. The interest of a beneficiary of Social Security is protected only by the Due Process Clause.
en.wikipedia.org
In this 1960 Supreme Court decision Nestor's denial of benefits was upheld even though he had contributed to the program for 19 years and was already receiving benefits. Under a 1954 law, Social Security benefits were denied to persons deported for, among other things, having been a member of the Communist party. Accordingly, Mr. Nestor's benefits were terminated. He appealed the termination arguing, among other claims, that promised Social Security benefits were a contract and that Congress could not renege on that contract. In its ruling, the Court rejected this argument and established the principle that entitlement to Social Security benefits is not contractual right.
ssa.gov
the U.S. Supreme Court found that "Social Security is not guaranteed." — David Jolly on Tuesday, February 25th, 2014 in a Congressional campaign debate
politifact.com |
