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Today around the watercooler, us active duty military, and civil service employees were discussing the possible effects of the US defaulting. Since we are all paid by the government, this is a very intensely personal issue to all of us. During the discussions, a claim was made that I found hard to believe.

CLAIM: If the US Government defaults, and must decide what bills and services to not pay, by law, Congressional pay is protected, and would be the last thing NOT paid (i.e. all other government bills would be cut before congressional pay gets cut).

Is this at all true?

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    When you think it over, this sounds a lot less outrageous than you’d initially feel, even if actually true: a running government is eminently important, especially when there’s a huge (financial) crisis. Preventing that the government can no longer function is likely near the top of the priorities list.
    – Konrad Rudolph
    Commented Jul 26, 2011 at 19:09
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    @Konrad - That would be true if you accept that you must pay congress to do their job. I would think that it would be better incentive to get things working if your pay depended on it.
    – Chad
    Commented Jul 26, 2011 at 21:01
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    @AgentKC - Actually the military would deal with it like they do all things, stoically and professionally. Now the government union employees on the other hand...
    – Chad
    Commented Jul 26, 2011 at 21:02
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    If the us defaults, it will merely stop paying back its bonds for some time. It's not like bankruptcy. It will merely say to its creditors to wait some extra time (or indefinitely) to have the bonds paid back. It would be quite bad because it would make it very difficult for the us to get any further credit.
    – Sklivvz
    Commented Jul 26, 2011 at 22:39
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    @vartec: Belgium currently has 5 governments instead of their usual 6. (Flemish, Flanders, Brussel, Walloon and German). That really should be sufficient ;)
    – MSalters
    Commented Jul 28, 2011 at 9:33

1 Answer 1

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It looks like they might be because the office of Congressman Jim Cooper (D-Tenn.) has proposed a measure to prevent it from happening; although I don't think there are any hard rules on the books about this.

Source: http://nashvillecitypaper.com/content/city-news/cooper-wants-congressional-pay-stopped-if-us-defaults-debt

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