President Joe Biden speaks about his administration's plans to protect Social Security and Medicare and lower healthcare costs, Feb. 9, 2023, at the University of Tampa in Tampa, Fla. Credit: Patrick Semansky / AP

Hundreds of thousands of Mainers could see tax refund delays and benefit interruptions if Congress doesn’t raise the debt ceiling later this year in a fiscal crisis the state’s senior senator is tasked with averting.

Any program or person getting money from the federal government could feel the effects of a failure to pay its bills. That includes potential tax refund delays to 551,000 Mainers, Social Security payment disruptions to 355,000 seniors, benefit delays to 105,000 Maine veterans and heating assistance reductions to 30,000 Mainers, according to new data from the liberal Maine Center for Economic Policy.

It still is not clear exactly when the U.S. will reach the point of starting to default on national debt, but it could be as early as June, according to some economists. The debt ceiling has been raised 78 times since 1960, 29 times under Democratic presidents and 49 times under Republicans. The country has never defaulted.

“The government should not default on its debt because it would be devastating to the economy and our standing in the world,” said U.S. Sen. Susan Collins of Maine, the leading Republican on the powerful Senate Appropriations Committee, which drafts federal spending bills.

The debt ceiling is the maximum the government can borrow from the Treasury to pay its bills. The U.S. hit its spending limit of $31.4 trillion on Jan. 20. That leaves a divided Congress arguing about how to increase the limit so it can borrow more to pay outstanding bills and interest.

Some experts are worried that may change this time because House Republicans want to cut spending dramatically and are at odds over that with President Joe Biden, who initially said he would not negotiate over cuts. However, Biden and House Speaker Kevin McCarthy, R-California, have since met to begin discussions.

“It is imperative that additional productive discussions take place,” Collins said.

On top of debt-ceiling negotiations, the U.S. should be doing a better job than it has been with balancing the budget each year, said Garrett Martin, CEO of the Maine Center for Economic Policy. Those talks should take place during budget negotiations and are separate from deciding whether to raise the debt ceiling, he said.

Martin likened the situation to a person who has credit card debt that they can’t pay and who faces a “whole host of consequences.” To prevent more issues, the person would need to plan how to earn more money, curtail spending or both.

“We have to not only be willing to talk about how we’re going to cut spending, but also about how we’re going to raise revenue,” he said.

As the possibility of default on the national debt nears, the government might prioritize which programs get paid first, Martin said. Those decisions could be difficult, since 365,000 older Mainers receive Medicare benefits, MaineCare disruptions could affect 128,000 children and 107,000 adults, and food assistance reductions could hit 88,000 households in the state.

However, what could happen isn’t entirely clear, and some Mainers may be affected more than others.

“We’re entering unprecedented territory,” he said. “But if people are left without the resources to meet their basic needs, that in itself tells you all you need to know about what’s at stake for families and communities.”