Sen. Nelson seeks to protect Social Security payments with new Treasury authority

Nelson did not specifically criticize Obama for these comments, but did say Wednesday that the government should not be scaring seniors this way.

"Now, why in the world would we want to scare the bejabbers out of 45 million senior citizens of this country, some of whom literally are living hand to mouth and from Social Security check to Social Security check and some of whom cannot afford the cost of drugs even partially provided for through Medicare Part D, the prescription drug benefit?" he asked. "I don't think we want to do that."

Nelson later clarified that 56 million seniors receive Social Security payments.

Under his proposal, Treasury would be given the authority to issue new debt to cover any gap in funding needed to cover Social Security payments in August. Nelson said this authority is similar to the authority Treasury received from Congress in 1996 to cover these payments.

Nelson confessed that he does not think Congress will take up his proposal, S. 1364, but encouraged members to review the idea. At the same time, there are now less than three weeks before the Aug. 2 debt-ceiling deadline is reached, and the White House and House Republicans do not appear to be near any agreement.

Just Wednesday, Obama reportedly left the last negotiating session abruptly, and the two parties continue to bicker over the extent to which spending cuts and tax hikes should be part of the equation.

Also on Wednesday, a few House Republicans charged that Obama was threatening the non-payment of Social Security funds to seniors as a way of gaining leverage in the negotiations.