Saving Social Security, Again

Accuracy in Academia ^ | December 9, 2010 | Malcolm A. Kline

[Academiadotorg]

When trying to convince dubious students of the benefits of social security when they are all too familiar with the costs, professors might well ask the question: “Who are you going to believe, me or your paycheck?”

“Social Security is safe and can still pay the vast majority of promised benefits if

nothing changes between now and 2037, and even then benefits’ cuts would range

from 21 percent to 24 percent if reform is not undertaken,” University of Massachusetts economist Christian Weller writes in a report released by the Center for American Progress (CAP). “But Congress can take prudent policy steps sooner rather than later to guarantee strong benefits for generations to come.”

The current debate over saving the social security system revolves around either cutting the program’s outlays or increasing contributions to them. The president’s deficit commission recommends a combination of both.

The plan that Weller devised for CAP raises taxes and benefits. Among the beneficiaries in CAP’s plan are same-sex couples. “All legally married couples regardless of their sexual orientation should be entitled to the same insurance benefits under Social Security,” Weller asserts.

Weller, a professor of public policy at the University of Massachusetts-Boston, also serves as a senior fellow at CAP.

[Niuhuru]

Cut out welfare breeders
Cut out illegal immigrants
Cut out people on it with no work history

[ClearCase_guy]

It’s a ponzi scheme.

[DManA]

Sure it’s doable of the politicians are willing to cut drastically every other part of the budget.

[DManA]

We have to be willing for the Federal budget to have two items on if for 20 years 1. Defense, 2. Social Security.

[DManA]

Oh, and 3 Interest on the debt.

[Parmy]

That is undoubtably true. But, Congress and all the administrations have been stealing the surpluses for over 30 years. They have been worse than a Las Vegas mob boss running a casino.

There is an estimated 2.5 trillion dollars of IOU's in a file cabinet that are non-negotiable Treasury bonds to cover the criminal activity.

To fix SS, just pay back all of the surpluses that have been stolen from the SS system.

Also, a non-negotiable bond is worth nothing because it can't be sold, traded or anything. Although it could be used in an outhouse instead of a Sears catalog.

[Publius6961]

Center for American Progress (CAP).

Before I waste any more time on this thread, does anyone have a quick way to determine if this is one of Soros-funded tentacles?

The Center has no information on its website about its funding, but the Washington Post reported that "seed money pledged by such deep-pocketed Democrats as financier George Soros and mortgage billionaires Herbert and Marion Sandler" assisted its formation.[6]

This statement is supported by the following link :

Partial News Column

Yes, it is Soros-funded crap.
Bye.

[November 2010]

Either we can keep doing what we’ve been doing with minor tweaks . . . or we could go broke as a nation, default on our debt, and bequeth a a third world country to our children and grandchildren.

[Publius6961]

We have to be willing for the Federal budget to have two items on if for 20 years 1. Defense, 2. Social Security.

An inescapable choice if our economic system is to survive at all, but...

If, and only if, the three permanent changes listed in post #2 above are made to Social Security. And made bulletproof.

[kabar]

“Social Security is safe and can still pay the vast majority of promised benefits if nothing changes between now and 2037, and even then benefits’ cuts would range from 21 percent to 24 percent if reform is not undertaken,”

The 2037 date is bogus. SS is a pay as you go system. Once SS goes permanently in the red in 2016, i.e., beneftis exceed revenue, the shortfall must be made up by the General Fund thru the redemption of the non-market T-bills in the SSTF, which is an unfunded liability and the reason why the SSTF is included in the national debt under Intragovernmental Holdings.

[LibLieSlayer]

Yep... drive a stake through its heart.

LLS

[Parmy]

What they haven't told you and they never mention is that prior to the Johnson admin. there actually was a trust fund and SS wasn't in the general fund. Congress, seeing the build up of cash in the trust fund in the fifties wanted to get their hands on it then. But, they knew Eisenhower would never allow it.

Then along came Johnson and a Democrat controlled Congress. The trust fund was disbanded and the funds moved into the General Budget. Then it was Katy-Bar-the-Door. The built up funds were gone through like a dose of salts through a cow.

And, ever since the Seventies they have used the surpluses generated by SS deductions from payrolls to apply to the deficit cause by the over spending.

Give us back the IOU's and then we will see what the system looks like then.

[kabar]

Give us back the IOU's and then we will see what the system looks like then.

We don't have $2.6 trillion to give back. And the Ponzi scheme called SS is unsustainable. In 1950, there were 16 workers to every retiree; today there are 3.3; and by 2030 there will be two.

[Parmy]

Doesn't matter if we don't have the 2.5 trillion. It is a debt that is owed to all SS present recipients and all future recipients who have paid into the system.

Why do you want to allow the Congress to back out of its debt? I can't back out of mine. To say, "Ah! It's ok. I don't mind being screwed. I even enjoy it is a backward way of thinking.

Regarding you number of workers supporting the system, that is solvable. Reduce taxes. Cut the spending and quit scarfing the present surpluses. That will cause employment to increase. Ergo! More working to pay into the system.

Simple!

[kabar]

Doesn't matter if we don't have the 2.5 trillion. It is a debt that is owed to all SS present recipients and all future recipients who have paid into the system. Why do you want to allow the Congress to back out of its debt? I can't back out of mine. To say, "Ah! It's ok. I don't mind being screwed. I even enjoy it is a backward way of thinking.'

The amount of the debt is really irrelevant since SS is a pay as you go system. We don't need a SSTF, just the fact the full faith and credit of the USG to pay the benefits due. SS represents an unfunded liability of $18 trillion.

Regarding you number of workers supporting the system, that is solvable. Reduce taxes. Cut the spending and quit scarfing the present surpluses. That will cause employment to increase. Ergo! More working to pay into the system. Simple!

It is a matter of demographics. We are an aging society. 10,000 people will retire every day from now to 2030. By 2030 one in five residents of this country will be 65 or older.

Bureau of the Census: An Older and More Diverse Nation by Midcentury

[Parmy]

I can see that you believe the claptrap that the politicians and media spews. A debt is a debt is a debt.

It is not an unfunded liability. Millions of people have, along with their employers, paid into the system. To spend the surpluses which the SS system is still generating is tantamount to thievery.

But if you don't value your income and work, you are an easy mark for the thieves. I have a bridge somewhere I would like to sell you. I don't own it, but for you, what does that matter?

[kabar]

I can see that you believe the claptrap that the politicians and media spews. A debt is a debt is a debt.

No, I understand how SS works. It is a pay as you go system. Once all the benefits are paid, any "surplus" is put into the General Fund and Treasury issues non-market, interest bearing T-bills in the amount of the surplus and deposits it into the SSTF, which has about $2.6 trillion in such instruments [read IOUs]. When SS goes into the red as it is now and will go permanently in the red in 2016, the SSTF redeems the T-bills thru the general fund. There is no doubt that the SSTF represents a debt, which is why it is held as part of the national debt under Intragovernmental Holdings rather than publicly held debt.

It is not an unfunded liability. Millions of people have, along with their employers, paid into the system. To spend the surpluses which the SS system is still generating is tantamount to thievery.

The SSTF isn't an unfunded liability per se. They are non-market T-bills that the USG must redeem. The real scam is the SSTF. We don't need it. We would be far better off having SS as a line item in the federal budget and pay benefits from total tax revenue, including payroll taxes, which are really income taxes. I spoke a few years ago to Tom Saving, a former, long term SS Trustee. He said that this was the best way to go and it would force Congress to address the real costs of the program. And then we could stop the charade of supluses.

SS, as currently structured, represents an unfunded liability of $18 trillion.

Status of the Social Security and Medicare Programs

OASI, DI, and HI Trust Fund Ratios (Assets as a percentage of annual expenditures)

Social Security and Medicare Cost as a Percentage of GDP

SS has been a cash cow for the USG and the politicians. Its "surplus" was just a cover for more tax revenue. Now SS is becoming a black hole as the USG must cover the differences between outgo and revenue. We all know that the way the politicians will "save" SS is to reduce benefits and increase taxes so they can generate more "surpluses."

[Parmy]

Until the 2.5 trillion is paid back, one cannot make a truthful decision as to whether the fund will run out of money in this year or that year. Granted it has been turned into a pay as you go situation because the surpluses have been skimmed/stolen from the contributions.

Raising the retirement ages and increasing the contributions is not a solution because it doesn't address the fundamental problem that I just described.

All the graphs and utterances from so-called experts mean exactly nothing. It is graphs and experts that have gotten us into the present situation.

What is need now is some good, old, down home common sense. And, some hard mindedness that calls a spade a spade.

Do you know what an expert is? He/she is an X with a pert behind it.

[kabar]

Until the 2.5 trillion is paid back, one cannot make a truthful decision as to whether the fund will run out of money in this year or that year. Granted it has been turned into a pay as you go situation because the surpluses have been skimmed/stolen from the contributions.

Paid back? The SSTF has $2.5 trillion in non-market, interest bearing T-bills. They will be used, and they are being used now, when outgo [benefits] exceeds revenue [payroll tax.] The USG must redeem them.

SS has always been a pay as you go system. The issue is not whether SS will be paid back or not, but rather whether the USG can afford to carry its national debt. The $2.5 trillion in the SSTF is just part of the national debt of almost $14 trillion. The problem is that the USG will have to borrow money or increase income and other taxes to redeem the bonds in the SSTF.

All the graphs and utterances from so-called experts mean exactly nothing. It is graphs and experts that have gotten us into the present situation.

Now you are being silly. These graphs I provided portray the actual situation we are in vis a vis SS. It comes from the SS Trustee reports. We can not sustain SS as currently structured. Demographics and the fact that SS COLA increases [CPI-W] are not linked to revenue make the system unsustainable. These are actuarial statistics. It is really simple math. We must either decrease benefits or increase revenue to make the system balanced fiscally. We did something similar in 1983 when SS went into the red. Personally I prefer personal accounts and privatizing SS except for a small defined benefit program to cover disability and survivor benefits.

The next great bailout: Social Security Fortune's-- Allan Sloan takes a look at the troubled retirement program, why it's more important now than ever - and how lawmakers can repair it.