The "raiding" of the Social Security Trust. What you don't know, and why you're probably an idiot.

[kaz]

A real school that thinks loaning money to yourself is an asset? So they are a "real" what exactly? Fortunately you paid them in Canadian dollars, not real money

You are not loaning yourself money. You are paying into a trust fund from which you are receiving debits that build up over time. When you retire, you will have a claim on the trust, which will pay down as you draw SS benefits. There are all sorts of financial entities which offer this. It's no different than how an annuity or defined contribution pension plan works.

Do you have a cash management service from a bank for your business? Are they investing in money market funds? That MM fund will be invested in Treasury bills, which are claims on the US Treasury. That MM fund is an asset of yours and a liability of the Treasury.

All debt is an asset of someone else. If you own debt of GE, that is an asset of yours and a liability of GE. If you own Treasury securities, that is an asset of yours and a liability of the US Treasury.

The SS trusts are no different. The assets of the SS trusts are what is owed to it by the US Treasury. The liabilities of the trusts are the claims on it from the recipients.

It isn't "us lending to ourselves." It is an inter-generational distribution of assets and liabilities within the nation.

If there is a social security trust fund, then your children pay for your social security in Federal taxes. If there is no trust fund, your children pay for your social security in Federal taxes.

At some point, you got lost in the syntax of securities and you forgot what they actually are

I know exactly what they are. As I explained in my link earlier in this thread, SS acts EXACTLY like a government bond fund. Except rather than issuing formal securities, the trusts are debited and credited as if they were buying and selling Treasury securities. The flow of funds and the balance sheets are EXACTLY the same. It is economically no different than you investing your retirement in a Fidelity government bond fund - which you can. The difference is that the trusts cut out the middle man.

There are some practical differences between issuing securities and nonmarketable liabilities, but the economics are the same.

Actually, there is a major "practical difference." The government saved zero, it spent the money as it came in, and like if there was no trust fund, your children will be taxed to pay for it.

Whether there is a "trust fund" or not, there is no economic difference. The government has no assets other than those which are cancelled out by debt. When you add a number to it's negative, you get zero every time, and that's the net value of the the "trust fund." Read your post, you demonstrate exactly my point that you're lost in syntax and the actual meaning of assets and securities has been lost to you. A security based on an asset with an underlying value of zero isn't a real asset, it's a scam when it's treated as being an asset, and that's what social security is, a scam

 

[Flash]

the thought of a RW wanting to, or managing an investment portfolio when they can't understand the difference between deficit/debt makes me cry with laughter.

Do you understand the difference? Please elucidate!

If this is a GAMBLE tell me why people have been investing for the last 119 years?
The DJIA first appeared on May 26, 1896,
The starting point for the DJIA was 40.94,
a far cry from the 17,910 average in November 6,2015.
An average annual growth rate of the DJIA of 376%!!!
www.businessnewsdaily.com/3342-dow-jones-industrial-average.html

But of course people like YOU know so much more about how to accumulate nest eggs!

By the way all opinions are based on facts. Facts that can be sourced.

Where are your facts that you base your "opinion" on?

These Libtards have no faith in their ability to manage their own money. They want a corrupt politician, elected by special interest groups to mange their money for them. Then they wonder why we ridicule them for being idiots.

In Texas a sizable group of public employees were able to opt out of Social Security and manage their own retirement fund and their pensions are significantly larger than what they would have got with Social Security and this was after the dive in the stock market after 911 and the housing bust.

USATODAY.com - A model for Social Security reform

A model for Social Security reform

The current debate about reforming Social Security reminds me of the discussions that occurred in Galveston County, Texas, in 1980, when our county workers were offered a different, and better, retirement alternative to Social Security: They reacted with keen interest and some knee-jerk fear of the unknown. But after 24 years, folks here can say unequivocally that when Galveston County pulled out of the Social Security system in 1981, we were on the road to providing our workers with a better deal than Franklin Roosevelt's New Deal.

Our plan vs. Social Security

Upon retirement after 30 years, and assuming a more conservative 5% rate of return, all workers would do better for the same contribution as Social Security:

• Workers making $17,000 a year are expected to receive about 50% more per month on our alternative plan than on Social Security — $1,036 instead of $683.

• Workers making $26,000 a year will make almost double Social Security, $1,500 instead of $853.

• Workers making $51,000 a year will get $3,103 instead of $1,368.

• Workers making $75,000 or more will nearly triple Social Security, $4,540 instead of $1,645.

• Our survivorship benefits pay four times a worker's annual salary — a minimum of $75,000 to a maximum $215,000 — rather than Social Security's customary onetime $255 survivorship to a spouse (with no minor children). If the worker dies before retirement, the survivors receive not only the full survivorship but get generous accidental death benefits, too.

• Our disability benefit pays 60% of an individual's salary, better than Social Security's.

 

[JoeTheEconomist]

There is much discussion on this on this board. Almost any time SS and it's solvency (or lack thereof) is discussed, everyone talks about how SS has been "raided" and used to pay for other things. The problem here is that most of you, Democrat and Republican alike, who say this don't have a clue what you're talking about. So here, I'll explain it to you. I'd like to say that we could put the issue to rest once and for all, but I doubt that will be the case.

Before I begin, a prediction: Many of you will rush to respond without bothering to read, and in the process you'll jump to conclusions and make an ass out of yourself. Some will rail off on wild tangents. Many dissenters will be folks who claim to be conservatives, but are really just fake ass Cinos who like to complain and whine, and will be completely oblivious to the highly damaging implications I'll be presenting against the entire SS system. But you'll feel good because touching yourself always feels good. Many dissenters will be liberals, who will "like" this post, will note the Cinos dissenting for all the wrong reasons, and based upon that, will launch into your Hooray for Government dance, as if idiots being wrong instantly means that government is the solution to all our problems. Finally, if most people are adequately drawn to my blue highlighting of this paragraph so as to read it, and subsequently see their planned reaction described herein, few responses will be made because you'll realize that you've already been identified and you're now embarrassed at how much of an ass of yourself you were about to make.

Okay, now that that's cleared up, let's talk about the Social Security Trust, and what happens to the money.....

Overall, the Social Security Trust is fairly simple. Money goes in with the express purpose of being used to fund Social Security. It can't be used to pay to fuel up Air Force One for Obama's latest golfing venture. Simple. That being said, money static is money lost. That is to say, if money just sits on the coffee table, it's not doing anything except sitting there. In our personal lives most people know that building up a nest egg of cash that is doing nothing typically means lost opportunities. We could invest that money and make more money. Even something as simple and safe as putting it into a Certificate of Deposit with your bank might return a little bit of cash, all while you sit back and play video games for the next 18 months. If you're not going to be using your nest egg anyway, it's like giving up free money to just let it sit there.

That's why many, many years ago Congress passed a law that requires excess funds in the Social Security Trust to be "invested." Instead of just sitting there and collecting dust, the excess is invested and collects interest, which is then rolled back into the Trust. This "investing" is done in the form of intra-governmental loans. Basically, the government borrows money from itself, on a short term basis, in pretty much the same fashion as other government borrowing occurs. A bond is given to the Trust, and a few months later the Trust is repaid with interest.

Now, you might be thinking that "Well, this really does amount to raiding the SS Trust to pay for other things." On it's surface, it might appear that way. But in reality, it's not that way. And there are two reasons for that:

1 - At it's core, it's little more more than moving around cash. If your car broke down on Wed and you were short on cash, causing you to transfer $500 from your savings into your checking until payday Friday, at which point you put back the $500 plus added your normal per-paycheck savings contribution, would you call that "raiding" your savings account to pay you mechanic? Of course not. All you did was move your own cash around so that your check won't bounce.

2 - The law requires that the Trust be invested in his way. It doesn't matter how much or how little the government is spending on other things. Congress could pass a balanced budget, and the same thing would happen. Heck, the Congress could pass a budget that only authorizes $1,500 in spending, and the same thing would still happen. The Trust would still be invested, and the government would still borrow from itself.

This is why you may have heard such seemingly absurd things as "The debt is $18 trillion, but the real dept is only $10 trillion." What the "real" debt refers to is the amount of debt that is not in the form of intra-governmental loans; intra-governmental loans are included in the official calculation of the debt, so a sizable part of the $18 trillion includes cash that the government has just shifted around between accounts. (***Note: I do not know the actual figures off the top of my head, the $10 trillion amount is merely an explanatory tool).

Now that we understand that investing the excess funds in the Social Security Trust by means of intra-governmental debt is a long standing legal requirement that happens without regard to how much the government spends, some people might be ready to rejoice in the alleged marvel that is the Social Security system. Some might feel relieved that in fact the SS Trust is not being "raided" and might even see this as evidence that SS can remain solvent for many decades to come. But don't be so fast to celebrate. Because everything I've just said actually underscores the fact that Social Security is a drain on the American economy, and on the taxpayer.

As I explained, when excess funds from the SS Trust are loaned out to other parts of the government they are paid back with interest. This brings more money into the Trust. That money didn't come from your SS payroll taxes. It comes directly from your income tax. You are investing more money into the SS Trust than just your SS taxes!! The SS Trust is like a black hole. It sucks in money from every direction, and all it spits out are the decayed remnants of what's left over.

And.... This pot of money is roughly 2.8 trillion. It is held in reserve against 30 trillion in unfunded obligations.

The amount of money a person receives in terms of SS retirement benefits will almost always be less than what you've paid into it as SS taxes. And now that we understand that we invest more than just our SS taxes into the SS Trust, the disparity of return is understood to be even greater. Allowing individuals to retain their SS taxes would allow them to instead invest those funds into retirement plans that would yield better returns, resulting in having more funds available for their own retirement. Additionally, the interest that the SS Trust sucks in from the taxpayers would result in a net savings of government expenses, allowing for lower deficits.

Do you have a source for this statement? If you allow individuals to retain their SS taxes, we will simply have to have more taxes from somewhere else.

 

[JoeTheEconomist]

the thought of a RW wanting to, or managing an investment portfolio when they can't understand the difference between deficit/debt makes me cry with laughter.

Do you understand the difference? Please elucidate!

If this is a GAMBLE tell me why people have been investing for the last 119 years?
The DJIA first appeared on May 26, 1896,
The starting point for the DJIA was 40.94,
a far cry from the 17,910 average in November 6,2015.
An average annual growth rate of the DJIA of 376%!!!
www.businessnewsdaily.com/3342-dow-jones-industrial-average.html

But of course people like YOU know so much more about how to accumulate nest eggs!

By the way all opinions are based on facts. Facts that can be sourced.

Where are your facts that you base your "opinion" on?

These Libtards have no faith in their ability to manage their own money. They want a corrupt politician, elected by special interest groups to mange their money for them. Then they wonder why we ridicule them for being idiots.

In Texas a sizable group of public employees were able to opt out of Social Security and manage their own retirement fund and their pensions are significantly larger than what they would have got with Social Security and this was after the dive in the stock market after 911 and the housing bust.

USATODAY.com - A model for Social Security reform

A model for Social Security reform

The current debate about reforming Social Security reminds me of the discussions that occurred in Galveston County, Texas, in 1980, when our county workers were offered a different, and better, retirement alternative to Social Security: They reacted with keen interest and some knee-jerk fear of the unknown. But after 24 years, folks here can say unequivocally that when Galveston County pulled out of the Social Security system in 1981, we were on the road to providing our workers with a better deal than Franklin Roosevelt's New Deal.

Our plan vs. Social Security

Upon retirement after 30 years, and assuming a more conservative 5% rate of return, all workers would do better for the same contribution as Social Security:

• Workers making $17,000 a year are expected to receive about 50% more per month on our alternative plan than on Social Security — $1,036 instead of $683.

• Workers making $26,000 a year will make almost double Social Security, $1,500 instead of $853.

• Workers making $51,000 a year will get $3,103 instead of $1,368.

• Workers making $75,000 or more will nearly triple Social Security, $4,540 instead of $1,645.

• Our survivorship benefits pay four times a worker's annual salary — a minimum of $75,000 to a maximum $215,000 — rather than Social Security's customary onetime $255 survivorship to a spouse (with no minor children). If the worker dies before retirement, the survivors receive not only the full survivorship but get generous accidental death benefits, too.

• Our disability benefit pays 60% of an individual's salary, better than Social Security's.

For all of your research.... you realize that you are about 10 trillion dollars out of date.

I will spare you the longer version of why your facts are not only out of date, but not terribly accurate. Here is my article on Bush's plan for SS ,

Bush’s plan would not have fixed Social Security

 

[JoeTheEconomist]

And the problem is that we are now at the point that there are no excess funds, so we now must pay back the trust to meet its obligations.

Would you really care whether the money was borrowed from the Trust Fund or China? The problem is at some point we have to pay back our obligations. The name on the check doesn't really make a difference.

 

[JoeTheEconomist]

What a load of crap. Taking our Social Security contributions and spending it on other crap without any means of repaying the money is not investing it. That will land you right in prison in the private sector. 2% interest that will never be paid is $0.00

That these corrupt thieves now tell us they have to raise the retirement age so that some of us will die before collecting a dime, and others will get less than promised or nothing at all is a clue that the money was not 'invested'. Government stole the money, they spent it, they can't pay us back so now they want to screw us over.

Yup and you can thank LBJ for putting SS in the General fund when he needed money for the Vietnam war. They have been robbing it ever since.

They rob our SS but they don't rob their own which is separate from ours.

You realize that Social Security at the time of LBJ was a pay-as-you-go system. There was almost nothing to put into the general fund certainly not enough to pay for Vietnam. But it sounds so reasonable.

 

[JoeTheEconomist]

A real school that thinks loaning money to yourself is an asset? So they are a "real" what exactly? Fortunately you paid them in Canadian dollars, not real money

You are not loaning yourself money. You are paying into a trust fund from which you are receiving debits that build up over time. When you retire, you will have a claim on the trust, which will pay down as you draw SS benefits. There are all sorts of financial entities which offer this. It's no different than how an annuity or defined contribution pension plan works.

Do you have a cash management service from a bank for your business? Are they investing in money market funds? That MM fund will be invested in Treasury bills, which are claims on the US Treasury. That MM fund is an asset of yours and a liability of the Treasury.

All debt is an asset of someone else. If you own debt of GE, that is an asset of yours and a liability of GE. If you own Treasury securities, that is an asset of yours and a liability of the US Treasury.

The SS trusts are no different. The assets of the SS trusts are what is owed to it by the US Treasury. The liabilities of the trusts are the claims on it from the recipients.

It isn't "us lending to ourselves." It is an inter-generational distribution of assets and liabilities within the nation.

Hmmm...

You have no claim on the trust, or any aspect of Social Security - Flemming V Nestor 1960.

The trust fund is held against a liability that is nearly 10 times larger than the Trust Fund. It is a dime of solution for every dollar of problem.

 

[Flash]

[


For all of your research.... you realize that you are about 10 trillion dollars out of date.

I will spare you the longer version of why your facts are not only out of date, but not terribly accurate. Here is my article on Bush's plan for SS ,

Bush’s plan would not have fixed Social Security

You may be confused.

That was a private plan in Texas.

They did much better than Social Security.

My position is that we don't need Social Security at all. No government plan or any hybrid. Thr filthy ass government should not be in the business of making sure that you plan for retirement. That is your responsibility.

Phase out the existing program making sure that anybody that paid into the plan gets their money back.

It is your responsibility to provide for your own well being including retirement.

If you are incapable of doing that then that is your problem. Don't spend so much of your money on Colt Malt Liquor and maybe you can afford retirement.

 

[Claudette]

What a load of crap. Taking our Social Security contributions and spending it on other crap without any means of repaying the money is not investing it. That will land you right in prison in the private sector. 2% interest that will never be paid is $0.00

That these corrupt thieves now tell us they have to raise the retirement age so that some of us will die before collecting a dime, and others will get less than promised or nothing at all is a clue that the money was not 'invested'. Government stole the money, they spent it, they can't pay us back so now they want to screw us over.

Yup and you can thank LBJ for putting SS in the General fund when he needed money for the Vietnam war. They have been robbing it ever since.

They rob our SS but they don't rob their own which is separate from ours.

You realize that Social Security at the time of LBJ was a pay-as-you-go system. There was almost nothing to put into the general fund certainly not enough to pay for Vietnam. But it sounds so reasonable.

Sorry to tell you but SS has 2.6 Trillion dollars in it. That's what its worth.

What Happened to the $2.6 Trillion Social Security Trust Fund?

And yes. The Govt. uses SS for non SS purposes.

Social Security Trust Fund - Wikipedia, the free encyclopedia

 

[JoeTheEconomist]

[


For all of your research.... you realize that you are about 10 trillion dollars out of date.

I will spare you the longer version of why your facts are not only out of date, but not terribly accurate. Here is my article on Bush's plan for SS ,

Bush’s plan would not have fixed Social Security

You may be confused.

That was a private plan in Texas.

They did much better than Social Security.

My position is that we don't need Social Security at all. No government plan or any hybrid. Thr filthy ass government should not be in the business of making sure that you plan for retirement. That is your responsibility.

Phase out the existing program making sure that anybody that paid into the plan gets their money back.

It is your responsibility to provide for your own well being including retirement.

If you are incapable of doing that then that is your problem. Don't spend so much of your money on Colt Malt Liquor and maybe you can afford retirement.

That plan covers a narrow part of Texas. It started at the start of the largest bull market in history. It had the luxury of walking away from the legacy debt of Social Security. Let's look at your low-wage worker... He makes $26,000 or nearly double the minimum wage. That may work in the government jobs, but reality is a little different.

Until you find $10+ trillion in new taxes, this is moot. Without new taxes you will not be able to pay benefits to existing retirees. Are you going to tell them to pound sand?

 

[JoeTheEconomist]

What a load of crap. Taking our Social Security contributions and spending it on other crap without any means of repaying the money is not investing it. That will land you right in prison in the private sector. 2% interest that will never be paid is $0.00

That these corrupt thieves now tell us they have to raise the retirement age so that some of us will die before collecting a dime, and others will get less than promised or nothing at all is a clue that the money was not 'invested'. Government stole the money, they spent it, they can't pay us back so now they want to screw us over.

Yup and you can thank LBJ for putting SS in the General fund when he needed money for the Vietnam war. They have been robbing it ever since.

They rob our SS but they don't rob their own which is separate from ours.

You realize that Social Security at the time of LBJ was a pay-as-you-go system. There was almost nothing to put into the general fund certainly not enough to pay for Vietnam. But it sounds so reasonable.

Sorry to tell you but SS has 2.6 Trillion dollars in it. That's what its worth.

What Happened to the $2.6 Trillion Social Security Trust Fund?

And yes. The Govt. uses SS for non SS purposes.

Social Security Trust Fund - Wikipedia, the free encyclopedia

It is now 2.8 trillion. If LBJ was president now, that might be meaningful. He isn't. He was president about 50 years ago, when the Trust Fund held about 20 billion. No 20 billion did not pay for Vietnam. SS was a paygo system until about 1984. Nearly 15 years after LBJ left office.

The piece from Forbes is painfully spammed. I get it so regularly, that I put a response piece on my personal blog. The piece has too many factual problems to list here. (If you want to see them: Joe The Economist: What Happened to the $2.6 Trillion Social Security Trust Fund?”) The fact problems are bad enough, but keep in mind that his entire piece depends upon Geithner and Obama telling the truth. Sorry I don't buy that.

Wikipedia? If you have something from SSA, I will believe it. As in : The Social Security Trust Fund has never been "put into the general fund of the government." (source : Social Security History)

 

[Fishlore]

Social Security is socialism -- no doubt about it -- and America loves it. Medicare is the son of Social Security, and America loves it. These programs inspire wild hostility from the right because righties correctly see them as the nose of the camel under the tent.

Going back to the founding of Social Security under FDR, Democrats have done a lot of tap dancing to avoid having to state the obvious: that the "Social" in Social Security is socialism. What SS secures is society. It does this by guaranteeing a minimum standard of living for people who can no longer earn.

Social Security is not an investment. It is not a retirement policy. It is a tax supported inter-generational social contract to maintain social stability. Stupid Republicans criticize Social Security for failing to do something it isn't attempting to do. Nobody cares about the quibble until some idiotic GOP politician suggests abandoning Social Security. Then, BOOM! the roof falls in on the Republicans and they go back to bellyaching about something else.

Social Security is a friggin Ponzi Scheme with a bankrupting $65 trillion liability. The payroll tax that funds the program has become a slush fund for every corrupt politician to raid to fund whatever they think they need to buy somebody's vote.

FDR was an idiot trying to impose socialism on the US.

Social Security is most definitely NOT a Ponzi Scheme. All Ponzi Schemes are predicated on the sale of securities. Social Security doesn't sell anything. Ponzi Schemes are driven by the investors' desire for profit. Social Security has no investors and does not claim to make profit.

Social Security is a tax program. Ponzi Schemes are not tax programs. The taxation rate is fixed by Congress, as are the eligibility and payment features. It is true that Social Security is inter-generational, that the benefits paid out today were raised by taxes paid previously. Ponzi Schemes never last that long.

The "Ponzi Scheme" nonsense is a tired meme of talk radio. You are, of course, entirely within your rights to hate Social Security and explain why you do so. To use tendentious false analogies as evidence is mere propaganda of the lowest sort. Not that it matters much. The fringe right has about as much chance of toppling Social Security as a mutt pissing on the Washington Monument does of knocking over that noble obelisk..

 

[JoeTheEconomist]

Social Security is socialism -- no doubt about it -- and America loves it. Medicare is the son of Social Security, and America loves it. These programs inspire wild hostility from the right because righties correctly see them as the nose of the camel under the tent.

Going back to the founding of Social Security under FDR, Democrats have done a lot of tap dancing to avoid having to state the obvious: that the "Social" in Social Security is socialism. What SS secures is society. It does this by guaranteeing a minimum standard of living for people who can no longer earn.

Social Security is not an investment. It is not a retirement policy. It is a tax supported inter-generational social contract to maintain social stability. Stupid Republicans criticize Social Security for failing to do something it isn't attempting to do. Nobody cares about the quibble until some idiotic GOP politician suggests abandoning Social Security. Then, BOOM! the roof falls in on the Republicans and they go back to bellyaching about something else.

Social Security is a friggin Ponzi Scheme with a bankrupting $65 trillion liability. The payroll tax that funds the program has become a slush fund for every corrupt politician to raid to fund whatever they think they need to buy somebody's vote.

FDR was an idiot trying to impose socialism on the US.

Social Security is most definitely NOT a Ponzi Scheme. All Ponzi Schemes are predicated on the sale of securities. Social Security doesn't sell anything. Ponzi Schemes are driven by the investors' desire for profit. Social Security has no investors and does not claim to make profit.

Social Security is a tax program. Ponzi Schemes are not tax programs. The taxation rate is fixed by Congress, as are the eligibility and payment features. It is true that Social Security is inter-generational, that the benefits paid out today were raised by taxes paid previously. Ponzi Schemes never last that long.

The "Ponzi Scheme" nonsense is a tired meme of talk radio. You are, of course, entirely within your rights to hate Social Security and explain why you do so. To use tendentious false analogies as evidence is mere propaganda of the lowest sort. Not that it matters much. The fringe right has about as much chance of toppling Social Security as a mutt pissing on the Washington Monument does of knocking over that noble obelisk..

It isn't a "Ponzi Scheme". It is more like Check Kiting where every generation serves as a new bank. The problem with clichés is that Check Kiting is a much larger problem.

 

[Flash]

[

That plan covers a narrow part of Texas. It started at the start of the largest bull market in history. It had the luxury of walking away from the legacy debt of Social Security. Let's look at your low-wage worker... He makes $26,000 or nearly double the minimum wage. That may work in the government jobs, but reality is a little different.

Until you find $10+ trillion in new taxes, this is moot. Without new taxes you will not be able to pay benefits to existing retirees. Are you going to tell them to pound sand?

Just because it is narrow and only affected a few thousand people don't mean it is not valid.

What is valid is that they didn't give their money to the filthy ass Federal government and they made out better than the ones that did.

If I am reading you correctly you are arguing that we should find someway to fix Social Security.

I am arguing that we need to find a way to pay back the people that have been forced to give the filthy government their money and then put a stop to the program. It was a bad idea to have the government manage retirement. FDR was an idiot. Just admit it, pay back the ones that have paid in and then move on.

I would be willing to give up my claims to Social Security if I can be assured that my children and grandchildren are not burdened with the stupid program.

 

[JoeTheEconomist]

Nope.. The surplus was an ASSET to the General Fund. Because it was stolen. The Treasury doesn't just register "a credit to SS" --- They issue NEW DEBT and then allow SS the ability to draw on based on that NEW debt. They SPENT the same $1 twice on the backs of the taxpayer.

I'm sorry. You don't understand this. And again, I don't blame you. It's confusing to people who don't work in pension finance.

The United States Treasury does NOT issue new debt to fund SS. If you think this is true, you are mis-informed.

Right, the guy who thinks the GENERAL FUND loaning the GENERAL FUND money is an asset is telling someone they "don't understand this." Now that's classic

The general fund is the borrower. Social Security is the lender. Since the General Fund is not liable for the promises of SS, it is not the lender. The bond is an asset to SS. It is a liability to the government. You might read the 2014 Trustees Report pages 256 and 257 in which the Trustees respond to critics of Trust-Fund Accounting.

 

[Flash]

Social Security is most definitely NOT a Ponzi Scheme. All Ponzi Schemes are predicated on the sale of securities. Social Security doesn't sell anything. Ponzi Schemes are driven by the investors' desire for profit. Social Security has no investors and does not claim to make profit.

Social Security is a tax program. Ponzi Schemes are not tax programs. The taxation rate is fixed by Congress, as are the eligibility and payment features. It is true that Social Security is inter-generational, that the benefits paid out today were raised by taxes paid previously. Ponzi Schemes never last that long.

The "Ponzi Scheme" nonsense is a tired meme of talk radio. You are, of course, entirely within your rights to hate Social Security and explain why you do so. To use tendentious false analogies as evidence is mere propaganda of the lowest sort. Not that it matters much. The fringe right has about as much chance of toppling Social Security as a mutt pissing on the Washington Monument does of knocking over that noble obelisk..

Ponzi scheme is actually a great definition.

It describes a system where there is a pyramid where the last "investors" get screwed because everybody below them took the money. With a $56 trillion future liability there is a almost certain chance a lot of people are going to get screwed sometime in the future.

The "profit" in this stupid scheme is the money that was raided from the fund that was used by corrupt politicians to fund other projects that had nothing to do with the retirement plan. They paid off unions and special interest groups and got re-elected and maintained power while the people paying the payroll tax got screwed.

When you get corrupt politicians, elected by special interest groups access to a truckload of money they will find a way to spend it, no matter what it was earmarked for. We should never trust government.

The government does not need to be in the business of worrying about your retirement. That is your responsibility. If you are irresponsible then that is your problem. Do better next time.

 

[JoeTheEconomist]

[

That plan covers a narrow part of Texas. It started at the start of the largest bull market in history. It had the luxury of walking away from the legacy debt of Social Security. Let's look at your low-wage worker... He makes $26,000 or nearly double the minimum wage. That may work in the government jobs, but reality is a little different.

Until you find $10+ trillion in new taxes, this is moot. Without new taxes you will not be able to pay benefits to existing retirees. Are you going to tell them to pound sand?

Just because it is narrow and only affected a few thousand people don't mean it is not valid.

What is valid is that they didn't giver their money to the filthy ass Federal government and they made out better than the ones that did.

If I am reading you correctly you are arguing that we should find someway to fix Social Security.
.

Just because it works for a narrow segment of the population does not mean that it is valid. Until you have $10 trillion in your hand, the idea is moot.

At this point, I am arguing that we should admit that there is a problem - one that is much larger than you acknowledge.

I am arguing that we need to find a way to pay back the people that have been forced to give the filthy government their money and then put a stop to the program. It was a bad idea to have the government manage retirement. FDR was an idiot.

You realize that FDR vigorously opposed what Social Security has become, right?

Just admit it, pay back the ones that have paid in and then move on.

I would be willing to give up my claims to Social Security if I can be assured that my children and grandchildren are not burdened with the stupid program.

How will you pay those that paid in back? You are going to get people to pay in, and not get back. This is the problem. The system can pay about a dime on every dollar of promise. Your idea is to burden your children and grandchildren with a stupid solution. I know that sounds blunt, but if you are going to end it, just end it.

 

[Flash]

[Q


The general fund is the borrower. Social Security is the lender. Since the General Fund is not liable for the promises of SS, it is not the lender. The bond is an asset to SS. It is a liability to the government. You might read the 2014 Trustees Report pages 256 and 257 in which the Trustees respond to critics of Trust-Fund Accounting.

FDR promise that he will take some of your money and keep it for you and then give you a pension when you retire.

You agree to it because you an idiot.

Then the government takes the money you paid in and spends a substantial amount of it on other shit. Who would have thunk it?

At some time there is not enough money to pay off all of the people that paid into the system.

The lesson from this is that we should never trust the government. Don't give them our money. Don't be stupid.

It ain't rocket science.

 

[JoeTheEconomist]

Social Security is most definitely NOT a Ponzi Scheme. All Ponzi Schemes are predicated on the sale of securities. Social Security doesn't sell anything. Ponzi Schemes are driven by the investors' desire for profit. Social Security has no investors and does not claim to make profit.

Social Security is a tax program. Ponzi Schemes are not tax programs. The taxation rate is fixed by Congress, as are the eligibility and payment features. It is true that Social Security is inter-generational, that the benefits paid out today were raised by taxes paid previously. Ponzi Schemes never last that long.

The "Ponzi Scheme" nonsense is a tired meme of talk radio. You are, of course, entirely within your rights to hate Social Security and explain why you do so. To use tendentious false analogies as evidence is mere propaganda of the lowest sort. Not that it matters much. The fringe right has about as much chance of toppling Social Security as a mutt pissing on the Washington Monument does of knocking over that noble obelisk..

Ponzi scheme is actually a great definition.

It describes a system where there is a pyramid where the last "investors" get screwed because everybody below them took the money. With a $56 trillion future liability there is a almost certain chance a lot of people are going to get screwed sometime in the future.

The "profit" in this stupid scheme is the money that was raided from the fund that was used by corrupt politicians to fund other projects that had nothing to do with the retirement plan. They paid off unions and special interest groups and got re-elected and maintained power while the people paying the payroll tax got screwed.

When you get corrupt politicians, elected by special interest groups access to a truckload of money they will find a way to spend it, no matter what it was earmarked for. We should never trust government.

The government does not need to be in the business of worrying about your retirement. That is your responsibility. If you are irresponsible then that is your problem. Do better next time.

Why do you believe any of this? Where does the 56 trillion come from? It isn't the Trustees. There is virtually no money in the system for politicians to take. The system has collected about 17 trillion in total revenue. It has paid out 15 trillion or so in benefits. Another 1.5 trillion has been dedicated to financing the interest cost. So where is the money to pay off unions and special interest groups.

Check kiting is much closer. We take money from workers in exchange for the promise of future benefits. We pay those benefits by writing another check to another set of workers. And so forth and so on until boom.

 

[JoeTheEconomist]

[Q


The general fund is the borrower. Social Security is the lender. Since the General Fund is not liable for the promises of SS, it is not the lender. The bond is an asset to SS. It is a liability to the government. You might read the 2014 Trustees Report pages 256 and 257 in which the Trustees respond to critics of Trust-Fund Accounting.

FDR promise that he will take some of your money and keep it for you and then give you a pension when you retire.

You agree to it because you an idiot.

Then the government takes the money you paid in and spends a substantial amount of it on other shit. Who would have thunk it?

At some time there is not enough money to pay off all of the people that paid into the system.

The lesson from this is that we should never trust the government. Don't give them our money. Don't be stupid.

It ain't rocket science.

You are aware that Congress waived all of the tax increases that FDR wanted which were intended to pay for the system, right? So there wasn't ever a take your money. Congress just made it a benefit system at the expense of your kids program.