Posted on 03/05/2011 10:43:14 AM PST by rabscuttle385
WASHINGTON (Reuters) - While Congress brawls over how to shrink a $1.6 trillion budget deficit this year, an even tougher battle has begun over cutting popular Social Security retirement benefits to achieve long-term savings.
It's unclear whether Congress will be able to agree on how to reform the massive government pension program, which has provided a social safety net for the elderly since 1935.
That in part will depend on whether President Barack Obama throws his weight behind a reform effort that politicians of all stripes fear could be full of political risks. While the president has invited a conversation on Social Security reform, so far he has not offered specific proposals.
Undercutting Social Security reform efforts is the fact that if left alone, the retirement benefits will keep flowing unimpeded until 2037, according to government estimates last year.
Social Security has been generating surplus tax revenues for years. But with the surplus vanishing because of an onslaught of new retirees and because the surplus has been used to finance tax breaks and other government programs, the Social Security now has to be paid back.
(Excerpt) Read more at reuters.com ...
You know I knew in my head that this was going on but had never actually seen instances of it. Yesterday I actually started looking around.
Our social security dollars are being used to fund all kinds of crap programs!
Duh. And people wonder why it's in such a sorry shape.
True once they raped the so-called “SS trust fund”.. big government was inevitable.. locked in.. and running on automatic control.. Some might say once they enacted the federal government controlled social security system the end was in sight.. A private system might have worked.. but a federal one was toxic to the treasury..
IIRC the money was used by LBJ to fund his war on poverty and all of the socialist feel good programs ( and being the worlds policemen) that the politicians (mostly dems) could think of to help them get reelected. The old age savings of hundreds of millions of people were handed out willy-nilly until it was all gone. And now they are wondering how to cover the expenditures for which the money was originally intended.
Are all these monies coming out of Social Security collections? If not why are they part of the Social Security laws?
http://www.ssa.gov/OP_Home/ssact/title19/1900.htm
http://www.ssa.gov/OP_Home/ssact/title04/0400.htm
At one time, Social Security was completely separate from the rest of the government budget.
But when the finances of Social Security were merged into the rest of the federal budget, the surpluses which were supposed to be set aside to help pay the baby boomers Social Security benefits disappeared.
On paper, Social Security if a separate entity, would have had surpluses for many years. Instead, the surplus attributable to Social Security only masked the true size of the overall federal deficit.
And this has happened under both Republican and Democrat presidents.
People have known for well over 20 years that a moment of truth was coming, and we’re getting closer to that point all the time, regarding Social Security finances.
Speaking of retirement pay, I hear that some in government are eyeing the trillions in 401K and IRA accounts. Since people don’t “need” this money yet, as this represents people’s retirement savings, some in government want to “borrow” these funds. I hope to God that doesn’t happen.
It should go broke entirely inMay. I am due to get my first pittance.
Congress and the White House has wasted our money and all they want is more.
One of the South American countries has already "nationalized" all retirement funds.
I have heard some websites speculate that if we could get all of the retirement funds from unions, personal retirement accounts, and social security funds and then adjust the retirement age for current lifespans, we could solve this "problem" and old people would not have to die in the streets.
It is my understanding that to use Social Security surplus funds to finance general obligation purposes, the Treasury Department issues special bonds in the amount borrowed. These bonds are therefore legal debt obligations. Granted, this debt to the Social Security fund has been accumulating for many years and to repay it, funds would have to be taken from current non Social Security revenue. The argument seems to be that the government can’t afford to repay it’s debt to the Social Security fund therefore retirement benefits must be delayed or reduced.
In addition to borrowing from the Social Security fund, the government has financed spending by borrowing from many other sources, including Savings bonds sold to individuals, and Treasury bonds sold to individuals, businesses, and governments such as Japan and China. My question is why would the holder of Treasury Bonds, Savings Bonds or any other type debt have a higher priority for repayment than the Social Security Bonds? Are we going to place a higher priority on repayment of money borrowed from China than we are to repayment of money borrowed from American workers? If our debt to China has a higher priority than Social Security bond debt, does it also have a higher priority than US Savings Bond debt held by millions of Americans or Treasury Bond debt held by many private pension plans including many funds managing 401K plans? When we contemplate dishonoring one category of debt versus another, we open a real can of worms.
Viet Nam Vets know that LBJ implemented the use of surplus Social Security funds to fund the Viet Nam War!
As soon as the Viet Nam War is ended we can begin to refill the SSI slush bucket!
Sarc Off
So are all the programs in post #6 & 7 financed that way? If so Social Security is nothing but one big federal welfare program.
They should ALL be strung up imo.
On Mondays, Wednesdays and Fridays I think that it is likely that government will soon require tax deferred accounts put a small percentage (maybe 10%) in guaranteed government bonds to provide a "safe" investment. Of course this will go up as time goes by to gradually boil the frog. If they were taken all at once then people with a having their entire retirement stolen would be rioting in the streets, while just nabbing 10% temporarily would just cause some grumbling.
On Tuesdays, Thursdays and Saturdays I think that the confiscation rumors are put out by the government to get people to reduce their 401k and IRA contributions so their current income and taxes are increased - everyone you convince to hold onto their $16,500 maximum 401k savings means about $4,000 in extra income tax.
I am on SS disability and I advocate a gradual reset of the retirement age and a means testing to qualify.
“... social safety net for the elderly ...”
That’s ALL it was intended to be, a last-ditch, keep-from-starving safety net for those seniors who (ahem) didn’t plan ahead for retirement.
Social Security now is the nation’s biggest giveaway program. When those who never contributed can collect ... bad news!
So not taking someone's money is a "government program"?
I agree we have many unwise and unnecessary programs. The question I was posing, however, was simply whether we as a nation have an obligation to honor all debt incurred by our elected government or whether we will treat debt differently based on who it is owed to. Do we have the same obligation to repay the money borrowed from the Social Security fund as we do the money borrowed from the government of China. If and when we can’t repay everyone, who gets paid and who gets stiffed.
great thoughts, but at -$1,500,000,000,000.00 annually, does anybody think their gonna see the money ???
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