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Social Security and Medicare Projections: 2009 (America's Bankruptcy - $107 Trillion Debt)
National Center for Policy Analysis ^ | June 11, 2009 | Pamela Villarreal

Posted on 03/20/2010 4:03:03 PM PDT by Conservative Coulter Fan

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To: Conservative Coulter Fan

Social Security: “Here It Comes”

http://market-ticker.org/archives/2080-Social-Security-Here-It-Comes.html
This year, for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes — nearly $29 billion more.

In a world where we talk about trillions, this doesn’t sound like much. But it’s not the amount that’s the problem - it’s the direction.


61 posted on 03/21/2010 12:18:35 PM PDT by WOBBLY BOB (ACORN:American Corruption for Obama Right Now)
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To: se_ohio_young_conservative

At least they throw great parties down in Rio De Janerio!


62 posted on 03/21/2010 12:18:43 PM PDT by MinorityRepublican
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To: Will88
Point #1 - I believe I've made it clear that the outlook is horrible, but I adhere to my principles and do what I can to oppose it. That doesn't mean I live in a "fantasy world," because I reject your corrupt ideals and your incorporation of aspect of socialism into your political outlook. You can lecture me all you want to about "modern" ways of thinking, a familiar tract among the Left, especially the "evolving" Constitution arguments. This is no novel invention on your part. We've had a nation without Social Security and we can once again have a nation without Social Security, because it is ridiculous to just accept your fantasies of doom. People can open a savings account and become a millionaire by the time they retire, and that alone shows a modest means to achieve comfortable, secure retirement without the Government. As for so-called "contributions," the Government never gave anyone a choice, payroll taxes are compulsory, but if it makes you feel any better the Supreme Court ruled in 1960 that no one has any "property rights" to their so-called contributions.

Point #2 - Your claim that of millions of eldery people wailing in the streets and affluent people needing 17 walls around their house is the very stuff of fantasy, sir. Only the very poorest, uneducated people would depend solely on Social Security or for the most part. The dependency fostered by the Government destroys genuine altruism and civic responsibility to help such people, it further enlarges the class of dependent people destroying the incentive and responsibility of people to manage their lives, and I have no doubt that there would be many shrill voices screaming at any attempt to dismantle Social Security.

Point #3 - Once again, quit aping the Bill O'Reilly mantra. Only political relativism leads people to pretend those of us on the Right are any way similar or like those on the opposite political spectrum. Your ideals are most certainly corrupted when you believe the Government must maintain socialistic aspects of Government or otherwise the world is doomed. I'd hate to even bother examining your views on Capitalism.

Point #4 - I never used a straw man argument in the way you suggest. You claimed that the views expressed by myself or others would cause people to rush to Obama & the Democrats implying that these manifestly socialist aspects of America's federal government are popular. I made the logical point that popularity alone isn't justification or reason for me to abandon my principles. I wonder what you'd say of those who opposed Lyndon Johnson's "Great Society" programs. As for my comment about Ward Churchill or the leftist media, I made the point that given the reality in schools, campuses, and media (among many other areas) that our side is losing and thus far has lost the debate. It does, however, have everything to do with why we have Social Security and why attempts to reform or curtail have gone nowhere.

Point #5 - I mtend to agree with your definition of Socialism, but you fail to recognize the different types of Socialism. Fabian Socialism, named after the Roman General Fabius Cunctator. favored gradualism. Social safety nets are one of the gradual steps toward achieving that end. Fabians founded the Labour Party in Britain. I was reading the other day about the head of the British Conservative Party that the government sould subsidize fresh fruits for people and provide universal gym membership. Not a straw man, just saying. It was like the quote I gave you from Reagan about Thomas saying that America would enact the socialist agenda under the banner of liberalism.
63 posted on 03/21/2010 12:52:16 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: WOBBLY BOB

I really am amused how people throw around numbers in the billions as if it is monopoly money. Maybe that is not the best description, but you understand my point. Now we’re throwing around figures like $1,000,000,000,000 and some treat amounts like this as if it were mere “peanuts.”


64 posted on 03/21/2010 12:56:31 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: Will88

Why don’t you share your insights? How is a $14 trillion economy going to cope with a debt of $107 trillion?


65 posted on 03/21/2010 1:04:47 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: Conservative Coulter Fan

Stay in your little fantasy world and don’t look out because things are getting worse instead of better.

And screw you and your idiotic notion that you have some moral standing to judge anyone else’s ideals. You clearly don’t.

And you are very foolish if you think that even a sizable majority of any society is going to open savings accounts and provide for their future retirement. News item: many people don’t earn enough to live and save any significant amount, and the good paying jobs just aren’t around for everyone. Another fantasy of yours, and yes in a nation the size of the USA, there’d be millions of elderly with no income or means of support if there were no program.

And I’m well aware of other strains of socialism, but they have really just evolved and been named after the fact, and they still are not real, basic socialism where government owns the means of production and there is no private property. We could also Fabian capitalism, or all sorts of hybrids with all sorts of names.

In your point #4, yep, if Republicans started talking about eliminating SS and and the safety net, you’d better believe many would turn around today and head back toward Obama. Many opposing Obama today are doing so because of his cuts in Medicare to prop up his new Obamacare programs.

You’re just one more purist out of touch with the reality of what is possible in the real world, and what is simply fantasy. I think we should have a basic safety net for working citizens, and a basic SS and medicare system, and some reforms will have to be made as most everyone knows. We won’t ever be much leaner than that, and will be lucky if we can hold it there.


66 posted on 03/21/2010 1:19:28 PM PDT by Will88
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To: Conservative Coulter Fan
Why don’t you share your insights? How is a $14 trillion economy going to cope with a debt of $107 trillion?

First, no one has yet pointed out how many years into the future that $107 of unfunded liabilities covers. That matters, and it's odd that they don't give that information anywhere.

Raise the retirement age, as often as average left expectancy increases.

But the only way the US will return to a healthy financial situation will be to develop economic and trade policies that create a growing economy and jobs, and enough jobs to reduce our real unemployment (17%), and enough jobs to begin seriously removing able bodied people from welfare and various other government programs. Enforce the border and stop allowing illegal aliens to undercut US wages. Allow wages to rise to the supply and demand level of legal, US citizen labor.

In a nutshell, large numbers of Americans must move from unemployment, and welfare into jobs that pay enough in pay and benefits to enable them to be self-sufficient, including for medical care, i.e., also reduce the cost of government support progams by a few hundred billion annually (EITC alone alone is now $60 billion, plus all the welfare and medicaid, and other support for low wage earners.

If that can't happen, the demand for government programs to make up the difference will always be there, and the votes will always be there.

The only hope: more people working and self-sufficient, and big reductions in the need for government support programs for working age citizens and legal residents.

67 posted on 03/21/2010 1:32:36 PM PDT by Will88
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To: Will88
Look, I’ve lost my patience with you, Sir! Your entire argument is that I “live ina fantasy world,” because I don’t agree with you, and amazingly you live in the fantasy world that pretends “Social Security is fine” despite having an unfunded liability of $13 trillion, having a shortfall of $29 billion this year, and facing a crushing tsunami of 80 million baby boomers. You’ve never rebutted, and in many cases skipped over, my arguments against Social Security including the constitutionality of it and you’ve defied reason itself by ignoring my repeated alternative to the government “mandated retirement,” which is simply opening a savings account and retiring a millionaire. You’ve held up your nose to the proposition that people, not the Government, are responsible for their retirement. Like my argument about alternative types of saving and investing as opposed to Government mandated retirement, there are genuine altruistic and civic ways of helping those in need. This is the very reason I concluded you have corrupted ideals and this persistent intellectual dishonesty is not going to win you the debate. I will judge you, by your very words and course throughout the debate. That’s Merit 101!

Yes, I must be foolish to believe that people could actually open up a savings account, put in less than the Government would take for Social Security, and use the power of compound interest to have a better retirement than they could through the Government while maintaining absolute control and responsibility of their money and drawing their money at the age they decide. How foolish of me to think Americans, or a majority of them, would be responsible and behave like grownup adults! The only thing your argument can use is that Americans are upside with credit cards, mortgages, car & loans, and so forth. Of course, you don’t have to live within your means, or responsibly budget your household, because we have a Government ready to provide your every need and bailout any failure. Hey, just look at what government-run schools are turning out and looking at the performance of America in an area like education and you’ll see just why that is. As for the “millions dying in the streets,” those are just the product of lazy, fear mongering minds that refuse to consider individuals taking responsibility for their lives and communities or simply, in this case, their retirement.

As for the types of Socialism, you completely evade my entire point and again miss the fact that Fabian Socialism was founded in the late 1800s in Great Britain, rejecting Marx’s call for revolution instead relying on a Roman general’s strategy for defeating Hannibal, which was avoiding major clashes and gradually wearing down resistance. Fabian Socialism was the basis for the Great Society programs enacted by Lyndon Johnson. It is ludicrous for you to suggest there is a “Fabian” capitalism. That’s fantasy. That doesn’t exist. That’s another relativistic view point, but you are proving to be quite post-modern aren’t you?

As for my point #4, you made a false claim about what I said in response to your assertion that eliminating Social Security would drive people to the Democrats. At this time, with government-run schools, colleges, universities, media, and so forth – absolutely. Not to mention corrupted conservatives like yourself that not only fail to articulate or think about the need to dismantle it, you openly support it and propagandize for it. The consequence is freedom and truth. You think you’re winning, but actually you are gradually losing more and more to the other side while co-opting more of their agenda. Actually, cuts in Medicare are a good thing. That program alone has 85.6 Trillion in debt. That’s not why I’m opposed to Obama’s health care bill either.

Furthermore, I’m very in touch with reality. I understand the political reality. You’re problem seems to be that I’m on operating on a sound, principled basis as opposed to a corrupted or incoherent foundation. You can play the Republican vs. Democrat game and cheer on your favorite team, but I have a broader view coupled with strong convictions. I don’t choose to ignore the reality of our unfunded liabilities and the unsustainable welfare state we have today. Perhaps you should look at my thread on 2009 index on dependency. When you decide to lie, or ignore, you are part of the very reason why will never hope for more than mediocre “reform,” but I regret to inform you that the unfunded liabilities have enough debt to destroy this nation.
68 posted on 03/21/2010 2:15:34 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: Will88
Okay, you seem to be forgetting that 80 million Americans will began retiring and won’t be part of our work force. At a rate of 10,000 per day, drawing on Social Security and Medicare, that’s where you start accumulating debt to that magnitude. Not to mention that National Debt we currently have or the annual trillion dollar deficits. The solution of creating more jobs fails to take into account the severity of the problem and the amount of debt. As a side note, you oppose illegal immigration from Mexico, but I suppose that means you live in a fantasy world if you actually believe anyone in this country is going to stop it or at least the politicians in Washington D.C. or the states that border Mexico. I live in North Carolina and I can take you to neighborhoods populated by non-English speaking illegal immigrants from Mexico, the Mexican stores they frequent, and so forth. Just because I fiercely stand against it, or Social Security, doesn’t mean I don’t understand the political reality in my own state.

The only hope is returning to the Government to its constitutionally mandated size and scope, and Ron Paul was the only one even claim close although I’m not really a Paul backer necessarily. Robert Fischer, the CEO of the Federal Reserve in Dallas, said you’d have to cut discretionary spending by 97% and that in effect means the entire budget passed by Congress – no defense spending, no education spending, nothing! You’d basically have to clear out D.C. He also said you’d have to increase revenue 68 percent and there is no telling how high individual or corporate rates would have to go in order to achieve that level of increase in revenue. We can’t borrow from ourselves as we did in WWII due to credit card debt, mortgages, loans, and the poor saving habits of Americans today. We can’t count on foreign countries to keep buying our debt; especially at the rate we are accumulating it. We’re on the way to hyperinflation and inflation is the worst tax increase. So, we’re left with the bankruptcy of the United States.
69 posted on 03/21/2010 2:33:23 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: Conservative Coulter Fan
As for the “millions dying in the streets,” those are just the product of lazy, fear mongering minds that refuse to consider individuals taking responsibility for their lives and communities or simply, in this case, their retirement.

More nonsense. You're arguing with yourself. I never said anything about "millions dying in the streets". I said, several times, millions of elderly with no income, or means of support. You made up that "dying in the streets" phrase for effect.

And all your blather about people opening savings accounts. Sure, most would, but with several million reaching retirement age annually, there would still be millions of elderly who had not saved, or had lost their savings, and therefore, millions of elderly with no income.

And, again, you are far from being anyone to make judgments about anyone's ideals.

And you keep throwing out these unfunded liability numbers, but this article doesn't tell how many years they go out, and how many years there are to make adjustments. A very big omission by the author. - But the only solution is an improved economy that produces more decent paying jobs, and a big movement of people from the unemployed and government supported categories to the employed category, plus adjustments in retirement age, maybe some means testing, etc.

Don't care about your obsession with the different types of socialism. It doesn't change whatever mix of capitalism and socialism any given nation is today.

70 posted on 03/21/2010 2:48:15 PM PDT by Will88
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To: Conservative Coulter Fan
Okay, you seem to be forgetting that 80 million Americans will began retiring and won’t be part of our work force. At a rate of 10,000 per day, drawing on Social Security and Medicare, that’s where you start accumulating debt to that magnitude. Not to mention that National Debt we currently have or the annual trillion dollar deficits.

Over how many years will those 80 million be retiring? That's a problem with this entire article and discussion. The article doesn't give the time span of future years it is considering.

Everything you're talking about there should be in the "unfunded liability" figures the article gives.

The Obama deficits will ruin this nation by themselves if something isn't done soon. He definitely needs to go in 2012, and some corrections in the deficit started (even after 2010 if Republicans win enough seats in Congress). But Obama deficits, and all deficits will have to be addressed with a better economy and moving people off government support to decent jobs.

We can start enforcing immigration laws or continue to allow the huge financial drain illegals cause. And they are a cost, not just because they access some government services, but also they drive down wages of citizens, and take jobs citizens had done for many years, and put some citizens on various government support programs.

No fantasy there. We'll either enforce the law or continue to pay a steep financial price for the illegals.

But if we can't fix it with an improve economy and decent jobs for US citizens, and adjustments to SS and Medicare for the future, then it can't be fixed.

71 posted on 03/21/2010 3:09:01 PM PDT by Will88
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To: Will88
I’m not arguing with myself, I’ve been arguing with you all along. You simply choose to pretend there will be “millions of elderly with no income, or means of support,” which implies millions of people in America dying in the streets because you say there will be nothing for them. The best argument you have is fear mongering, which is why you have ducked every argument I’ve made against Social Security or the need for any Government mandated retirement. As for people being grownup adults, taking responsibility for their retirement by saving, which is one simple alternative to Social Security, surely the world hasn’t gone so completely mad it that people don’t have to be mature enough to sacrifice living beyond their means and doing without Cable Television (if need be) in order to save a smaller portion of their income (than the government would take) in order to prepare for their retirement. Given your notion that we people bear no responsibility for their lives, or suffer consequences for bad choices, I will most certainly make an informed judgment about your corrupted ideals seeing that you give a portrayal of a conservative while being devoid of any authentic conservative philosophy.

As for the numbers, which come from Robert Fischer of the Fed, or the trustees of the entitlement programs themselves, or the former comptroller David Walker, I have repeatedly tried explaining the demographic sweep of 80 million baby boomers over the next two decades. Levels of dependency on the government are increasing and you talk the very stuff of fantasy when it comes to reducing dependency by putting people in jobs while we have a President that has essentially undone the Welfare Reform of 96 and increasing dependency. Further, since you like pretending so much, how likely do you think it’ll be that the Republicans and Democrats will raise the age of retirement to 70? Your argument is incoherent. The only reason I brought up Fabian Socialism was the disprove that narrower definition of Socialism, which is an accurate definition, by showing that safety nets and other political objectives may not fall under the auspices of “government ownership,” but are still socialistic. I suppose you’ll call be radical or something for believing we don’t need a mix of socialism and capitalism.
72 posted on 03/21/2010 3:10:35 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: Will88

This was an abstract, for the full report, you have to go to the source and download the PDF, which was far too large to post in full. The figure with respect o the 80 million baby boomers can be found in the reports by the trustee of Social Security and Medicare, in David Walker’s book (Comeback America), at other sources on this topic at the Heritage Foundation (see my thread on the 2009 Index of Dependency posted yesterday, the Cato Institute, or a variety of other sources. Why don’t you inform yourself before taking positions? And on deficits, we aren’t going to simply solve them with better jobs we can only curtail them with fiscal responsibility to the level we saw when the Republicans came to power in 94, even though they were not flawless. There is no model, or even suggestion, of how we are going to create jobs or end dependency (when Obama ended Welfare Reform and is increasing dependency) and you don’t seem to understand that we’d have to reduce spending by 97% or increase revenue by 68 percent. This is the stuff of fantasy.

You don’t have to make arguments against illegal immigration or the enforcement of our laws. I’m totally against the invasion, but the reality is that neither the Republicans nor Democrats…or state….are going to do anything to seriously end it or curtail it. Obama is attempting to legalize them. So yes, this is fantasy to believe that after 8 years of Bush (and we know he supported illegal immigration) and Obama – are you going to tell me that anyone is going to enforce the laws. I see them all over the county I live in and the surrounding counties.


73 posted on 03/21/2010 3:22:29 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: Conservative Coulter Fan

I’m ending this because you have your fantasies and nothing can dissuade you from them.

1. If you want to believe that the US could rely on its citizens to voluntarily provide for their own retirement, and that a high enough percentage would, then believe it.

2. If you want to believe that would not be millions who failed to save, or lost or squandered their savings, or ended up with no source of income at retirement, then believe it.

3. And you don’t understand the numbers you are looking at. You have no idea how many years that $107 trillion in unfunded liabilities represent, or how many years over which the 80 million boomers (if that’s a valid number for boomers) are to retire. Some of those stats go out 70 years, and it’s possible $107 trillion goes out until 2080 also. A definite time frame is needed to better consider what the article presented.

4. And, believe it or not, if we cannot correct it with a stronger economy, more decent jobs, many fewer working age people receiving government support, and with adjustments to SS and Medicare (eligibility age, means testing, etc.), then it can’t be fixed at all.


74 posted on 03/21/2010 3:43:44 PM PDT by Will88
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To: Conservative Coulter Fan
This was an abstract, for the full report, you have to go to the source and download the PDF, which was far too large to post in full.

I looked at one PDF and it still didn't provide a definite time frame for the unfunded liabilities. It gave a vague definition about what will be paid in and paid out over the life of the present and future beneficiaries. That might mean the 70 years, which is probably close to the expected benefit period of the youngest future beneficiaries now paying into SS.

75 posted on 03/21/2010 3:48:45 PM PDT by Will88
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To: Will88
Well, you've shown youself quite capable of indulging in fantasy: "Social Security is fine" would be a prime example. Another would be your idea that we can eliminate $107 trillion in debt by creating more jobs and reducing dependency on Government (devoid of any detail or explanation of how that will be done) while Barack Obama has undone Welfare Reform and increased dependency.

Response to #1 - I never made any ststement do the effect of how many people would provide for themselves (including retirement). I said it is the responsiblity of grownup adults in a free society to provide for their retirement. They could and they should...

Response to #2 - There will always be people that make poor choices or behave recklessly, but that doesn't mean we need the Government to mandate retirement for the whole country. It would require people at a local level to address the question. I don't buy into apocalyptic notions of doom due to people having to meet the requirement of adult, assume responsbility for their life, and suffer consequences for bad or reckless decisions and lifestyles.

Response #3 - Robert Fischer, David Walker, and others have been citing these figures regarding the debt to the tune of $107 trillion and they are most urgent in the need to address the staggering figure although it may be too late. As for the 80 million baby boomers, I posted a thread that I'll mention for the third time to you - the 2009 index on dependency (source: Heritage Foundation), which makes it clear that over the next 20 years they will be retiring at 10,000 per day. This number is the very reason people started talking about "reforming" Social Security almost 10 years ago. I cannot believe you can brush aside that figure....that's Seven times the size of the U.S. economy and TEN times the size of our national debt.

Response to #4 - I already believe it will not be fixed, but I pointed out that it would take measures like Fischer suggested such as cutting discreationary spending by 97% effectively ending almost all spending in Washington D.C. or finding a way to increase government revenue 68% and that would most certainly kill the economy as we know it. You say more jobs - who's going to do it and how? You say reduce dependency on welfare - how? Obama removed the reform of 96 and increased it. You say adjust Social Security and Medicare with two vague notions: raise the age and make it means-tested. Who is going to raise the age requirement for either? Who is going to make Social Security means-tested? You make Social Security means-tested...that means a lot of people who get nothing, but are forced to pay in and raising the age means you have to wait even longer on that check. Why don't you suggest we end prescription drug coverage or set a date to ween off to end these programs? That's not much more unrealistic that the prospects of your proposal.
76 posted on 03/21/2010 4:35:28 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: Will88
"Now, fast forward 70 or so years and ask this question: What is the mathematical predicament of Social Security today? Answer: The amount of money the Social Security system would need today to cover all unfunded liabilities from now on—what fiscal economists call the “infinite horizon discounted value” of what has already been promised recipients but has no funding mechanism currently in place—is $13.6 trillion, an amount slightly less than the annual gross domestic product of the United States.

...

Medicare was a pay-as-you-go program from the very beginning, despite warnings from some congressional leaders—Wilbur Mills was the most credible of them before he succumbed to the pay-as-you-go wiles of Fanne Foxe, the Argentine Firecracker—who foresaw some of the long-term fiscal issues such a financing system could pose. Unfortunately, they were right.

...

Please sit tight while I walk you through the math of Medicare. As you may know, the program comes in three parts: Medicare Part A, which covers hospital stays; Medicare B, which covers doctor visits; and Medicare D, the drug benefit that went into effect just 29 months ago. The infinite-horizon present discounted value of the unfunded liability for Medicare A is $34.4 trillion. The unfunded liability of Medicare B is an additional $34 trillion. The shortfall for Medicare D adds another $17.2 trillion. The total? If you wanted to cover the unfunded liability of all three programs today, you would be stuck with an $85.6 trillion bill. That is more than six times as large as the bill for Social Security. It is more than six times the annual output of the entire U.S. economy.

...

Why is the Medicare figure so large? There is a mix of reasons, really. In part, it is due to the same birthrate and life-expectancy issues that affect Social Security. In part, it is due to ever-costlier advances in medical technology and the willingness of Medicare to pay for them. And in part, it is due to expanded benefits—the new drug benefit program’s unfunded liability is by itself one-third greater than all of Social Security’s.

...

Add together the unfunded liabilities from Medicare and Social Security, and it comes to $99.2 trillion over the infinite horizon. Traditional Medicare composes about 69 percent, the new drug benefit roughly 17 percent and Social Security the remaining 14 percent.

...

Let’s say you and I and Bruce Ericson and every U.S. citizen who is alive today decided to fully address this unfunded liability through lump-sum payments from our own pocketbooks, so that all of us and all future generations could be secure in the knowledge that we and they would receive promised benefits in perpetuity. How much would we have to pay if we split the tab? Again, the math is painful. With a total population of 304 million, from infants to the elderly, the per-person payment to the federal treasury would come to $330,000. This comes to $1.3 million per family of four—over 25 times the average household’s income.

...

No combination of tax hikes and spending cuts, though, will change the total burden borne by current and future generations. For the existing unfunded liabilities to be covered in the end, someone must pay $99.2 trillion more or receive $99.2 trillion less than they have been currently promised. This is a cold, hard fact. The decision we must make is whether to shoulder a substantial portion of that burden today or compel future generations to bear its full weight.

...

Purging rampant inflation and a debased currency requires administering a harsh medicine. We have been there, and we know the cure that was wrought by the FOMC under Paul Volcker. Even the perception that the Fed is pursuing a cheap-money strategy to accommodate fiscal burdens, should it take root, is a paramount risk to the long-term welfare of the U.S. economy. The Federal Reserve will never let this happen. It is not an option. Ever. Period.

...

Of late, we have heard many complaints about the weakness of the dollar against the euro and other currencies. It was recently argued in the op-ed pages of the Financial Times [3] that one reason for the demise of the British pound was the need to liquidate England’s international reserves to pay off the costs of the Great Wars. In the end, the pound, it was essentially argued, was sunk by the kaiser’s army and Hitler’s bombs. Right now, we—you and I—are launching fiscal bombs against ourselves. You have it in your power as the electors of our fiscal authorities to prevent this destruction. Please do so. "
--Source
77 posted on 03/21/2010 5:00:48 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: Conservative Coulter Fan

You don’t know the difference between “debt” and an “unfunded liability”. You use the two interchangeably, but they are not the same.

A debt is specific principal, or accounts payable amount, the gov’t’s bond debt, etc., due now or in the future, a home mortgage, what a retailer owes a wholesaler, etc.

An unfunded liability is generally an estimate of amounts that must be paid out in the future, such as a company’s estimated future pension liability, or the government’s estimated SS and Medicare liability.

The debt is generally fixed, but the unfunded liability can change for many reasons. The company or gov’t might fund it at a faster or slower rate, or the estimated number of future retirees could increase or decrease. But it is not fixed.

And, even though it’s not said explicitly, the $107 trillion seems to go through 2080, or for 70 years. So there is time to make corrections and avoid financial Armageddon, at least due to this situation.

The biggest short term problem is Obama and his years of trillion+ dollar annual deficits. And I stick with what I’ve said previously concerning how the $107 trillion in unfunded liabilities will have to be handled over the coming decades.

And yes, SS is fine for now with its $2.5 trillion surplus. It’s the general financial soundness of the US government that would be the first concern, and whether it will honor its bonds held by SS as is needed by SS (as well as all its other debts). (If necessary, I expect the Fed would just create some money to make sure SS keeps flowing.)

Medicare needs serious adjustments, but there is time work o that.

I’ve confident now that this article involves 70 years of unfunded liabilities, so it’s not as dire as it seemed. The author should have been more clear on what time span he was discussing.

So, I’m finished and still sticking with what I’ve said.


78 posted on 03/21/2010 5:16:04 PM PDT by Will88
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To: Will88

Quite frankly I cannot continue to hold a discussion with someone who’s so boneheaded and misinformed. You have frequently demonstrated a complete lack of information while continuing to pontificate on the topic. Social Security, Medicare, and Medicaid fall under mandatory federal spending and by law that money is spent, without Congress. That’s money flowing out of Washington D.C. on autopilot. Rather than arguing over semantics, debt is what we’ve already accumulated and the unfunded liabilities are what we can most certainly expect to payout in the future according to the Social Security trustees, Medicare Trustee, Richard Fischer at the Fed, David Walker of the GAO, liberal and conservative think tanks, and a variety of other sources. Plenty of experts seem to think it is most definitely an economic Armageddon, but we have the wisdom of Will, the contorted conservative who knows better, because he has an ideological attachment to the Welfare State and the idea of safety nets. The problems for Social Security have already projections (people projected 2012 or 2016), which is why Social Security already has a shortfall of $29 billion. How you can ignore 80 million people retiring at a rate of around 10,000 per day isn’t going to be the cause of the calamity? See, you deal in fantasy! You are clearly ignorant when CPAs are telling you must face this massive problem now, but then we have Joe Blow telling us we can just kick back for a couple more decades. This type of complacency is astounding; it’s fiscally irresponsible, and above all negligent. It probably only a more basic issues boils down to the fact that you lack any concern and seem to have a proclivity for arguing for the sake of argument. I love those pearls of wisdom about how Medicare has serious problems, but we have time to work on that too. Give me a break! You have to be financially and economically challenged to think this way. So you just finish, ignore the problems, avoid debating Social Security, turn responsibility upside down, mock your own political philosophy, unwittingly propagandize for collectivism, balk at figures, skip sources, flout warnings, and assert your own assured expert advice that everything is fine while people in the real world address the problem.


79 posted on 03/21/2010 5:45:00 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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