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Posted on 05/14/2011 9:05:39 AM PDT by Slyscribe
Social Security and Medicare — the elephants sidelined in the latest budget talk — took center stage Friday as trustees' annual reports showed both programs' finances have deteriorated.
Social Security's trust fund — which gives it carte blanche to spend beyond the government's means until its IOUs from the Treasury Department run out — is now seen running empty in 2036, a year earlier.
(Excerpt) Read more at investors.com ...
.... sarc
I think this is meaningless since we pay no interest on this debt - other than, perhaps, to just add some nominal interest to the number stored on some computer in D.C. We don’t write checks to anybody for any interest due the SS fund. No money leaves the Treasury
Correct me if I’m wrong about this.
Those who care about our country know the Trust Fund is a bushel basket of IOUs signed by Obama and the last 5 presidents. The IOUs are redeemed from current revenue and more borrowing by the Feds. Pretty soon, these entitlement programs will suck up all current revenue and borrowing, leaving nothing for defense, internal improvements and the rest of what government is supposed to do under the Constitution. The Paul Ryan Budget Plan or something close to it is absolutely necessary if the USA is to survive.
There is no damn fund! Every cent of the money collected in FICA payments each year is used to pay retirees, SSI, etc. and anything left over is spent by the damned government.
This year, outlays for SS payments to retirees and SSI outstripped FICA payments from workers - leaving nothing for government to piss away. Whatever 'fund' there is a paper accounting myth that was spent long ago. No fund, no money, no hope, period.
Back in the aulden days, it was ballooning military expenditures that ruined empires and Great Powers. That's the ground the lefties are standing on when they blame the current deficits on wars and the military.
Now, it's entitlements. A prediction: in a century or two, entitlement programs will have the same bad name that military expenditures had in the classical-liberal era.
This would be true if we paid off our debt as it reached maturity. Instead, we need to 'roll' our debt - meaning we borrow to cover today's shortfalls and pay off the maturing bonds .... with new debt. The new debt has an interest cost associated with it. When it matures, we will sell even more debt to cover both the original bond and the interest due. We have not 'paid off' any debt in the past 50 years - what we have done is borrow even more to roll it forward. So, yes, there is significant interest expense. Rolling forward 2 to 5 year issues with interest of 2.5 to 4.5 percent adds up really quickly when you are talking about $5 trillion in obligations.
Amen! The fact that financial press uses the term "Social Security Trust Fund" with a straight face proves that they are in on the fraud -- or perhaps just too afraid to acknowledge the obvious, ugly truth of the coming train wreck.
There is not one red penny in the "trust fund" because every cent has been "loaned" to the federal government to fund its everyday spending. It has been this way for decades. All that the "trust fund" owns is a pile of IOUs from the federal government that can never be repaid.
Don't ever let a politician get away with any reference to the "Social Security Trust Fund" without a challenge!
They are in the same position Social Security recipients.
Yes, but since they’re unionized, at least on some moderate extent, they will be at the front of the line. Just like the UAW Union was in front of the GM confiscation over the prime bond holders (something NEVER perpetrated before in this country). These guaranteed (ha!) bondholders got pennies on the dollar, if that. I bear no ill will to military retirees and I don’t think of them in the same vein as much of the civilian work force; they are not the problem with this country.
What you say is true about Treasuries in general. But I don’t think we borrow anything to pay interest on money owed to the SS fund. This debt is based on some special issue Treasuries but no money is actually borrowed to pay any interest on them. We just let the ‘principle’ increase. It is simply an obligation of the people of the United States to SS recipients. If we someday fail to meet that obligation nothing actually happens except we have a bunch of very upset people who have paid into SS and are getting nothing back.
Pretty sure that I’m right about that.
Anyone who thinks this is all going to be solvent for 5 years let alone until 2036 is a very gullible person. It is already not solvent without massive borrowing. These kinds of stories just make me mad.
Whoever the Republican Candidate should be, our mantra must proclaim,”Obama and the Democrats DESTROYED Social Security and Medicare”.
They play this card every election and we need to properly assign responsibility to the Democrats.
How do we figure out how much has been siphoned off from social security taxes paid by the worker and the employer over the years. We are now at the point where the taxes barely cover the payments, but that hasn’t been the case for a LOT of years. I don’t know the exact, or even approximate, figures but I DO know if the money had been set aside as it was supposed to be we would not be in the fix we are now. And, just as importantly, if government had not had access to that money to use to disguise the deficit spending that was proliferating we wouldn’t have the national debt we do now.
I consider it very wrong to blame those who have paid into a fund their entire working lives, matched by their employers, for the problems the system now has.
And what really angers me is that we have no recourse now and no way to punish those who STOLE the money. And then they blame us as though we are somehow being unfair to simply ask them to do what they said they would. We kept our end of the bargain!
Agreed.
Democrats liked and Social Security died... or something like that.
Apparently, the USPS isn’t doing well. Maybe they are dipping into the SS trust fund to pay for the USPS.
Truster = believers in the Social Security Trust Fund.
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