Posted on 09/14/2011 2:38:29 PM PDT by Nachum
Blue Dog Democrat Rep. Jim Cooper (D-Tenn.) said that most Americans do not understand that federal entitlements are not “bank account” programs that hold their money, adding that Social Security is not even a legal guarantee -- "Legally, they're not even promises." Cooper, asked about potential reforms to Medicare and Medicaid, said that the core problem was that the public does not understand the true nature of entitlements. “Many Americans don’t really realize that Medicare is a government program,” Cooper said at a press conference with fellow Blue Dogs on Wednesday.
(Excerpt) Read more at cnsnews.com ...
You mean Al Gore lied to me when when assured me all those SS dollars were carefully stored away for my future in a Social Security Lock Box?
Next thing you will be telling me is that the Tooth Fairy is out of money and that the Easter Bunny has just been eaten by a hungry family whose 99 weeks of unemployment benefits have just run out
The Congress has, over a period of years, created so much propaganda and nonsense surrounding Social Security that they should be in jail for mail and wire fraud.
The truth is that your “yearly account” statement is part of that propaganda.
The other truth is that the money you “contributed” is gone. It was spent by the Congress because the Social Security Administration “loaned” the money to the US Treasury by buying US Treasury debt, whereupon the SSA was funding (in part) the general budget deficits of the last 40 years.
Now, since the Social Security system is running either a small surplus of income, or a small deficit as a result of more claims than income, the SSA must start redeeming the internal debt instruments which they bought from the US Treasury in the past. This means that in order to give the money back to the SSA, the US Treasury must issue new debt to redeem the older, internal-to-government debt held by the SSA.
As the boomers retire, the amount of internal debt redemptions will go up - rapidly. Even if we held discretionary and military spending constant, right where it is now, the annual budget deficit will go up by hundreds of billions of dollars per year going forward for the next 20+ years as the boomers retire and fully load down the SSA with claims and the US Treasury must issue new debt to redeem the “old debt” in the SSA in order to allow the SSA to make payments to those who are now making claims on the benefit.
That projected budget deficit increase doesn’t include the increase in interest rates that eventually will have to occur as the US government runs out of people from whom they can borrow funds.
From my playing with the mathematics of the issue, I don’t believe it can be maintained.
To do so will mean, in the following order of events:
1. Higher taxes, which will lead to
2. A slowdown in GDP and employment, which leads to
3. A decrease in tax revenues (income, sales/excise and payroll)
4. Which will lead to bigger deficits faster.
And I fully expect Congress to go down this road - they’re already on this road now.
But at some point, someone will do a study and say “There’s no way around it, we simply must cut spending.” And then we’ll see:
5. Cuts in domestic discretionary spending, starting with things like ag subsidies, roads, law enforcement, etc.
6. Followed by military projects and weapons systems.
7. Followed by more cuts in the defense budget.
8. Now things start getting tight, and they have to start cutting entitlements. First route I foresee is means testing on medical entitlements, then means testing on Social Security. The age of eligibility will be raised.
Eventually, they will have no choice. It will be either “cut entitlements” or go down the road Greece is on now, with huge international and domestic ramifications, including war.
Please don’t use that term, even in jest. Thanks.
Interesting new twist by the dims, seems they may have some surprises in the future for SS recipients.
What contract did you sign?
Really, what contract did you sign for these guaranteed returns?
in other words... It’s just ANOTHER TAX then!!!
Tax return Form 1040, line #57 = “Unreported social security and Medicare TAX from Form...”. Also, line #69 = “Excess social security and tier 1 RRTA TAX withheld.”
What post do you think you're responding to?
My mistake.
Only problem with that is they have guns. And handcuffs. And IRS agents. As soon as the government gets hands on the money, it's gone. And when all we pay is gone, they borrow more in our name.
When not done by government, this is called extortion, fraud, misappropriation, and theft. We should call it the same when it is done by government, instead of taxes, your government at work, Social Security, etc. Don't let the thieves and extortionists win the battle of words.
According to the government, as soon as it touches it, it isn't your money any more. So best to make your money untouchable.
This is a 15 percent raise over time compared to what you are currently taking home. Investing just this alone would probably match or exceed what you think you might get from Social Security.
You thought SS was a quid pro quo? LOL it was ruled long ago by SCOTUS to be nothing more than a tax that imposes NO obligation on the federal government to come through with its promises.
The government STOLE my money and said I could have it back to help out
when I retired. They’re criminals!
Yes, I understand there is an increase in SS obligations in the coming years. Everyone knows about it. It is a future obligation to pay more than it takes in. However, there are far more less credible federal obligations to reduce or eliminate first than to purposely defraud, under color of law, the SS system. That would do enormous damage to the credibility and trust of the USG amongst its most productive citizens. It’s bonds and contracts from that point forward would be worthless to its wage-earing citizens.
I see innumerable budget cutting options before the government would choose to wholly destroy its credibility.
I refer to this as "Senior Freeper Dancing with the Stars" featuring:
the “Cutting Waste and Fraud Will Solve The Problem Two-Step”
the “Let’s Eliminate the Mohair Subsidy and NASA So We Can Save My Monthly Check Cha-Cha-Cha”
the “Get Rid of Every Government Program Except The One That Benefits ME Tango”
the “Tax The Snot Out Of My Grandkids, But Keep My Check Coming Waltz”
and that evergreen favorite, the “Kick The Can Down The Alley Until After I’m Dead Fox Trot"!
Jeff cooper is right, of course. You all do know that? The Fed.gov is NOT legally obligated to pay any funds that are not in the trust fund (which is currently at a zero balance.)
Jeff Cooper is right, of course. You all do know that? The Fed.gov is NOT legally obligated to pay any funds that are not in the trust fund (which is currently at a zero balance.)
Weeeeeelll...that could happen.
If the government can find a magic dwarf who spins straw into gold.
The only other way you will ever "get it all back" is for your kids and your grandkids to be taxed at 2x or 3x the current SS rate so that the money they pay in can be given to you. Is that what you're angling for??
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