Obama may have trouble with the old folks

[redandguilty]

okay. Well, assuming that's accurate - not that I don't trust you, it's just that I'm not familiar with the figures - then they should refinance the program, or adjust the benefits. it doesn't mean the program is bad, obama is bad, or we need to hand our retirement planning to the private sector so they can do the same job - or more likely worse - than the government, but charge a lot more to do it.

He's right. Al Gore's 'lock box' idea never happened. SS taxes have been bigger than the outgoing payments for a long time. The difference was not set aside in a special account. It's not that any specific program went through a process to borrow funds against SS, just that the SS surplus has made our deficits (surpluses under Clinton) look better than they would have otherwise. As SS starts running a deficit rather than a surplus, our finances will get that much uglier. If we try to cut SS funding, previous generations can be expected to feel shorted because they payed a lot of money into SS through the years.

This 34 second video gives the scale of the thing up through 2008, just before the deficit took a pretty big step in the bad direction.

[youtube]http://www.youtube.com/watch?v=gGgjU-h_xQw[/youtube]

 

[redandguilty]

The confusion, I think, comes from the fact that there's often references to 'reserves' running out in the 2030's. The reserves are just the sum of the purple bars. It's what you get if you add up all the SS taxes collected by the government and subtract what SS has paid out. That money wasn't actually reserved anywhere. So the government, both parties, over decades, have counted that money twice to paint a rosier picture than we're actually in. They count that money when they reduce the reported deficit by the SS surplus and then they count it again when they describe it as a reserve.

 

[tsmith7559]

we don't borrow money to fund social security. it's a trust fund. it's withheld from wages; it's entirely separate from income taxes and the federal budget.

SO MUCH misinformation out there being pushed by investment banks, the mutual fund industry & their lobbyists to reap the windfall they would receive if they were able to get their greedy, slimy hands all over social security money.

lol. that "trust fund" is filled with IOU's.....from us the people...there isn't any "cash" sitting in a bank

 

[redandguilty]

we don't borrow money to fund social security. it's a trust fund. it's withheld from wages; it's entirely separate from income taxes and the federal budget.

SO MUCH misinformation out there being pushed by investment banks, the mutual fund industry & their lobbyists to reap the windfall they would receive if they were able to get their greedy, slimy hands all over social security money.

The thing that's wrong here is that SS is not separate from the federal budget, SS income and expenditures are both significant parts of the federal budget, and the eroding SS surplus has been making the budget look better than it really is.

 

[tsmith7559]

The thing that's wrong here is that SS is not separate from the federal budget, SS income and expenditures are both significant parts of the federal budget, and the eroding SS surplus has been making the budget look better than it really is.

It needs to be separated, but even at that the system isn't working

 

[redandguilty]

It needs to be separated, but even at that the system isn't working

The system need to be reworked, periodically, but I don't think it should be separate. It should be accounted for more properly when deficits are reported so that people understand that state of the the nation, but separating that much money for the economy by some singular policy is a bad idea I think. Obviously you would have to put that money somewhere. Anything you throw that much money at will be impacted dramatically.

For example, privatize it? Bad idea. Throwing that much money at stocks just drives up the price of stocks. It would just skew the relative value of that facet of our economy (and make rich people more powerful overnight.) You can't make wealth by throwing ridiculous amounts of fiat currency at something, you only shift the relative value of things. The result would be that the value of stocks would increase relative to the value of an hour of labor. That skews things to the benefit of the already rich over the poor.

!!!!***!!!!
According to wikipedia, there is such a thing as a social security trust fund that other agencies borrow from. Then what the hell was Gore talking about with his lock box talk? Wikipedia says economists argue whether or not the trust fund is real from an economic standpoint. And either way, they double count it the way I described before. Something is fishy. If SS takes out government bonds when they lend the money to the government for other programs, those bonds should count against the deficit...but the IOUSA video, make the ex-CBO guys, suggests otherwise.

 

[Michchamp]

you read Greenspan's book. he said they fixed it back in 1980, so it would stay fully funded. I don't remember the particulars, just throwing out another source of info.

not like I'd particularly believe Greenspan, but in this case, he was speaking against his own conservative, pro-banking, pro-business, anti-government instincts, so why would he make that up?

 

[redandguilty]

you read Greenspan's book. he said they fixed it back in 1980, so it would stay fully funded. I don't remember the particulars, just throwing out another source of info.

not like I'd particularly believe Greenspan, but in this case, he was speaking against his own conservative, pro-banking, pro-business, anti-government instincts, so why would he make that up?

It definitely improved dramatically then. I just think it needs to be fixed more often than once every couple decades. Things change.

 

[redandguilty]

So I took a look to double check, and I don't think Greenspan covers what he did with social security. He does describe SS as a looming problem a few times.

One thing he does comment on is the tendency for conditional approvals to lose their conditions. For example, he approved of some Bush tax cuts, pre-9/11 economy bust, on the condition that however big the cuts were, they were matched by spending cuts.

Also, I figure you might appreciate this, when I read that book, I used Chinese currency for a bookmark.

 

[tsmith7559]

The system need to be reworked, periodically, but I don't think it should be separate. It should be accounted for more properly when deficits are reported so that people understand that state of the the nation, but separating that much money for the economy by some singular policy is a bad idea I think. Obviously you would have to put that money somewhere. Anything you throw that much money at will be impacted dramatically.

For example, privatize it? Bad idea. Throwing that much money at stocks just drives up the price of stocks. It would just skew the relative value of that facet of our economy (and make rich people more powerful overnight.) You can't make wealth by throwing ridiculous amounts of fiat currency at something, you only shift the relative value of things. The result would be that the value of stocks would increase relative to the value of an hour of labor. That skews things to the benefit of the already rich over the poor.

!!!!***!!!!
According to wikipedia, there is such a thing as a social security trust fund that other agencies borrow from. Then what the hell was Gore talking about with his lock box talk? Wikipedia says economists argue whether or not the trust fund is real from an economic standpoint. And either way, they double count it the way I described before. Something is fishy. If SS takes out government bonds when they lend the money to the government for other programs, those bonds should count against the deficit...but the IOUSA video, make the ex-CBO guys, suggests otherwise.

How about I decide on where my contribution goes???? Its worked well on my 401K and IRA's. I dont have trillions in unfunded liabilities.

 

[redandguilty]

How about I decide on where my contribution goes???? Its worked well on my 401K and IRA's. I dont have trillions in unfunded liabilities.

How about you try to pick in the midst of everyone else trying to make the same picks at the same time? Prices would skyrocket.

 

[tsmith7559]

How about you try to pick in the midst of everyone else trying to make the same picks at the same time? Prices would skyrocket.

People would be better off having a there own mandatory savings account at a Bank then to give it to the govt.

 

[thundernlightning]

People would be better off having a there own mandatory savings account at a Bank then to give it to the govt.

Wrong.

The annual inflation rate in America supercedes even the most modest of interest rates in savings accounts, whereas people would actually be losing value in their investments should they tie them up in savings accounts.

 

[Slick]

Wrong.

The annual inflation rate in America supercedes even the most modest of interest rates in savings accounts, whereas people would actually be losing value in their investments should they tie them up in savings accounts.

lol....Tsmith slapped again

 

[tsmith7559]

lol....Tsmith slapped again

SS is over $50 Trillion in unfunded liabilities...Ill take the money in the bank any day....you can have the IOU's slick

 

[tsmith7559]

Wrong.

The annual inflation rate in America supercedes even the most modest of interest rates in savings accounts, whereas people would actually be losing value in their investments should they tie them up in savings accounts.

SS secures has liabilities over $50 Trillion....I like my plan

 

[Slick]

SS is over $50 Trillion in unfunded liabilities...Ill take the money in the bank any day....you can have the IOU's slick

no need..my CPP is all good >

 

[thundernlightning]

no need..my CPP is all good >

Exactly. Deal with SS as it stands today until any reform is performed. Until then, invest in a diverse stock portfolio. But at your age, TSmith, Id go for bonds if i were you, as they don't grow as much, but are safer for retirement-aged individuals.

All this coming from an economics major, FYI. (so many holes in every bit of shit you throw at the wall, its not funny. and not just pertaining to this post, either)

 

[thundernlightning]

lol....Tsmith slapped again

I am curious though, Slick, what are the interest rates on standard savings accounts across the border?

 

[tsmith7559]

Exactly. Deal with SS as it stands today until any reform is performed. Until then, invest in a diverse stock portfolio. But at your age, TSmith, Id go for bonds if i were you, as they don't grow as much, but are safer for retirement-aged individuals.

All this coming from an economics major, FYI. (so many holes in every bit of shit you throw at the wall, its not funny. and not just pertaining to this post, either)

I'm all set...thanks