Next in Line for a Bailout: Social Security

[Harry Guerrilla]

next-in-line-for-a-bailout-social-security: Personal Finance News from Yahoo! Finance

Don't look now. But even as the bank bailout is winding down, another huge bailout is starting, this time for the Social Security system.

A report from the Congressional Budget Office shows that for the first time in 25 years, Social Security is taking in less in taxes than it is spending on benefits.

Instead of helping to finance the rest of the government, as it has done for decades, our nation's biggest social program needs help from the Treasury to keep benefit checks from bouncing -- in other words, a taxpayer bailout.

Why disregard the interest? Because as people like me have said repeatedly over the years, the interest, which consists of Treasury IOUs that the Social Security trust fund gets on its holdings of government securities, doesn't provide Social Security with any cash that it can use to pay its bills. The interest is merely an accounting entry with no economic significance.

Social Security hasn't been cash-negative since the early 1980s, when it came so close to running out of money that it was making plans to stop sending out benefit checks. That led to the famous Greenspan Commission report, which recommended trimming benefits and raising taxes, which Congress did. Those actions produced hefty cash surpluses, which until this year have helped finance the rest of the government.

It would have been a lot simpler to fix the system years ago, when we could have used Social Security's cash surpluses to buy non-Treasury securities, such as government-backed mortgage bonds or high-grade corporates that would have helped cover future cash shortfalls. Now it's too late.

Even though an economic recovery might produce some small, fleeting cash surpluses, Social Security's days of being flush are over.

People have been warning for years that this was going to happen and now that it has started, who's going to have to pay for the elderly bail out?

 

[Cold Highway]

People have been warning for years that this was going to happen and now that it has started, who's going to have to pay for the elderly bail out?

The Tax Payers sadly.

 

[Scarecrow Akhbar]

People have been warning for years that this was going to happen and now that it has started, who's going to have to pay for the elderly bail out?

Everyone.

Until the government goes broke.

What is really going to happen is this:

Socialist Security is an internal debt.

Nations that face unsupportable internal debt all eventually find THE solution:

They print money.

Germany, Brazil, Zaire, and soon the US. The US has to expand the money supply by over a hundred trillion dollars to pay off Socialist Security claims.

That, of course, is after they raid the 401(k) funds.

Ain't socialism just grand?

 

[ptif219]

The democrats stopped Bush from doing anything and had no plan of their own. They did nothing but obstruct. Wait is that not what they accuse the GOP of today. So where did the GOP learn this?

This is a portion of a op ed that shows the democrats did nothing for SS all they did was stop Bush.

Free Frank Warner: Unless she?s stupid, Rep. Nancy Pelosi is plain dishonest about Social Security


U.S. Rep. Nancy Pelosi, appearing yesterday on “Fox News Sunday,” made it clear the Democrats would rather let Social Security wither on the vine than work honestly with President Bush to save it.

And despite repeated questions from Chris Wallace, she offered no Democratic proposal to save the program, which will be required to begin paying out more than it takes in by 2020.

Meanwhile, Pelosi remains a hero to people like Joshua Marshall at Talking Points Memo, who daily tries to split hairs on such subjects as whether Bush is lying when he says the optional private accounts could be an “add-on” to Social Security.

If Pelosi and the Democrats get their way, and Social Security’s benefits are cut 30 percent between 2020 and 2050, the private accounts will be a welcome add-on just to help make up the difference.

So just what did Pelosi, the House Democratic leader, say yesterday that anyone in her position should know is not true? Let’s look look at three points.

Pelosi dishonesty No. 1.

She said the president’s Social Security plan, which she admitted has not even been released in full, “would necessitate slashing benefits by 40 percent.”

How would Pelosi know this? Bush has said almost everything is on the negotiating table. He and high-ranking Republicans have even left the door open to tax increases. The only tax increase Bush has ruled out is a hike in the payroll tax rate.

But he and others have indicated they are willing to consider raising the cap on how much income is subject to the Social Security tax (right now, income over $90,000 is not taxed), and they have indicated that a tax on exports and imports could be created.

So how can Pelosi honestly say she knows Bush intends to cut Social Security benefits by 40 percent? If the Democrats bargained in good faith, benefits might not be cut at all. But if the Democrats insist on no change at all in Social Security, benefits eventually will have to be cut by 30 percent.

 

[jujuman13]

This is but one reason why Obama wants Obamacare enacted ASAP, kill off the aged of the USA by denying them medicare / medicaid.
It is also why Obama wants to exempt all Politicians from his new all embracing transparent Health reform.

 

[USA_1]

The democrats stopped Bush from doing anything and had no plan of their own. They did nothing but obstruct. Wait is that not what they accuse the GOP of today. So where did the GOP learn this?
.

The republicans had control of the Whitehouse and congress for 6 years. If they really wanted to do something, they had ample opportunity.

SS benifits have to be cut now.

 

[Scarecrow Akhbar]

The republicans had control of the Whitehouse and congress for 6 years. If they really wanted to do something, they had ample opportunity.

SS benifits have to be cut now.

Hint:

Study how laws are made someday.

Hint:

Pay attention to what happens now that Brown is in the Sentate.

Hint:

The Democrats have always been able to filibuster.

Hint:

There's no real difference between elected Democrats and many elected Repubilcans. **** stinks, doesn't matter if it's ****(R) or ****(D) .

 

[USA_1]

Hint:

Study how laws are made someday.

Hint:

Pay attention to what happens now that Brown is in the Sentate.

Hint:

The Democrats have always been able to filibuster.

Hint:

There's no real difference between elected Democrats and many elected Repubilcans. **** stinks, doesn't matter if it's ****(R) or ****(D) .

The republicans didn't even try to do anything about SS. Unless you consider the lamebrain idea to put SS into the stock market was an attempt to fix it. Using the filibuster excuse just doesn't cut it.
Republicans are just as worthless as democrats. Maybe if they did some leading the democrats would not have won back congress and Obama wouldn't be president.

 

[Winnb]

This is but one reason why Obama wants Obamacare enacted ASAP, kill off the aged of the USA by denying them medicare / medicaid.
It is also why Obama wants to exempt all Politicians from his new all embracing transparent Health reform.

This kind of posting belongs in the Conspiracy Theory forum. Obama's not trying to kill the elderly.

 

[ptif219]

The republicans had control of the Whitehouse and congress for 6 years. If they really wanted to do something, they had ample opportunity.

SS benifits have to be cut now.

Nice try but the one vote majority that the GOP had could do nothing. The dems have had a majority 3 years now and a filibuster proof on for a year and they have done nothing. Notice the article shows the dems blocked anything the GOP wanted. The same thing they accuse the GOP of today.

Problem is until today the GOP could not block the democrats with a filibuster proof senate.

 

[ptif219]

The republicans didn't even try to do anything about SS. Unless you consider the lamebrain idea to put SS into the stock market was an attempt to fix it. Using the filibuster excuse just doesn't cut it.
Republicans are just as worthless as democrats. Maybe if they did some leading the democrats would not have won back congress and Obama wouldn't be president.

So what have the dems done the last 3 years?

 

[USA_1]

So what have the dems done the last 3 years?

The dems are the party of fiscal irresponsiblity, I didn't expect them to do anything to shore up SS. The GOP endlessly preaches how they are more fiscally responsible yet they have proven over and over they are just a useless as the democrats.

 

[ptif219]

The dems are the party of fiscal irresponsiblity, I didn't expect them to do anything to shore up SS. The GOP endlessly preaches how they are more fiscally responsible yet they have proven over and over they are just a useless as the democrats.

I see, same old double standard

 

[USA_1]

I see, same old double standard

What do you mean? I dislike both parties equally. I just expect better from republicans and hold them to a higher standard.

 

[Cold Highway]

I see, same old double standard

No its not a double standard, anyone with a brain knows the Dems dont stand for ****. People like you dont like it when people like USA-1 get tired of same garbage recycled over and over. Whats supposed to be different about these "new" Republicans? Seems like nothing but same ****, different day.

 

[USA_1]

Time for a third party. A common sense party.

 

[ptif219]

What do you mean? I dislike both parties equally. I just expect better from republicans and hold them to a higher standard.

Thats a double standard. Why not hold them both to the same standard?

 

[ptif219]

No its not a double standard, anyone with a brain knows the Dems dont stand for ****. People like you dont like it when people like USA-1 get tired of same garbage recycled over and over. Whats supposed to be different about these "new" Republicans? Seems like nothing but same ****, different day.

The GOP has no power but blame them for what happened years ago. Let the dems have a pass. That is a double standard and a Bias against the GOP.

 

[ptif219]

Time for a third party. A common sense party.

The constitution party

 

[Scarecrow Akhbar]

The republicans didn't even try to do anything about SS.

yes, they did.

They mentioned, in passing, the Socialist Security is a damn stupid idea, nothing more than a Ponzi Scheme, and the youth of the nation would be a thousand times better off putting that money in publicly traded stocks and bonds.

Unless you consider the lamebrain idea to put SS into the stock market was an attempt to fix it.

Lamebrains believe that the government can do things better for people than they can do for themselves.

Adults don't want nannies.

Also, since the person owning a stock can pass that asset on to his heirs after he croaks, his heirs start off with greater initial wealth, reducing the likelihood that they will die in poverty.

Finally, it's their money, not the government's so why shouldn't people be allowed to abstain from the Ponzi Scheme and take care of themselves, like adults are supposed to do?

 

[Scarecrow Akhbar]

What do you mean? I dislike both parties equally. I just expect better from republicans and hold them to a higher standard.

And then when they promote an idea that is consist with the vision that founded this country, that's consistent with human reality, and consistent with the fact that socialism doesn't work, you sneer at it and call it "lamebrain".

 

[Scarecrow Akhbar]

First three necessary steps in dealing with Socialist Security:

1) Everyone has to learn that Uncle Sam, not Bernie Madoff, is running the world's biggest Ponzi Scheme.

2) Explain that Socialist Security, like all cancers, will be hard to kill, but the nation will survive in the long run, and be better without it.

3) Stop compelling people to participate.

 

[USA_1]

First three necessary steps in dealing with Socialist Security:

1) Everyone has to learn that Uncle Sam, not Bernie Madoff, is running the world's biggest Ponzi Scheme.

2) Explain that Socialist Security, like all cancers, will be hard to kill, but the nation will survive in the long run, and be better without it.

3) Stop compelling people to participate.

They should eliminate it right when you are old enough to collect it.
The old Ponzi scheme spin is getting real old. A ponzi scheme is a fraudulent investment operation. SS is a government program that could work if the numbers were kept in line and the rules changed. SS has kept millions of people from living in squalor for the last 80 years while the US has become the greatest nation on earth. The US was not worse with it. Founding fathers even put it in the constitution.

 

[ptif219]

They should eliminate it right when you are old enough to collect it.
The old Ponzi scheme spin is getting real old. A ponzi scheme is a fraudulent investment operation. SS is a government program that could work if the numbers were kept in line and the rules changed. SS has kept millions of people from living in squalor for the last 80 years while the US has become the greatest nation on earth. The US was not worse with it. Founding fathers even put it in the constitution.

The government has also stolen most of it for other things.

 

[Partisan]

The government has also stolen most of it for other things.

Exactly right.....
It wouldn't be in trouble otherwise.....