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Thread: Social Security To Go Bust By 2030: CBO

  1. #121
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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by mtm1963 View Post
    your statement is not true.

    evidently do you not understand the trust fund is full of IOU's? there is NO cash in the trust fund. ZERO nada nothing!!
    The inability of people to understand anything but the most literal definitions saddens me sometimes.

    The Trust Fund is full of "IOUs", but that doesn't mean there isn't money there. It's no different from when you put your money in the bank and the bank then loans it out to people wanting to start a business. This isn't even basics of accounting, it's just basics.

    There is a Trust Fund. To put it in terms you might understand, there is a positive bank balance. Saying anything else is simply wrong.

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Slyfox696 View Post
    The inability of people to understand anything but the most literal definitions saddens me sometimes.

    The Trust Fund is full of "IOUs", but that doesn't mean there isn't money there. It's no different from when you put your money in the bank and the bank then loans it out to people wanting to start a business. This isn't even basics of accounting, it's just basics.

    There is a Trust Fund. To put it in terms you might understand, there is a positive bank balance. Saying anything else is simply wrong.
    However the elephant in the room is how are we going to pay back said IOUs without massive income tax increases and/or a scorched earth policy towards government spending?

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Slyfox696 View Post
    The inability of people to understand anything but the most literal definitions saddens me sometimes.

    The Trust Fund is full of "IOUs", but that doesn't mean there isn't money there. It's no different from when you put your money in the bank and the bank then loans it out to people wanting to start a business. This isn't even basics of accounting, it's just basics.

    There is a Trust Fund. To put it in terms you might understand, there is a positive bank balance. Saying anything else is simply wrong.
    there is trust fund full of borrowed money.
    Go Vols

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Winchester View Post
    However the elephant in the room is how are we going to pay back said IOUs
    The way we've always done it? You do realize (in simple terms, at least) we pay back the IOUs every month, right?
    Quote Originally Posted by mtm1963 View Post
    there is trust fund full of borrowed money.
    Uhh, no. That doesn't make sense at all. We borrow from the Trust Fund in order to protect it from falling victim to inflation. When it comes time to pay benefits, we pay back the Trust Fund (with interest, through payroll taxes) what we borrowed so we can then make payments.

    Here's some basic info.

    http://www.ssa.gov/oact/ProgData/fundFAQ.html#a0=2

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Slyfox696 View Post
    The way we've always done it? You do realize (in simple terms, at least) we pay back the IOUs every month, right?
    Right by borrow more. Any day of reckoning in your future?

  6. #126
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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Slyfox696 View Post
    The way we've always done it? You do realize (in simple terms, at least) we pay back the IOUs every month, right?
    Uhh, no. That doesn't make sense at all. We borrow from the Trust Fund in order to protect it from falling victim to inflation. When it comes time to pay benefits, we pay back the Trust Fund (with interest, through payroll taxes) what we borrowed so we can then make payments.

    Here's some basic info.

    Trust Fund Data
    congress spends surplus monies from SS in order to expand and fund other parts of government.
    Go Vols

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Visbek View Post
    Here ya go. Put in your choices, and see if it makes SS solvent for the next 75 years. Based on what you're saying, I don't think your plan does enough, but there are plenty of additional options.

    The Reformer: An Interactive Tool to Fix Social Security

    Here is the CRFB's disclosure : " In most cases, the effects of policy choices are estimated based on the 2012 Social Security Trustees Report; however, baseline metrics are based on the 2013 Social Security Trustees Report, given that the Social Security Administration typically needs additional time to update estimates of reform options in light of new projections." So it is about a trillion dollars out of date on the solvency shortfall, likely closer to 2 trillion once the 2014 Report comes out. In terms of eliminating the cap, CRFB says it's 77% of the solvency shortfall. CBO two days ago projected that it was 45%. So it is a useful tool give or take 30%.

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by mtm1963 View Post
    congress spends surplus monies from SS in order to expand and fund other parts of government.
    Congress spends surplus monies of private pensions in the same way. Yes the government borrows money. Yes the government will repay it with interest. What is the point of what Congress does with borrowed money whether it is from SS, private pensions, or China.

  9. #129
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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Winchester View Post
    Right by borrow more. Any day of reckoning in your future?
    No. Just no. I get the feeling you don't understand how Social Security works. I'll give you the quick and dirty version.

    1. Employees pay payroll taxes.
    2. Payroll taxes are sent to the government who then send them out to Social Security beneficiaries. In simple terms, it has NOTHING to do with a Trust Fund (it does, but to keep it simple, it doesn't).
    3. Overpayments of today's employees, meaning money from payroll taxes left over after paying benefits goes into the Trust Fund.
    3a. Again, please note, for all practical purposes, we are NOT paying beneficiaries from the Trust Fund (even though we are, but for our simple explanation, it's easier to explain this way).
    4. The money in the Trust Fund is simply OVERPAYMENTS of payroll taxes. This money, if left sitting in a cash envelope, would fall victim to inflation. Thus, in order to preserve the money and to be able to pay out the benefits necessary, the government borrows against the Trust Fund.

    This really isn't hard to understand. We're borrowing money from ourselves, with the promise to pay ourselves back with the same purchasing value as when we borrowed it.
    Quote Originally Posted by mtm1963 View Post
    congress spends surplus monies from SS in order to...fund other parts of government.
    Yes, that's WHAT they do with it. WHY they borrow the money is to preserve the integrity of the fund, to keep it consistent with inflation.

    I'm sorry you don't understand the basics of Social Security. I don't blame you, it's not easy to understand. I don't understand the technicalities of it either. But I do understand the general concepts behind it. And that's why I'm trying to educate you, to get you to do the same.

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by JoeTheEconomist View Post
    Congress spends surplus monies of private pensions in the same way. Yes the government borrows money. Yes the government will repay it with interest. What is the point of what Congress does with borrowed money whether it is from SS, private pensions, or China.
    it adds to the national debt. we pay interest on that debt.
    Go Vols

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