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Thread: Social Security To Go Bust By 2030: CBO

  1. #131
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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by mtm1963 View Post
    it adds to the national debt.
    So? So what if it technically adds to the national debt, it doesn't change the fact it's debt we owe ourselves and debt which we have almost always been able to pay off easily. It's like taking from your car fund to pay your grocery bill. You'll still have money to put in the car fund when it's time to buy a new car, but right now you need to eat.
    we pay interest on that debt.
    As we should. If I had put a $5 bill in a coffee can and buried it in the backyard 40 years ago, would it still be just as valuable today as it was when I buried it? Of course not. That's why you don't just let money sit.

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Slyfox696 View Post
    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.

    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.
    the SS tax was to fund SS only. get it!! it's surpluses are NOT there to fund other government programs as congress has done but to fund future benefits. get it!!
    Go Vols

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Visbek View Post
    Quote Originally Posted by Visbek View Post
    Good grief. Let's try this again.

    When we look at life expectancy changes AFTER reaching adulthood, aka 21 years of age:

    People are living longer than in the recent past.
    People are living more years beyond age 65 than in the past.
    As a percentage of the population, more people are living beyond 65 than in the past.
    People are retiring earlier than in the recent past.
    People are working fewer years than in the past.
    The age of eligibility has barely budged, in fact it was reduced slightly
    Women have increasingly entered the labor force since the 1970s. While this means more contributions, it also means higher payouts -- especially since women's adult longevity has increased more than men's.

    Separately, birth rates have fallen, so we have fewer contributors as a percentage of the population.

    Result? You have fewer contributors trying to support more recipients, at the same per-capita benefits.

    It would be mistaken to say that the increased adult longevity is the only factor. But it's equally mistaken to say that it has no effect whatsoever.



    I addressed that extensively in my post. Please try to actually read what I write next time.



    And which "rise in costs" do you mean? Surely you can't mean COLA, since the payroll taxes have also kept pace with inflation, until a few years ago. Could it be that SS costs are rising because... more people are collecting Social Security for more years?

    It would be mistaken to say that the increased adult longevity is the only factor. But it's equally mistaken to say that it has no effect whatsoever.



    I addressed that extensively in my post. Please try to actually read what I write next time.



    And which "rise in costs" do you mean? Surely you can't mean COLA, since the payroll taxes have also kept pace with inflation, until a few years ago. Could it be that SS costs are rising because... more people are collecting Social Security for more years?
    In 1940, the cost of Social Security was 2% of the first $3,000. Today the retirement portion of Social Security is %10.6 of the first $117,000. If you inflation adjust the $3,000 you will find that it is roughly 1/2 of what it is today. I read your charts, one of which stopped in 1995 which is out of date. The other started in 1950, and it is unclear what data is presented. It says that an average person worked 54 years in 1900. I am guessing that the life expectancy of someone born in 1900 was about 50 years.

    Quote Originally Posted by Visbek View Post
    Good grief.

    It would be mistaken to say that the increased adult longevity is the only factor. But it's equally mistaken to say that it has no effect whatsoever.

    I addressed that extensively in my post. Please try to actually read what I write next time.
    There is a certain amount of irony in your words. If you had read the article you would have found out that I said we have no idea what the impact of longer-life expectancy is because most people are looking at the wrong data points.

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Slyfox696 View Post
    So? So what if it technically adds to the national debt, it doesn't change the fact it's debt we owe ourselves and debt which we have almost always been able to pay off easily. It's like taking from your car fund to pay your grocery bill. You'll still have money to put in the car fund when it's time to buy a new car, but right now you need to eat.
    As we should. If I had put a $5 bill in a coffee can and buried it in the backyard 40 years ago, would it still be just as valuable today as it was when I buried it? Of course not. That's why you don't just let money sit.
    how is it that we rationalize the idea of our government borrowing from itself?

    can you borrow from yourself?
    Go Vols

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by mtm1963 View Post
    it adds to the national debt. we pay interest on that debt.
    yes... It adds to the national debt whether the money was borrowed from SS, private pensions, or China.

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by mtm1963 View Post
    the SS tax was to fund SS only.
    And it does. Like I said.

    get it!!
    Yes, I've always gotten it. What you don't seem to understand is how Social Security works or how inflation cripples money which is not invested.

    it's surpluses are NOT there to fund other government programs as congress has done but to fund future benefits. get it!!
    Have you never heard of inflation? Have you never heard the phrase "a dollar doesn't go as far as it used to"? Are you completely incapable of understanding the Trust Fund is made up ONLY of overpayments into Social Security and it's not (realistically speaking) where the money comes from to pay benefits?

    Do you not understand any of this, despite me explaining it to you multiple times?
    Quote Originally Posted by mtm1963 View Post
    how is it that we rationalize the idea of our government borrowing from itself?
    Because it's a standard practice in any budget?

    can you borrow from yourself?
    Uhh, did I not just give you an example of how a person borrows from oneself? People borrow from themselves all the time.
    Last edited by Slyfox696; 07-17-14 at 06:54 PM.

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by mtm1963 View Post
    the SS tax was to fund SS only. get it!! it's surpluses are NOT there to fund other government programs as congress has done but to fund future benefits. get it!!
    Here is what I get. You believe that surpluses have funded other government programs. The SSA says that it is an urban legend, spread on the internet. Everything that you are saying about SS is the same as your private pension.

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by Slyfox696 View Post
    And it does. Like I said.

    Yes, I've always gotten it. What you don't seem to understand is how Social Security works or how inflation cripples money which is not invested.

    Have you never heard of inflation? Have you never heard the phrase "a dollar doesn't go as far as it used to"? Are you completely incapable of understanding the Trust Fund is made up ONLY of overpayments into Social Security and it's not (realistically speaking) where the money comes from to pay benefits?

    Do you not understand any of this, despite me explaining it to you multiple times?
    congress spent the SS surpluses.
    Go Vols

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by mtm1963 View Post
    congress spent the SS surpluses.
    With the promise they would pay them back with interest. And we always do. And if we hadn't spent the money, it would simply sit in a coffee can falling victim to inflation.

    I don't know why you are having such a hard time understanding this.

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    Re: Social Security To Go Bust By 2030: CBO

    Quote Originally Posted by JoeTheEconomist View Post
    Here is what I get. You believe that surpluses have funded other government programs. The SSA says that it is an urban legend, spread on the internet. Everything that you are saying about SS is the same as your private pension.
    table 1 page two in the PDF file.

    SS surpluses went toward reducing the yearly budget deficits.

    http://www.cbo.gov/sites/default/fil...-corrected.pdf
    Go Vols

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