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Thread: Social Security not as broke as we thought

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    Re: Social Security not as broke as we thought

    Quote Originally Posted by ptif219 View Post
    Yet it is full of IOU's from congress because they see it as a slush fund
    You said there was no SS Trust Fund, then you quote from the SS administration which says you are full of ****. I'm loving it.

    Get this concept through your head, U.S. securities are not IOU's and that's what the SS Trust fund is - Treasury securities - and are guaranteed as to both principal and interest by the Federal government.


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    Re: Social Security not as broke as we thought

    Quote Originally Posted by pbrauer View Post
    You said there was no SS Trust Fund, then you quote from the SS administration which says you are full of ****. I'm loving it.

    Get this concept through your head, U.S. securities are not IOU's and that's what the SS Trust fund is - Treasury securities - and are guaranteed as to both principal and interest by the Federal government.
    Congress spends the money

    Stopping the Social Security Raid - March 20, 2007 - The New York Sun

    President Bush explained this pretty well in a speech in 2005: "You pay your payroll tax, we pay out to current retirees, and then we spend your money on other government programs."

    In 2006 this thievery reached a milestone, passing the staggering number of $1 trillion used for programs other than Social Security since 1983. And that's not including interest. That enormous amount of money has allowed both parties in Congress to fund innumerable wasteful programs and pork-barrel projects while concealing the size of the deficit.

    Social Security is expected to remain in cash-flow surplus for the next decade, and the raid is scheduled to continue. Under present law, Congress will raid Social Security funds to the tune of $693 billion over the next decade, not including interest. If a tax-increase deal did come together, it would amplify the size of the larceny while doing nothing to make Social Security a better deal for workers.

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    Re: Social Security not as broke as we thought

    Quote Originally Posted by pbrauer View Post
    You said there was no SS Trust Fund, then you quote from the SS administration which says you are full of ****. I'm loving it.

    Get this concept through your head, U.S. securities are not IOU's and that's what the SS Trust fund is - Treasury securities - and are guaranteed as to both principal and interest by the Federal government.
    Could you please explain to me the difference between an IOU and a security?

    .

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    Re: Social Security not as broke as we thought

    Quote Originally Posted by TOJ View Post
    Could you please explain to me the difference between an IOU and a security?

    .
    An IOU is a promissory note, a security is actually an asset and payable upon demand. Daily FICA inflow is used to buy securities and the money is put into the Treasury, when benefits are paid money from the Treasury is used pay the SS administration for the securities they hold. The resulting monies are distributed as benefits.

    If they were IOU's, they could remain that way forever and never paid. The claim that the SS Trust fund is a bunch of worthless IOU's is BS.


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    Re: Social Security not as broke as we thought

    Quote Originally Posted by pbrauer View Post
    An IOU is a promissory note, a security is actually an asset and payable upon demand. Daily FICA inflow is used to buy securities and the money is put into the Treasury, when benefits are paid money from the Treasury is used pay the SS administration for the securities they hold. The resulting monies are distributed as benefits.

    If they were IOU's, they could remain that way forever and never paid. The claim that the SS Trust fund is a bunch of worthless IOU's is BS.
    Sad that everyone laughed at Gore in 2000 when he talked about a social security lock box. I sure wish we had that now.

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    Re: Social Security not as broke as we thought

    ...how is that an "interesting take" in any way? He's just repeating facts that are common knowledge and is rehashing "solutions" that don't actually solve anything.

    It's true that SS has a $2.5b "trust fund," but it also has $16b in unfunded liabilities. $2.5b ain't ****. In addition, removing the cap wouldn't actually do anything to fix SS's problems, as it would increase liabilities in tandem with its revenues.
    People sleep peaceably in their beds at night only because rough men stand ready to do violence on their behalf.

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    Re: Social Security not as broke as we thought

    Quote Originally Posted by RightinNYC View Post
    ...how is that an "interesting take" in any way? He's just repeating facts that are common knowledge and is rehashing "solutions" that don't actually solve anything.

    It's true that SS has a $2.5b "trust fund," but it also has $16b in unfunded liabilities. $2.5b ain't ****. In addition, removing the cap wouldn't actually do anything to fix SS's problems, as it would increase liabilities in tandem with its revenues.
    This is probably the easiest of the long term problems the federal government has to fix. We have had this type of problem before, revised the formula and the system got healthier again.

    Fixing the problem, either by adjusting FICA or the age of retirement should be considered no different than an insurance company making changes due to an actuarial change.

    The government will also have to be smarter in how it collects FICA. For example how they track incomes of people who sell on ebay etc. Are those people paying the FICA on all of their earnings, probably not.

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    Re: Social Security not as broke as we thought

    Quote Originally Posted by pbrauer View Post
    An IOU is a promissory note, a security is actually an asset and payable upon demand. Daily FICA inflow is used to buy securities and the money is put into the Treasury, when benefits are paid money from the Treasury is used pay the SS administration for the securities they hold. The resulting monies are distributed as benefits.

    If they were IOU's, they could remain that way forever and never paid. The claim that the SS Trust fund is a bunch of worthless IOU's is BS.
    It is the government. Where will they get the money to pay the securities?

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    Re: Social Security not as broke as we thought

    from RightinNYC

    In addition, removing the cap wouldn't actually do anything to fix SS's problems, as it would increase liabilities in tandem with its revenues.
    Yes, if we also allowed the level of benefits to rise in direct proportion to the amount paid in. However, that is not what I and many other advocate. I favor removing the cap on income levels for FICA taxes but freezing the benefit levels to the maximum paid today plus a modest inflation adjustment as needed in years to come.

    If you do that, then popping the cap does indeed solve the problem because it infuses the system with massive amounts of new monies but does not increase the liabilities. Of course, then we probably get into a whole new battle about the nature of the program but it does solve the pure financial shortfall problem.

    from ptif219

    It is the government. Where will they get the money to pay the securities?
    taxation. I think that is the normal way that government raises needed revenues.
    Last edited by haymarket; 10-30-10 at 10:52 AM.

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    Re: Social Security not as broke as we thought

    Quote Originally Posted by haymarket View Post
    from RightinNYC



    Yes, if we also allowed the level of benefits to rise in direct proportion to the amount paid in. However, that is not what I and many other advocate. I favor removing the cap on income levels for FICA taxes but freezing the benefit levels to the maximum paid today plus a modest inflation adjustment as needed in years to come.

    If you do that, then popping the cap does indeed solve the problem because it infuses the system with massive amounts of new monies but does not increase the liabilities. Of course, then we probably get into a whole new battle about the nature of the program but it does solve the pure financial shortfall problem.

    from ptif219



    taxation. I think that is the normal way that government raises needed revenues.
    You mean steal from peter to pay paul

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