View Poll Results: How serious a problem is the divide between the wealthy and the rest of us?

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  • Not a problem at all.

    35 28.46%
  • A problem, but not a serious one.

    8 6.50%
  • A fairly serious problem.

    42 34.15%
  • It's not just a "problem." It's a catastrophe that is only getting worse.

    38 30.89%
  • This divide does not exist.

    0 0%
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Thread: The divide between the rich and the rest

  1. #401
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    Re: The divide between the rich and the rest

    Quote Originally Posted by MoSurveyor View Post
    Who said it was the same thing as cash? This is the second time you've intentionally misrepresented what I posted. It's a Treasury note and whether it has the same utility as cash or T-bills doesn't change the fact it's a promissory note issued by the Fed. Dollar and T-bills are also promissory noted issued by the Fed. When the Fed decides to stop honoring it's obligations you let me know.
    You are mistaking the Fed for Congress. The promissory notes in the SS fund have no value - they aren't tradable (like actual treasury bonds are). Pretending that the Trust Fund represents value is like claiming that your credit card balance should count towards your net assets instead of against it.

    I didn't say they were run out of different offices, I said SSA funded Medicare but not Medicaid.
    And my point is and continues to be that the two are run out of the same accounting line in the Budget, and that the General Fund continues to cover both, to include its' FICA pay-ins.

    So the Fed is going to stop honoring it's obligations?!? How interesting. I wonder if China knows this.
    Likely. That's probably why they have shifted into shorter term paper and the SOE's have started issuing dollar-denominated securities at the same time that they are pushing trading partners to drop the dollar as the currency of exchange.

    SS is government held savings, not a lot different than an annuity bought over 45+ years of working. It also has the benefit of including a disability policy.
    SS is not government held savings, for the simple reason that nothing is saved. What you put in in the form of taxes is immediately spent. You are dependent on others putting money in later if you want any return. Annuity? It's a pyramid scheme with forced participation.

    The Treasury notes and accounting are all there. It could be done of Congress wanted to do it.
    No, it couldn't. All of the political will in the world doesn't change the fiscal reality that we are not going to be able to afford the commitments we have made in the Social Security Program.

    There is no gap in Social Security, there's a gap in other Fed spending that politicians have attempted to bandaid with SSA funds.
    yup. Guess we should have been more upset about that at the time - but hey, government spending helps the economy, so let the good times roll! Now it turns out that the Baby Boomers found a way to blow their government retirement fund, just as most of them blew their private funds, and the money isn't there and isn't going to be there, either. Woops.

    I've seen the numbers and that thread.
    Then you should know that the whole "oh it's too dangerous" schtick isn't going to cut it.

    If the Fed stops honoring it's financial obligations it'll be a full-blown, country-wide riot.
    You are conflating the necessary reductions in SS expenditures with default, which even then would not result in a full-blown country-wide riot.

  2. #402
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    Re: The divide between the rich and the rest

    Quote Originally Posted by cpwill View Post
    You are mistaking the Fed for Congress. The promissory notes in the SS fund have no value - they aren't tradable (like actual treasury bonds are).

    Pretending that the Trust Fund represents value is like claiming that your credit card balance should count towards your net assets instead of against it.
    Congress issues Treasury certificates and bonds? I don't think so.


    That's not even close to the same thing at all.


    Quote Originally Posted by cpwill View Post
    And my point is and continues to be that the two are run out of the same accounting line in the Budget, and that the General Fund continues to cover both, to include its' FICA pay-ins.
    SSA still keeps track of the difference and I'm sure the Medicare/Medicaid office does, too.


    Quote Originally Posted by cpwill View Post
    Likely. That's probably why they have shifted into shorter term paper and the SOE's have started issuing dollar-denominated securities at the same time that they are pushing trading partners to drop the dollar as the currency of exchange.
    Until they do that your continued denial of the SSA Trust Fund remains inaccurate.


    Quote Originally Posted by cpwill View Post
    SS is not government held savings, for the simple reason that nothing is saved. What you put in in the form of taxes is immediately spent. You are dependent on others putting money in later if you want any return. Annuity? It's a pyramid scheme with forced participation.
    Call it what you want, annuities are no different. It's not like insurance companies set up and keep track of some special account for every annuity the sell.


    Quote Originally Posted by cpwill View Post
    No, it couldn't. All of the political will in the world doesn't change the fiscal reality that we are not going to be able to afford the commitments we have made in the Social Security Program.
    I didn't say there weren't needed changes. In fact, I brought the subject up first.

    That makes FOUR intentional misinterpretations.


    Quote Originally Posted by cpwill View Post
    yup. Guess we should have been more upset about that at the time - but hey, government spending helps the economy, so let the good times roll! Now it turns out that the Baby Boomers found a way to blow their government retirement fund, just as most of them blew their private funds, and the money isn't there and isn't going to be there, either. Woops.
    According to recent conservative opinions, Reagan spent a good part of it trying to win the Cold War. I suppose we could restore the USSR to it's former glory and let you guys handle it.


    Quote Originally Posted by cpwill View Post
    Then you should know that the whole "oh it's too dangerous" schtick isn't going to cut it.
    Individually it is too dangerous.


    Quote Originally Posted by cpwill View Post
    You are conflating the necessary reductions in SS expenditures with default, which even then would not result in a full-blown country-wide riot.
    If the Fed stops honoring it's financial obligations then it is default.
    Last edited by MoSurveyor; 05-04-13 at 11:11 AM.
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  3. #403
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    Re: The divide between the rich and the rest

    Quote Originally Posted by MoSurveyor View Post
    Congress issues Treasury certificates and bonds? I don't think so.
    They don't. But the promissory notes in the Trust Fund is not

    That's not even close to the same thing at all.
    in fact - AS YOU POINT OUT, it is exactly the same thing. Not two sentences above you were comparing the promissory notes to Treasury Bonds. What is a bond? It is a debt obligation. The notes in the SS fund? Are debt obligations. What is a credit card balance? It is a debt obligation. You are trying to claim that debt obligations as assets.

    Dude, I'm sorry, there is no money. I realize you are probably older and therefore have a more personal stake in this fight, but, don't let that blind you to the need to make your own preparations. Please do not (personally speaking now) plan your retirement on the assumption that SS will continue in its' current form. Hey, best case scenario, everyone from the Simpson-Bowles Commission to President Clinton to Paul Ryan are all wrong, and the government is just fine.... but don't plan on that.

    Here's a hint. remember back when the President threatened that Social Security Checks might not go out if Congress didn't raise the debt limit? Now, if the SS Trust Fund wasn't dependent upon the General Fund, why would failing to raise the debt limit for that fund have that result?

    SSA still keeps track of the difference and I'm sure the Medicare/Medicaid office does, too.
    money is fungible.

    Until they do that your continued denial of the SSA Trust Fund remains inaccurate.
    the Chinese have already taken all those actions I described. Your continued insistence that changing Social Security because we can no longer afford the current model would equal some kind of default is.... bizarre. It is as though you think you can protect the program in reality by wrapping it in the strongest defense rhetorically.

    Call it what you want, annuities are no different.
    That is incorrect. Annuities pay out from the assets that they own, which have value. Social Security pays out from the pay-ins from new suckers members. The money you paid into Social Security was long spent long ago. The money you get out isn't coming from your input, but rather from the input of others.

    I didn't say there weren't needed changes. In fact, I brought the subject up first.
    Yeah. You suggested that we separate the SS fund from the General Fund, and then refused to acknowledge that having the General Fund no longer fund Social Security means that SS won't be able to make it's payments next month.

    We need to change two things about SS: in the short term, we need to find a way to reduce expenditures, in the long term, we need to find a way to replace our funding mechanism with a more productive model. But depending on attempts to paper over a problem with accounting tricks will not help us.

    According to recent conservative opinions, Reagan spent a good part of it trying to win the Cold War. I suppose we could restore the USSR to it's former glory and let you guys handle it.
    we've continually spent the SS surplus every year until it finally flipped back in 2011. Presidents Johnson through Obama all bear culpability.

    Individually it is too dangerous.
    That is incorrect, as I demonstrated ad-nauseum; you can have the worst returns in post-war history on an income that never exceeds 32,000 a year and then face back to back 2008-2009 style financial meltdowns as you retire and then make the worst decision possible at the worst time possible and you would still come out ahead of Social Security.

    If the Fed stops honoring it's financial obligations then it is default.
    Since it's the general fund that owes SS money, I guess we're safe :-).




    So perhaps you can enlighten us, Mo. What do you think happens when the General Fund loses the ability to fund the gap between Social Security revenues and payouts?

  4. #404
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    Re: The divide between the rich and the rest

    Quote Originally Posted by cpwill View Post
    They don't. But the promissory notes in the Trust Fund is not
    Try again:

    Special issue types and properties
    There are two types of special issues: short-term certificates of indebtedness and long-term bonds.

    The certificates of indebtedness are issued on a daily basis for the investment of receipts not required to meet current expenditures, and they mature on the next June 30 following the date of issue.
    Special-issue bonds are normally acquired only when special issues of either type mature on June 30. The bonds have maturities ranging from one to fifteen years.
    Special-issue securities, Social Security trust funds


    Quote Originally Posted by cpwill View Post
    in fact - AS YOU POINT OUT, it is exactly the same thing. Not two sentences above you were comparing the promissory notes to Treasury Bonds. What is a bond? It is a debt obligation. The notes in the SS fund? Are debt obligations. What is a credit card balance? It is a debt obligation. You are trying to claim that debt obligations as assets.
    Not for the SSA it isn't, it's an asset. That it shows up as debt in the General Fund is a different issue.


    Quote Originally Posted by cpwill View Post
    Dude, I'm sorry, there is no money. I realize you are probably older and therefore have a more personal stake in this fight, but, don't let that blind you to the need to make your own preparations. Please do not (personally speaking now) plan your retirement on the assumption that SS will continue in its' current form. Hey, best case scenario, everyone from the Simpson-Bowles Commission to President Clinton to Paul Ryan are all wrong, and the government is just fine.... but don't plan on that.

    Here's a hint. remember back when the President threatened that Social Security Checks might not go out if Congress didn't raise the debt limit? Now, if the SS Trust Fund wasn't dependent upon the General Fund, why would failing to raise the debt limit for that fund have that result?
    The General Fund couldn't honor ANY obligations for that case including sending checks to defense and other government contractors. If they couldn't do that they also couldn't honor Treasury bonds.


    Quote Originally Posted by cpwill View Post
    the Chinese have already taken all those actions I described. Your continued insistence that changing Social Security because we can no longer afford the current model would equal some kind of default is.... bizarre. It is as though you think you can protect the program in reality by wrapping it in the strongest defense rhetorically.
    They're Treasury certificates and bonds, what more needs to be said? Congress can wipe any debt with the stroke of a pen - even money.


    Quote Originally Posted by cpwill View Post
    That is incorrect. Annuities pay out from the assets that they own, which have value. Social Security pays out from the pay-ins from new suckers members. The money you paid into Social Security was long spent long ago. The money you get out isn't coming from your input, but rather from the input of others.
    You think insurance companies and banks actually have enough cash and other liquid assets on hand to process all their debts?


    Quote Originally Posted by cpwill View Post
    Yeah. You suggested that we separate the SS fund from the General Fund, and then refused to acknowledge that having the General Fund no longer fund Social Security means that SS won't be able to make it's payments next month.
    All it has to do is fund it off payroll taxes, cashing in Treasury certificates and bonds as needed.


    Quote Originally Posted by cpwill View Post
    we've continually spent the SS surplus every year until it finally flipped back in 2011. Presidents Johnson through Obama all bear culpability.
    What the General Fund owes SSA is just another Treasury obligation that has been incurred in the past right along with all the other debt.


    Quote Originally Posted by cpwill View Post
    That is incorrect, as I demonstrated ad-nauseum; you can have the worst returns in post-war history on an income that never exceeds 32,000 a year and then face back to back 2008-2009 style financial meltdowns as you retire and then make the worst decision possible at the worst time possible and you would still come out ahead of Social Security.
    Assuming some market average. I read the posts.


    Quote Originally Posted by cpwill View Post
    So perhaps you can enlighten us, Mo. What do you think happens when the General Fund loses the ability to fund the gap between Social Security revenues and payouts?
    What happens to the other debt obligations of the General Fund? Do government contractors yet to be paid lose their money? Are people that own other Treasury bonds not able to cash in?
    Last edited by MoSurveyor; 05-04-13 at 10:14 PM.
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  5. #405
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    Re: The divide between the rich and the rest

    It is interesting to note that as of now, of the more than one hundred people who participated in the poll, not one person voted that the divide does not exist.
    Last edited by Phys251; 05-11-13 at 03:10 PM.
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  6. #406
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    Re: The divide between the rich and the rest

    Quote Originally Posted by Phys251 View Post
    It is interesting to note that as of now, of the more than one hundred people who participated in the poll, not one person voted that the problem does not exist.
    Incorrect. Thirty-five people voted that no problem exists WRT the divide. Zero voted that there is no divide at all (because that'd be what we call a delusion).

  7. #407
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    Re: The divide between the rich and the rest

    Quote Originally Posted by Neomalthusian View Post
    Incorrect. Thirty-five people voted that no problem exists WRT the divide. Zero voted that there is no divide at all (because that'd be what we call a delusion).
    I see your point. Editing my post now.
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