Politicians say SS will keep paying out 15, 20, 30 etc. years. But will it?

[Little-Acorn]

You know about the Social Security Trust Fund, right? And how it's empty?

They keep telling us it's got oodles of money in it, and that that money will let SS stay solvent for 15 years, 20 years, 22 years, etc., depending on which politician is talking today. But in fact, it's got nothing but government IOUs in it.

All the money was taken out and spent on other non-SS programs years ago. And since SS expenditures exceeded revenues a year or two back, no more money is flowing into the Trust Fund, except that which is immediately taken out and spent the next day. Part of the National Debt is money the govt has "borrowed" from the SS Trust Fund and other such Funds it maintains.

Debt to the Penny (Daily History Search Application)

Today the National Debt is about $17.5 trillion. Of that, $5 trillion is owed to the SS Trust Fund and other such funds. That's nearly 30% of the National Debt, owed to these Trust Funds.

That means that, in order for the SS Trust Fund and similar funds to actually keep paying what is owed to SS recipients, the money first has to be paid back into the Trust Funds by the government, and then paid out to SS recipients etc.

And if Social Security and the other programs are actually solvent and able to keep paying for the 20 years or whatever the current politicians are promising before it's emptied, that means that ALL the money owed to the trust funds, must be paid off within those 20 years, so it can be paid out to the recipients.

Have you heard of any plans by any of these politicians, to pay off nearly 30% of the National Debt within the next 20 years?

Neither have I.

They'll have to either balance the budget and start running a surplus, to pay off that 30% of the Debt, or they'll have to start borrowing a LOT more money from China or whomever is foolish enough to keep lending to someone who has no intention of ever paying it back. On top of the $trillions they've already borrowed.

Next time you hear some politician talk about how "solvent" Social Security is, ask him where the money is going to come from to pay off the recipients. Retirees who expect to draw out of SS the money they've been forced to pay in most of their lives. Drawing that money out of a Social Security Trust Fund that in fact is empty, except for a lot of government IOUs.

 

[g5000]

$2.7 trillion has been borrowed from the Social Security Trust Fund. That borrowed money has interest paid on it.

The solution to this problem is very simple, but no one has the balls to do what it takes because the cowards in Washington are too afraid to make the American people stop sucking on the government tit.

1) Raise the retirement age. Our ancestors set the Social Security eligibility age at 65. Their life expectancy at that time was 60. We descendants are living decades longer than they did. The average 65 year old today is in far superior health to the average 65 year old of 1935.

What's more, the physical labor force is much smaller today, and has much better machinery to accomplish the hard physical labor which our ancestors did.

The argument that raising the retirement age hurts the poor more than the wealthy was just as true in 1935 as it is today. Setting the retirement age at 65 in 1935 was harder on the poor than the wealthy, and yet that is what we did.

In 1935, 5.4% of the American population was over 65. Today, 13.1% of the American population is over 65. This speaks to the superior living conditions and health of Americans today. We are on our way toward tripling the Social Security load. The larger the percentage of Americans who are on Social Security, the smaller the percentage of Americans who are carrying them.

Simply put, we are living longer, so we should be working longer. This is just plain common sense.

The Social Security and Medicare eligibility ages should be raised to 70, and then indexed to 9 percent of the population going forward.

Period.


2) Ban all tax expenditures. Every tax credit, deduction, and exemption adds to the federal debt and causes tax rates to rise. Our tax expenditures now add up to $1.2 trillion a year.

Not per decade. Per year.

When the government gives away over a trillion dollars a year in this way, it has to take or borrow over a trillion dollars from other sources. That means higher tax rates for everyone, and heavy borrowing.

It does not take long to achieve a $17 trillion debt when you are spending $1.2 a year just on these giveaways alone. Before you build a single tank or ship, or pave a single road.

Tax expenditures are, by far, the biggest government tit in history. They dwarf Obamaphones and food stamps into insignificance.

Banning tax expenditures would have the added benefit of achieving instant campaign finance reform. If your politicians are forbidden from putting credits, deductions, and exemptions into the tax code, there is no point in bribing them to do so!

 

[Little-Acorn]

So, raise taxes and cut back services, and keep the whole program going and going ad infinitum?

No wonder people like Obama and Pelosi keep getting elected.

 

[PaintMyHouse]

Social Security is a Pay As You Go system. When we need more money, we will take in more money, to then pay out more money.

 

[g5000]

So, raise taxes and cut back services, and keep the whole program going and going ad infinitum?

No wonder people like Obama and Pelosi keep getting elected.

That is the Republican and Democratic plan. Not just the Democratic plan.

All of our politicians are gutless. Amazingly, though, Boehner openly speaks about raising the retirement age to 70 nowadays. So there is hope.

 

[g5000]

Four years ago: Top Republican: Raise Social Security's retirement age to 70

A Republican-held Congress might look to raise the retirement age to 70, House Minority Leader John Boehner (R-Ohio) suggested Monday.

Boehner, the top Republican lawmaker in the House, said raising the retirement age by five years, indexing benefits to the rate of inflation and means-testing benefits would make the massive entitlement program more solvent.


"We're all living a lot longer than anyone ever expected," Boehner said in a meeting with the editors of the Pittsburgh Tribune-Review. "And I think that raising the retirement age — going out 20 years, so you're not affecting anyone close to retirement — and eventually getting the retirement age to 70 is a step that needs to be taken."

He does not make nearly enough noise about this any more.

 

[JakeStarkey]

Politicians say SS will keep paying out 15, 20, 30 etc. years. But will it?

Sure, with some minor reforms and Congress to stop dumping it into the slush fund.

 

[dnsmith35]

Politicians say SS will keep paying out 15, 20, 30 etc. years. But will it?

Sure, with some minor reforms and Congress to stop dumping it into the slush fund.

I believe that the first thing we have to recognize is, all proceeds from FICA MUST be put into the general treasury such that interest, no matter how low the rate, can be paid to the trust fund. This a by law thing which has been going on for many years no matter which party is in power.

But the issue is not whether or not the government spends that excess of FICA collections, but rather that they OWE THE MONEY to the trust fund and it MUST BE AVAILABLE when the SS administration needs it to pay benefits.

Based on current FICA collections the trust fund will eventually become insolvent forcing benefits to drop, UNLESS we solve the funding problem soon enough to solve the problem.

In my opinion, the easiest and best way to make the fund solvent is to eliminate all caps on the income from which FICA is collected.

 

[ScienceRocks]

It better or there will be a blood bath on our streets.

 

[Little-Acorn]

Nothing has changed. The Social Security Trust Fund is still empty. Except the National Debt is now nearly 20 trillion dollars.

 

[Little-Acorn]

You know about the Social Security Trust Fund, right? And how it's empty?

They keep telling us it's got oodles of money in it, and that that money will let SS stay solvent for 15 years, 20 years, 22 years, etc., depending on which politician is talking today. But in fact, it's got nothing but government IOUs in it.

All the money was taken out and spent on other non-SS programs years ago. And since SS expenditures exceeded revenues a year or two back, no more money is flowing into the Trust Fund, except that which is immediately taken out and spent the next day. Part of the National Debt is money the govt has "borrowed" from the SS Trust Fund and other such Funds it maintains.

Debt to the Penny (Daily History Search Application)

Today the National Debt is nearly $20 trillion. Of that, nearly $7 trillion is owed to the SS Trust Fund and other such funds. That's nearly 30% of the National Debt, owed to these Trust Funds.

That means that, in order for the SS Trust Fund and similar funds to actually keep paying what is owed to SS recipients, the money first has to be paid back into the Trust Funds by the government, and then paid out to SS recipients etc.

And if Social Security and the other programs are actually solvent and able to keep paying for the 20 years or whatever the current politicians are promising before it's emptied, that means that ALL the money owed to the trust funds, must be paid off within those 20 years, so it can be paid out to the recipients.

Have you heard of any plans by any of these politicians, to pay off nearly 30% of the National Debt within the next 20 years?

Neither have I.

They'll have to either balance the budget and start running a surplus, to pay off that 30% of the Debt, or they'll have to start borrowing a LOT more money from China or whomever is foolish enough to keep lending to someone who has no intention of ever paying it back. On top of the $trillions they've already borrowed.

Next time you hear some politician talk about how "solvent" Social Security is, ask him where the money is going to come from to pay off the recipients. Retirees who expect to draw out of SS the money they've been forced to pay in most of their lives. Drawing that money out of a Social Security Trust Fund that in fact is empty, except for a lot of government IOUs.