The myth that a surplus during the Clinton administration was a myth.

[loosecannon]

Who gets to define "extremist"?

oddball = extremist. duh!

 

[edthecynic]

BUDGET SURPLUS!

there was indeed a budget surplus and that is undeniable.

Bush in 2001 used the budget surplus as a rationale for his tax cuts.

Not only that, the GOP are STILL taking credit for the Clinton surplus.

Here is Jeff Sessions crediting the GOP congress for the Clinton surplus on Face the nation last Sunday. What he leaves out is that same GOP congress with Clinton replaced by Bush ran up $500 billion deficits year after year!!!!

Face The Nation - CBS News

SENATOR AMY KLOBUCHAR: Democrats have made a lot of tough decisions, if you
look at the last two years. When President came in he inherited this debt that had grown and
grown and grown over the Bush years. When Bill Clinton left office the last time that we had a
surplus it was a Democratic President. So you have to look at the fact that Democrats have
made some tough decisions in the past. They got us into a balanced budget. And we can make
the tough decisions this time.
SENATOR JEFF SESSIONS: Well, Bob, Lindsey was there when the last budget was balanced.
He was there with Newt Gingrich.
BOB SCHIEFFER: Yeah.
SENATOR JEFF SESSIONS: And there was blood politically on the floor. People slept in their
offices. The government was shut down. Bill Clinton then claims credit for balancing the budget,
but people living there could see that was the Congress that made that happened in many
ways.

 

[Oddball]

It's far more than that. The entire society rather voluntarily subscribes to public fictions, like money, gravity, math, statistics, the authority of scientists and clergy, GOD. The moral distinction between war and cold blooded murder, the right of states to engage in violence, spy on citizens and keep secret from us that which we must know to vote as actual citizens in a democratic process.

Truth is I suspect that almost everything you believe is a public fiction. You just don't know it.

Your premise relies upon the fiction of "society" as tangible at the outset.

Try again.

No it doesn't, my premise relies on any any set of people whose lives intersect regardless of whether it is a family, tribe, clan, village, city, state, one man and one woman on an island etc.

In order to speak we depend on social fictions. In order to sell and honor bonds on a macro scale we rely on the same edifis, bonds and money; social fictions.

You're self-serving hallucination as to what constitutes the unquantifiable "society" is as irrelevant as your opinion as to what the mythical and royal "we" get out of it.

Keep swingin'.

 

[loosecannon]

Your premise relies upon the fiction of "society" as tangible at the outset.

Try again.

No it doesn't, my premise relies on any any set of people whose lives intersect regardless of whether it is a family, tribe, clan, village, city, state, one man and one woman on an island etc.

In order to speak we depend on social fictions. In order to sell and honor bonds on a macro scale we rely on the same edifis, bonds and money; social fictions.

You're self-serving hallucination as to what constitutes the unquantifiable "society" is as irrelevant as your opinion as to what the mythical and royal "we" get out of it.

Keep swingin'.

your use of the fictional terms "keep" and "swinging" betray the schizophrenic nature of your inner state.

Nuf sed, you lose, as usual.

 

[Oddball]

The surest sign of losing is self-declarations of victory.


Got a couple buckets of society you can lend me?.....I promise to pay you back at the end of the month with a truckload of it.

 

[loosecannon]

The surest sign of losing is self-declarations of victory.


Got a couple buckets of society you can lend me?.....I promise to pay you back at the end of the month with a truckload of it.

Sure. My bucket load of society is every bit as heavy as your bucket load of fiat currency, bond liabilities and rights to immortal wealth!

MGWWIT, your bucket load of public fictions isn't worth a warm shit. IYCTDOTBN I can arrange a camera crew to preserve it for pRosterity!

The surest sign of losing is self-declarations of victory.

Yeah you do that in every third post.

 

[Toro]

I explain above that looking at national debt is deceiving because national debt deals only with gross debt. The way the government accounts for its books, if there was economic growth and the government spent exactly zero dollars more than the year before, the national debt - which is gross debt - would still rise, all else being equal, because taxes flowing into the trusts automatically trigger buying of government securities. But the net debt would not rise because there would be a concurrent rise in asset value of the trusts, which are government agencies.

One would expect that when the government ran surpluses, there should at least be a slowing, if not an outright decline in the national net debt. Indeed, that is what happened. Net debt in the United States declined in the last years of the 1990s.

FRED Graph - FRED - St. Louis Fed[1][id]=NFDEBT&s[1][range]=5yrs

Even more pronounced was the decline in net debt to GDP.

Total Government Net Debt (% of GDP) for United States in year 2000 35.548
Total Government Net Debt (% of GDP) for United States in year 1999 40.412
Total Government Net Debt (% of GDP) for United States in year 1998 45.164
Total Government Net Debt (% of GDP) for United States in year 1997 49.072
Total Government Net Debt (% of GDP) for United States in year 1996 52.191
Total Government Net Debt (% of GDP) for United States in year 1995 54.105

United States Total Government Net Debt (% of GDP) data, Total Government Net Debt (% of GDP) United States

This is the number that really matters. In the same way that if you have a mortgage on your house and the value of your house rises causing loan-to-value of your house to fall, falling net debt to GDP is indicative of a strengthening fiscal position.

Unfortunately, net debt to GDP is expected to be 58% this year, and rise to 85% in 2015 if we don't get our house in order.

 

[uscitizen]

Sure...Under the laws written by that those who rely upon defining money that they don't have, and might possibly not ever have, as an "asset".

Nice work, if you can get it.

Umm it it pretty much how the finiancial industry works as well.

You might want to learn a bit about it.

I did not realize you were anti fininiancial industry as well?

 

[Trajan]

Yep, why they want to know your job status and income, etc.

Those are unsecured loans.

This is relevant how?

Pension funds buy government debt and hold them as assets. Banks buy government debt and hold them as assets. Insurance companies buy government debt and hold them as assets. Individuals buy government debt and hold them as assets. The social security trusts buy government debt and hold them as assets. What's the problem?

I do have to say that I KNOW its the system but a corrupted system rigged so as take money from the left hand pocket, put in the right, spend it, then put a piece paper back in the left saying I owe myself ex-amount of dollars and I'll pay myself back in real dollars buy printing money or taking more back from my 'employees'......this thing was due for a catastrophe from day one.

 

[Toro]

Those are unsecured loans.

This is relevant how?

Pension funds buy government debt and hold them as assets. Banks buy government debt and hold them as assets. Insurance companies buy government debt and hold them as assets. Individuals buy government debt and hold them as assets. The social security trusts buy government debt and hold them as assets. What's the problem?

I do have to say that I KNOW its the system but a corrupted system rigged so as take money from the left hand pocket, put in the right, spend it, then put a piece paper back in the left saying I owe myself ex-amount of dollars and I'll pay myself back in real dollars buy printing money or taking more back from my 'employees'......this thing was due for a catastrophe from day one.

You have a pension. X% of your net income goes into your pension. That money is then invested for you. It is invested in government bonds, corporate bonds, mortgages, US stocks, foreign stocks, real estate, private equity, etc. When you retire, you draw on your pension, which is a combination of the money you put in plus returns on capital.

Social security is no different, other than the only thing that it invests in are nonmarketable government bonds. Your payroll taxes are used to purchase securities which earn interest. When you retire, you draw on your social security, which is a combination of the money you put in plus interest on the bonds purchased.

If SS were a "real" pension fund that invested only in government bonds, payroll taxes would come into the trust, then the trust would go out into the market and buy marketable government bonds, which would then be held in the trust.

People have difficulty wrapping their minds around this concept. What is currently in the SS trusts are promissory notes from the government, i.e. "IOUs." It is a promise by the government to make whole the obligations of the SS trust. But an actual Treasury bond is also just a promissory note. It is a promise by the government to make your loan to the government whole. The difference between SS and a "real" pension fund is that SS cuts out the middleman. It doesn't tap the market.

Now, I think this is not a good system, least of all is because it confuses otherwise smart people. More importantly, government bonds are considered "safe" and politicians don't want to be seen as doing anything other than "safe." But that's a mis-characterization because the interest earned in the trust over time is 3%-6% whereas a "real" pension fund invested across a broad spectrum of investments earns 6%-10%. And that difference in compound interest over time is enormous.

 

[Synthaholic]

i agree with you, and have also posted CBO as my source...and yes, the budget has been greatly misunderstood....and it is simply not true that Clinton did not have a surplus when measured by the same means every president has been measured on balancing the budget....because he DID have a surplus according to those measures.

He, along with his Congress....reduced the huge deficit he inherited, every year he was in office...

The CBO, the official bipartisan agency in Congress reporting on the budget (and that many conservatives have referred to frequently regarding the current budget) reports there were surpluses. And the total debt decreases by over $100 billion in Clinton's last year.

Yet I hear over and over that the surplus was a "myth". So I don't get where the claim there was no "surplus" comes from, other than Murdoch outlets I mean.

Thus this thread.

So far, none of the several people that claimed the surplus was a "myth" which has been according to some proved over and over here have shown up. It's telling.

oh, you will get a response, from divecon and diamond dave for certain! patience is a virtue!

they just are not online now....!

they honestly believe that clinton didn't have a surplus based on opinions which they have read on the subject, so i don't think you will get far with them on this!!!! hahahahaha!
....even with the OMB statistics... I don't know what else to tell ya, except that someday, it may sink in with them...???

Because I believe, that they believe, they are being honest on the subject, I usually just agree to disagree on the subject....but that's just me....it took a bit of arguing and debating the subject before i resided to this position and have just resorted to praying that they will see the truth someday!

Good luck on your part though....maybe you will succeed?

Care

Care4All,

I find that these conversations do not go well for rightwingers, and in the end, they are left grasping, saying "well.....if there was a surplus, it was a Republican Congress who created the surplus".

You watch!

 

[loosecannon]

People have difficulty wrapping their minds around this concept. What is currently in the SS trusts are promissory notes from the government, i.e. "IOUs." It is a promise by the government to make whole the obligations of the SS trust. But an actual Treasury bond is also just a promissory note. It is a promise by the government to make your loan to the government whole. The difference between SS and a "real" pension fund is that SS cuts out the middleman. It doesn't tap the market.

Now, I think this is not a good system, least of all is because it confuses otherwise smart people. More importantly, government bonds are considered "safe" and politicians don't want to be seen as doing anything other than "safe." But that's a mis-characterization because the interest earned in the trust over time is 3%-6% whereas a "real" pension fund invested across a broad spectrum of investments earns 6%-10%. And that difference in compound interest over time is enormous.

But there are at least 3 significant reasons why they do it that way instead of buying secondary market bonds and holding a diverse portfolio.

I agree that SS returns are a pittance of what they would be if they were managed according to industry standards, but there is more involved in the calculus than just simple risk and ROI.

All things considered the current SS pension system sucks. But really, what is the alternative?

I always thought that our currency should be backed by the value of our land and that using mortgages as a securitization mechanism to ballast our currency and perhaps bonds was the appropriate way to go. We would always be borrowing and printing against the value of something real.

But we don't make these decisions to be practical, we make them for political convenience. Or to enrich bankers.

 

[Toro]

But there are at least 3 significant reasons why they do it that way instead of buying secondary market bonds and holding a diverse portfolio.

I agree that SS returns are a pittance of what they would be if they were managed according to industry standards, but there is more involved in the calculus than just simple risk and ROI.

All things considered the current SS pension system sucks. But really, what is the alternative?

I think the alternative is to run it like a real pension fund. Other countries do that. States do that with their employees (and you wouldn't have the problems with contributions that the states have, which leads to underfunding, because SS is entirely funded by individuals). The problem with it is that greedy, scummy, venal politicians may try to use it to enhance their re-election chances or push pet political causes at the expense of participants.

Trajan called SS a rigged scheme. I disagree with that. However, I do agree that because the securities are more esoteric and intangible in nature, it would be much easier to default on the securities in the trusts. If the US government defaulted on its marketable bonds outstanding, the dollar would collapse because people hold those bonds in their accounts. However, nobody holds the special-issue SS trust bonds. The government would essentially be defaulting against itself. Heck, if the government did "default" against the SS trust, the dollar would probably go up.

I'm just speculating, but my guess is that one reason why the current SS system has nonmarketable bonds that are not marked-to-market is because of the large hits the system took in the early 80s due to capital losses in bonds after interest rates spiked. It is another example of the government not living by the same standards it requires others to live by.

 

[Toro]

Some are confused about what occurred in the late 90s regarding the budgetary surplus and the national debt. Some have argued that there was no surplus because national debt rose in the final years of the Clinton Presidency. As has been demonstrated, this characterization is incorrect. The budget balance is the difference between government revenues and spending, nothing more. It does not include changes in the national debt.

Thus, the question is why did the national debt rise even though there was a surplus? And the next question is it a bad thing? The answers may surprise some people.

Why did the national debt rise when there was a surplus?

Counter-intuitively, the reason why the national debt rose was because the economy was doing well. When the economy is doing better than expected, payroll taxes flowing into the SS trust funds are greater than expected. The SS trust funds can only "buy" special issuance nonmarketable government bonds. Thus, when payroll tax revenues are greater than expected, issuance of these special issuance government bonds rises and the national debt rises. Likewise, when the economy is doing poorly, payroll tax inflows are less than expected. The amount of funds in the SS trusts is lower, the SS trusts buy fewer special-issue government bonds and the national debt is less than expected.

Understand, though, that this is merely an accounting function. It affects assets and liabilities of the government and trust fund recipients. It does not affect cash flows, and thus does not affect the budgetary balance.


So was rise in the national debt a bad thing?

It is true that in the last half of the 1990s, total government debt rose. But did it negatively affect the balance sheet of the United States government? In other words, was the rise in the national debt during the last 1990s a bad thing?

To help us understand this question, it is best to use an example.

Let us say that in the first year, the government has total debt of $1,000, including $100 of debt in the social security trust. This is the breakdown of the government’s debt.

Total government debt, year 1
Social security debt -$100
All other government debt -$900
Total government debt -$1,000​

Now, let’s say that in the second year, the government runs a $20 surplus and payroll taxes are $30 all of which go into the SS trusts. Payroll taxes are used to buy government debt in the SS trusts and the surplus is used to pay down other government debt. There is no change in any other debt. The breakdown of the government’s total debt is as follows.

Total government debt, year 2
Social security debt -$130
All other government debt -$880
Total government debt -$1,100​

The debt has gone up even though the government has run a surplus.

This is bad, right?

In this case, no.

Why?

Because we are only looking at one side of the balance sheet.

What the critics fail to recognize is that they are looking only at gross debt.

What matters is not gross debt but net debt, which is total debt less total assets.

Critics who decry the government’s total national debt rising in the last years under Clinton are only looking at total debt, not net debt. This is intellectually flawed. An analogy would be to look only at mortgage debt when assessing an individual's financial health without looking at the value of the house. According to the critics, if you take out a $200,000 mortgage, that’s bad. But it is not bad if the value of your house is $300,000.

It works the same way for the social security trusts. This is what the critics omit.

If you earn $100 and you buy a government bond for $100, your assets now include a government bonds worth $100. The SS trusts do the same thing. Money comes in and they buy bonds from the government.

Let’s look at our example again. Let’s say that in the first year, the government has assets worth $400. The SS trusts are government agencies, and government debt in the SS trust funds is an asset of the SS trust fund. Since the government has $100 in debt outstanding issued to the SS trusts, the SS trusts now have assets worth $100. Thus, the balance sheet of the government looks like this.

Government debt issued to the SS trusts is an asset of the SS trusts. The SS trusts are essentially buying government bonds. If you buy a government bond for $100, you now own a government bond. The SS trusts effectively do the same thing

Total government debt, year 1
Social security debt -$100
All other government debt -$900
Total government debt -$1,000

Total government assets, year 1
Debt issued by the government to the SS trusts $100
All other government assets $300
Total government assets $400

Net government debt, year 1 -$600​

Net debt is total debt less total assets. In this case $1,000 in government debt less $400 in government assets means the government’s net debt is -$600.

It is no different than you owning your house. If you own your house, your balance sheet looks like this.

House $300,000
Less: Mortgage -$200,000
Net equity $100,000​

We do the same thing for the government. What matters is not gross debt but net debt.

Now, let’s look at the example above in year 2, where the government runs a $20 surplus with $30 in payroll taxes, which go directly into buying government debt in the SS trusts. The balance sheet of the government would look like this.

Total government debt, year 2
Social security debt -$130
All other government debt -$880
Total government debt -$1,100

Total government assets, year 2
Debt issued by the government to the SS trusts $130
All other government assets $300
Total government assets $430

Net government debt, year 2 -$580​

As you can see, even though total debt rises, because there is a budgetary surplus, net debt declines when there is a surplus because the value of assets rises.

When one is assessing the fiscal health of the government, one must look at net debt, not total debt. This is what the conservative critics fail to understand.

I apologize. I found a typo. I originally wrote

Total government debt, year 2
Social security debt -$130
All other government debt -$880
Total government debt -$1,100​

It should be

Total government debt, year 2
Social security debt -$130
All other government debt -$880
Total government debt -$1,010​

 

[Toro]

I'm using this thread as a repository so I can refer to this argument in the future when it pops up again.

Mr. Clinton's plan is based on the idea that by using the Social Security surplus to pay down the national debt, the Government's interest bill will decline substantially.

By the White House's estimate, the Government's interest expense will be $107 billion lower in 2011 than it would be if the Social Security surplus were not used, starting this year, to reduce the debt. Mr. Clinton's proposal would take the money saved because of the lower amount of debt, starting in 2011, and earmark it to shore up Social Security.
Source: CLINTON ABANDONS IDEA OF INVESTING RETIREMENT FUNDS - NYTimes.com

Remember when you said that

This despicable gimmick used by the White House and Congress to cover up the huge federal budget deficit was the looting of the Social Security Trust Fund, Medicaid, Civil Service and military retirements funds[1]. This money may very well not be available to many of us when we grow old.

And I said

Its not a despicable gimmick because its not a gimmick at all. It is how all cash flows into and out the SS trusts have been accounted for since the early 1980s when the government revamped the operations of the SS trusts.

From your link.

Both parties routinely agreed for decades to spend excess Social Security payroll tax revenues on general Government operations.

This is how its been done for decades, since at least when SS was revamped in the early 1980s.

Now, to get to your point, which I think you've mis-understood, and I don't blame you, because it is very unclear in the article to which you've reference.

First, on the very next line of the article

But this year the two parties have both pledged to balance the budget without using any of the Social Security money, and they have been trading bitter accusations about the inability of the other to show how to do it.

What happens every year, as has happened for many years, is that money comes into the fund then money goes out and is spent, as I explained above

How SS really operates

* ----------> Payroll taxes come into the Treasury
* The government issues nonmarketable bonds to the SS trusts in the amount of the cash coming into the Treasury
* The government spends the money from payroll taxes
* The government credits interest payments to the SS trusts
* <---------- SS payments are paid out and the SS trusts are debited that amount.

What they are talking about is the excess money coming into SS. So, for example, as I explained

Total social security cash receipts in the fiscal year was $620 billion. Total social security cash outlays was $442 billion.

the total excess is $178 billion. This is what they were arguing about.

But as mentioned in the NY Times article you linked, the government had been doing this for decades. This isn't the Clinton administration resorting to despicable accounting gimmicks. This is business as usual in Washington.

Now, I agree that it would have been better to have not spent that money. It would have been better if they invested the $178 billion. It would have improved the balance sheet of the United States. But it isn't a raid. In FY 2000, the SS trusts would have bought a net of $178 billion in nonmarketable special-issue securities. That doesn't change. What would have changed had the money not been spent would have been the balance sheet of the US Treasury, which would have made the US government better off. But it wouldn't have affected the SS trusts, other than if the funds had been held as collateral off balance sheet of the trusts.


Here is what the incremental SS trusts balance sheet would have looked like in 2000

Debit: $620 billion in nonmarketable special-issue government bonds issued to the SS trusts
Credit: -$442 billion in disbursements and outlays
Net change in the net asset value of the SS trusts: +$178 billion.

And here is what the US Treasury's balance sheet would have looked like

Credit: -$620 billion in nonmarketable special-issue government bonds issued to the SS trusts
Net change in the net asset value of the US Treasury: -$620 billion.


Now here is what the incremental SS trusts balance sheet would have looked like in 2000 had the $178 billion not been spent

Debit: $620 billion in nonmarketable special-issue government bonds issued to the SS trusts
Credit: -$442 billion in disbursements and outlays
Net change in the net asset value of the SS trusts: +$178 billion.

And here is what the US Treasury's balance sheet would have looked like had the $178 billion not been spent

Debit: +$178 billion not spent by the government and instead invested
Credit: -$620 billion in nonmarketable special-issue government bonds issued to the SS trusts
Net change in the net asset value of the US Treasury: -$442 billion.

The US government would have been $178 billion better off had it not spent the surplus. But the SS trusts would not have been better off, at least not from an accounting stand-point.

The real-world caveat to this is that the SS trusts would have been better off because the government would have pledged the $178 billion as collateral to back up the SS trusts. And that's a good thing. Investing rather than spending almost always makes a balance sheet stronger, no matter if you're the government, a person, a company, etc.

But again, understand this - there can be no "raid" on social security because there is no cash in the fund. The only securities held in the funds are nonmarketable, special-issue government bonds that can only be credited and debited by the government. It's not like there is $1 trillion of cash sitting there. There are no marketable government bonds in the fund that can be sold. Nothing in the fund can be sold. Thus, nothing can be raided and taken out.

When the government talks about the "surplus," what they are talking about is that excess. That is what the CBO is talking about in your next link.

But to go back to your NY Times link where it says

Mr. Clinton's plan is based on the idea that by using the Social Security surplus to pay down the national debt, the Government's interest bill will decline substantially.

By the White House's estimate, the Government's interest expense will be $107 billion lower in 2011 than it would be if the Social Security surplus were not used, starting this year, to reduce the debt. Mr. Clinton's proposal would take the money saved because of the lower amount of debt, starting in 2011, and earmark it to shore up Social Security.

This again is confusing, and I can see how it gives the impression that there is this pile of money that the government can raid. But there is not.

What the article is referring to is on the first page, where it says

President Clinton dropped one of the most contentious elements of his plan for bolstering Social Security's finances today, and called on Congress to break the partisan deadlock over how to prepare the retirement system for the aging of the baby boom generation.

In his weekly radio address, Mr. Clinton said he would send Congress legislation next week based on a proposal he first floated earlier this year to shore up Social Security with projected Federal budget surpluses. But the new version will not include Mr. Clinton's longstanding call for the Government to invest some Social Security taxes in the stock market. ...

In a signal of his desire for bipartisan cooperation, White House officials said Mr. Clinton was withdrawing for now his plan to seek higher returns for the system by having the Government invest as much as 15 percent of Social Security's reserves in the stock market.

First, understand what a pension fund does. It makes investments to earn a return to pay benefits in the future. The higher the return of the plan assets, either 1.) the more money that can be paid out in the end, and/or 2.) the less amount that must be contributed to meet the same amount of benefits in the future.

So, what Clinton proposed was that the SS trusts invest in the stock market and earn a higher return (over time) in the future. A higher return means that the fund will be worth more in the future. To meet the same future benefit claims, the government could lower the taxes paid into the SS trust, but what Clinton was arguing was to use the excess, i.e. the surplus, the $178 billion, to pay down the national debt. In other words, as returns in the trust rose over time, instead of lowering contributions, i.e. payroll taxes, he was going to keep payroll taxes the same and use that money to pay off debt.

Here's an example.

Let's say you want to retire in 10 years, and you decide to put away $10,000 a year for the next 10 years. You have two options, you can invest in government bonds that earn 3% a year or stocks that earn 10% a year. In the first option earning 3%, at the end of 10 years, you will have $128,000 in the bank. At the end of 10 years using the second option of earning 10%, you will have $185,000 in the bank.

But let's say you only need $128,000 at the end of 10 years. If you decide to go with option 2 and earn 10% a year, you don't need to put $10,000 away. In fact, you only have to put $6500 away each year to earn $128,000 at 10% in 10 years. Now let's say you also have a debt of $20,000. You can pay that off in 10 years by investing $6500 at 10% and applying the $3500 to pay off the debt. Now, you could save $6500 a year and spend the extra $3500, but you'd still have a debt of $20,000 (plus interest) at the end of the decade.

That is what Clinton was proposing. What Clinton was proposing was to use taxes intended for SS to pay down the marketable debt while investing in assets that earn a higher return so the government could afford to take SS taxes and pay off the national debt. He was proposing to take that $10,000 and invest it in stocks so it could a higher return and have some left over to pay down debt. That's not underhanded. That's smart.

It's confusing, I know, but there wasn't anything untoward going on in the 1990s. But people don't understand how this works and make false conclusions.

 

[loosecannon]

"I'm just speculating, but my guess is that one reason why the current SS system has nonmarketable bonds that are not marked-to-market is because of the large hits the system took in the early 80s due to capital losses in bonds after interest rates spiked. It is another example of the government not living by the same standards it requires others to live by."

I agree, and I can think of several more reasons. I expect a series of SS defaults triggered by a sudden inability to service our debt by rolling it over. Austerity is coming. Bar the doors!