If You Are A Baby Boomer - the real reason YOU SHOULD BE FURIOUS over CPI cuts:

[customerserviceguy]

143. Sorry it took me a few days

but I do have some answers to your questions.

Boomer SS contributions do NOT represent deferred gratification. When I stick money in my 401K (presuming Vanguard doesn't go up in flames, like Madoff Investments did), that's deferred gratification. When I stick a pricey bottle of wine away in my tiny 'cellar' under the last row of stairs in our one-bedroom townhouse to age for several years before drinking it, that's delayed gratification. When my FICA taxes went straight into the Social Security checks of their recipients for the last forty years, that's not delayed gratification. One cannot save a bottle of wine and drink that bottle at the same time.

Also, the idea of delayed gratification involves a person weighing their choices. FICA tax wasn't a choice.

How do you get that FICA taxes 'helped keep other taxes low'? Being as the money that is taxed as FICA taxes is ALSO taxed with income taxes (double taxation if ever I've seen it) that doesn't make sense. And yes, money from boomers' taxes of all kinds did build infrastructure, but what's that got to do with your argument?

Social Security gets specialized Treasury securities, that are not tradeable on the open market. If I have a T-bill with an interest rate paying say, 3%, I would be able to sell it at a profit over face value if interest rates drop to 1%, or I would have to take a loss on face value if rates went to 5%. While it wouldn't be fun to take a loss, at least I could sell that T-bill to a willing buyer for a market price, and get most of my money back if I so desired. The Social Security notes can only be redeemed at the will of Congress. I think that's one of the reasons Bernie Sanders himself referred to them as IOU's, which are not terribly negotiable.

Yes, the full faith and credit of the Federal Government is supposedly all behind this, but what happens when the investing class starts to lose that faith? At one point, they all believed that the fairy-dust securities that led to the economic collapse of 2008 were worth something, too. Investors are remarkably irrationally exuberant about things one day, and sour as hell on them the next. That's how bubbles are created and then burst.

You seem to think that some mechanism is in place to "punish" politicians who fail to keep the Social Security checks flowing. I don't see what that mechanism is. Most who borrowed from the excess of FICA taxes over Social Security benefits checks for decades are long gone out of Congress, and many are dead. We can, I suppose, kick out the rest of them, but then we'd be left with a Congress that didn't create the problem, yet still have to deal with it.

Tossing Bernie Madoff in the slammer didn't repay his investors one dime beyond the pittance that they had to pay lawyers to scrap over from the fire sale of all of his worldly possessions. He didn't just take the money, he manufactured an illusion of its very existence. I could contract with you to provide you a unicorn for $10,000 and you might be able to recover some of that money from me in a lawsuit, but the court is not going to compel anyone to create a unicorn for you.

You can go on and on about what is right and just, or what the duties of the politicians are to the American people, but in the end, it doesn't matter. We've been eating the seed corn, and just because our bellies have been full so far doesn't mean that we aren't screwed when it comes to planting season. The only thing that can possibly help is to enact comprehensive reforms which raise taxes (on everybody, not just the rich) and cut discretionary spending. Also, we have to figure out how to stop being the world's policeman and nation-builder for people who can't wait till we're gone to blow up everything we've built for them.

It will take some changes to entitlement program benefits to keep them going, as well. It's a multi-pronged approach that will need a true grand bargain, some sort of well-thought out piecing together of various parts to be able to stop shoving the burden on future generations. What we're doing now is the exact opposite of deferred gratification.