$105 billion in lost SS revenues, $140 billion to the super-rich, $60 billion for UE. Great deal.

[Hannah Bell]

The payroll tax cut would put about $120 billion back in the pockets of workers and the unemployment benefits would cost about $60 billion, officials said. Continuing the lowered tax rates for the highest-earners, by contrast, would cost the government $700 billion in lost revenue over the next 10 years, according to budget analysts.

http://thecaucus.blogs.nytimes.com/2010/12/06/obama-congress-near-deal-on-tax-cuts/?partner=rss&emc=rss

The rich get the Bush tax cuts extended 2 years = $140 billion.

The unemployed get a 13-month extension = $60 billion.

2 percentage points are cut from SS collections for a year = a 16% cut in collections, = $101 billion from about 656 billion (net contributions 2008).

http://webcache.googleusercontent.com/search?q=cache:CAbF87_e0ZQJ:www.ssa.gov/pressoffice/pr/trustee08-pr.htm+social+security+revenues+2008&cd=2&hl=en&ct=clnk&gl=us

That should put SS into the red when it was forecast to be in the black = gift to the pubs.

what a fucked deal.

[dana_b]

1. when you put it like that, it's chilling

so in a year or two they'll be screaming about SS being in the red and we need to cut it in order to "save" it. This is disgusting. Nothing for the 99ers and people who have been off UI for ages, only 13 mos for those currently on it and at least 2 years for the rich. I am sick to my stomach.

[Locrian]

2. nice huh

>>That should put SS into the red when it was forecast to be in the black = gift to the pubs.

Another little trap to fuck ss. Nice plan fuckwads.


Can it get any worse? EVERY FUCKING "deal" is a sellout. We could do NOTHING and it would be better.

[Poboy]

7. Our OWN party and fucking president is ACTIVELY fighting against us!

[Sherman A1]

3. I am disgusted with this deal

:puke:

[BzaDem]

4. Are you sure they won't be putting money from the general fund into the trust fund to compensate?

I haven't heard one way or the other, so I have no idea. Do you have a source indicating that they are not doing so?

[Hannah Bell]

6. compensate for lost SS money? you don't get it. it's about increasing the pressure to cut benefits

raise the retirement age, change the funding formula, etc.

it doesn't matter if they take money from the general fund if it's in the red next year. The fact that they have to is the weapon they want.

[BzaDem]

8. But if they did, that would contradict your statement that SS would go into the red more quickly. nt

[Hannah Bell]

17. no, it wouldn't. it would be in the red next year, & the longer-term actuarial picture would also

take a hit.

[BzaDem]

19. If they don't touch the SS trust fund, it will not go into the red more quickly than it otherwise

would. This isn't that hard -- it is literally by definition.

[Jim Lane]

23. Yes, it will. The current receipts minus current expenses number will go down.

If the number would otherwise have been positive, then this change will reduce or eliminate what would have been next year's contribution to the trust fund, so the trust fund will be that much closer to depletion (closer than it otherwise would have been). (It's a virtual certainty that current expenses will exceed current income by the end of the 2020's, so the SSA will be drawing down the trust fund. The more the trust fund is built up before then, the lesser the danger that it will be completely depleted at some point.)

If the number (next year's receipts minus expenses) would otherwise have been negative, then this change will make it even more negative, and the drawdown on the trust fund will be greater than it otherwise would have been.

[BzaDem]

25. No, because the federal government is writing a giant check from the treasury to the trust fund

in the amount equal to the payroll tax cut. To the penny.

[Hannah Bell]

28. the government, if SS revenues are insufficient to cover outgo, will buy back part of the Trust Fund

as it IS OBLIGATED TO DO BY LAW.

And it's beside the point. The point is that they have defunded next years' SS revenues by about 32%, which blows the actuarials out of the water.

[BzaDem]

39. No. The government will write a check for the full 120 billion to the trust fund, REGARDLESS if the

revenues are insufficient to cover outgo. The only difference is the source of the funds, not the amount of the funds.

[Selatius]

41. The problem is the source of the funds are now more subject to political pressure.

Taking money from the General Fund and covering the tax holiday, on its own, is an exceptional event, but I say "on its own" with reason. If it can be done repeatedly by more right leaning Congresses in the future, then it becomes not an exceptional event but a precedent setting one in terms of making Social Security funding more subject to the whims of whoever runs Congress.

FDR decided to fund SS with the payroll tax, against the advice of many of his economists that it was regressive, because he argued in the meetings that if it were dependent upon the General Fund to operate, then whenever Republicans got back into power, they'd simply de-fund what they don't want, Social Security.

Whether or not the Congress under Republican control will actually vote a bill in that will cover the shortfall in Social Security is the key question.

[Hannah Bell]

43. Since the Trust Fund is not "money," but DEBT, your belief is nonsensical.

I'm sorry you can't grasp the facts.

All excess Social Security revenues are borrowed into the general budget in exchange for SS securities. Securities are debt instruments -- IOUs, if you will.

So unless you think the gov is going to "write a check" to the TF & immediately borrow it back into the general fund, your belief is false.

And if they did such a thing, it would be idiotic.

[BzaDem]

46. "And if they did such a thing, it would be idiotic."

Just because you think something would be idiotic doesn't mean that it isn't true. The VALUE of the assets in the trust fund is not going to change ONE DIME by this proposal, no matter how much you otherwise.

[Hannah Bell]

48. if that's so, why didn't the gov just cut checks directly for the equivalent amount?

you have no idea what they're doing.

[Hannah Bell]

24. it's hard for you, evidentally, because your post is nonsensical.

[TBF]

22. Do you have a source indicating that they are doing so?

Now you're just making shit up.

[BzaDem]

26. Yes, I do.

http://tpmdc.talkingpointsmemo.com/2010/12/unhappy-dems-mull-obama-gop-tax-cut-deal.php?ref=fpa

"But officials tonight insisted that its cost to the Social Security trust fund will be reimbursed with a credit from general revenue."

[Hannah Bell]

31. i.e. They will take money from the general budget & cash out some of the SS securities.

It is totally irrelevant to the point, which is that a 32% 1-year decline in revenues puts SS income/outgo in the red next year & BLOWS UP THE ACTUARIAL PICTURE.

[Greyhound]

30. Yes.

:rofl:

[Ruby the Liberal]

5. Gee, whatever will I do with that additional $26 a week?

I guess I'll use it to save for retirement.

:eyes:

[mistertrickster]

9. It's time to organize against Obama.

We need to set up "Obama-villes" in DC of thousands of unemployed like they did to Hoover.

This guy is killing the country and killing our party.

[Poboy]

12. "This guy is killing the country and killing our party"

Yes he is. The breadth and magnitude of betrayal is stunning.

[WinkyDink]

10. There certainly was no "COMpromise."

[Mimosa]

11. This strategy was exactly what I feared from President McCain

BTW, Sen. McCain loves this deal!

[sasha031]

13. kick

:kick:

[NorthCarolina]

14. K&R

[sasha031]

15. I can't believe he's doing this

who is this guy I voted for

[Starry Messenger]

16. recommend.

[pa28]

18. Good interpretation on the Social Security "tax holiday".

Obama is already on the record for making changes to SS so the idea of cutting FICA seemed like an odd idea.

I'd like to have more confidence in the motives of the President, I really would, but the Republicans are apparently in agreement with him on this approach.

Most likely this is a trojan horse for a bipartisan attack on SS in the next Congress.

[dreamnightwind]

45. Exactly the way I see it

they're establishing the context that will enable the desired "reforms" to SS. Both Obama and the Repubs are working together to this end, IMO.

[toddwv]

20. How the hell is that even remotely considered a compromise?

That's very clearly capitulation.

[amborin]

21. K&R

[Greyhound]

27. Who could possibly have predicted this 14th level Jedi Master chess move!

:kick: & R
:rofl:

[neverforget]

29. The next hostage taken by the Republicans will be the budget. Can't wait to see

what gets cut in the deal for a budget.......Hostage taking worked this time for Republicans and it'll work again.

[Hannah Bell]

32. yep.

[mmonk]

33. Could you lay out the math a little clearer?

Will it be 16% or 32% cut in ss collections?

[Hannah Bell]

35. They're cutting 2 points.

From an individual's check that's 6.25% - 2.0% = 4.0%. 2 = 32% of 6.25.

From total payments of 12.5% of wage income (employee & employers' share) it's 16%.

I was so ticked off I think I threw in 32% in some post without thinking, I'll change it if you'll point me to the post -- i can't find it.

[mmonk]

36. Got it.

You mean 6.25-2.0=4.25%

[Hannah Bell]

38. The cut in SS revenues -- what goes to pay beneficiaries -- will be 16% of revenues.

[mmonk]

40. Right. Because of the employer match.

[BzaDem]

37. And every dime of that is getting put back in the trust fund. To you, apparently the routing number

of the check of exactly the same amount affects the solvency of social security.

:shrug:

[Hannah Bell]

42. You apparently don't understand the system.

The "Trust Fund" has no "money" in it.

The $2.5 trillion in the Trust Fund is securities representing the $2.5 trillion that the government HAS ALREADY BORROWED FROM WORKERS AND PUT INTO THE GENERAL BUDGET.

The government is not going to "cut a check" & put money into the Trust Fund. If collections aren't sufficient to pay for SS checks next year, they're going to redeem some SS securities by taking INCOME TAX MONEY & using it to pay SS checks.

There's nothing wrong with that in principle; it's the way it's supposed to work. What's wrong is:

1. SS revenues next year will be 16% less than predicted; enough that collections < payouts. This will put SS collections in the red next year where they were forecast to be in the black.

2. That changes the long-term actuarial forecast for SS as well, bringing forecasted Trust Fund depletion closer.

3. That gives weapons to those who wish to "fix" it.

4. The need to put an unexpected (e.g.) $100 billion from general budget revenues into Social Security checks next year also gives weapons to the defunders & austerity men. It takes money from other uses.

$100 billion is about 23% of total federal discretionary spending.



I'm terribly sorry you can't grasp the facts.

[BzaDem]

47. No, it is YOU that does not understand how it works.

SS revenues will not be 16% less, just because the SOURCE of the revenues is now from the general fund rather than businesses collecting the tax.

Just because you claim it would be idiotic for the government to put money in the trust fund and then borrow it back does not mean that isn't what is going to happen.

[Hannah Bell]

49. then why didn't they cut checks directly from the general fund?

you have no clue what they're doing.

just a desire to spin whatever they do in the best possible light.

[zeos3]

34. KICK Agreed!

[progressoid]

44. Oh, c'mon, it was a reasonable compromise.

Shit, I won't even bother with the sarcasm thingy.

[unkachuck]

50. this is unbelieveable....

....thanks, Hannah Bell!