How does taking $100 billion out of the Social Security fund help decrease the deficit??

[kentuck]

If we start with the fact that the deficit would be even larger if they were not borrowing from the Social Security fund, then how does decreasing the SS fund decrease the deficit??

If the Social Security fund were put in a "lockbox" where the government could not "borrow" it, they would have to borrow even more from the Chinese. So where is the Social Security fund the problem? How does it relate to the deficit in any way?

If the politicians do not wish to borrow from the people's Social Security trust fund, then they should resist the urge. The fund is perfectly healthy as is. It is the insurance program for all Americans. There may be millionaires today that might be destitute when they reach 66 years old? The Social Security fund is for them also. It is for everyone.

It can be destroyed. Not by borrowing from it but by not paying into it. Shrink it and eventually it will have to be cut back. Democrats should never agree to such a bargain. Neither moderates nor liberals should agree to such a pact. We should stand together on this principle.

[doc03]

1. I think you are a few days late on that one n/t

[kentuck]

2. No doubt.

I am always late.

[dkf]

3. Didn't we stop generating a surplus already?

[TheWraith]

5. No, not until 2017 or thereabouts.

That's when payouts will outpace payroll taxes. Though due to interest on the bonds in the trust fund, it will continue to grow until 2025.

[dkf]

11. Nope, we hit it this year thanks to decreased revenue and early retirement.

http://www.nytimes.com/2010/03/25/business/economy/25social.html

[jtown1123]

17. but then we go back into surplus next year.

[Selatius]

23. It depends on economic activity. If the recovery is slow, maybe barely or not at all.

The chief actuary of SS said it himself when he said the problem was that there were fewer paychecks to tax than before and that more older folks than expected applied for benefits when they got kicked out of their jobs. If there is no significant job creation going on, we're still going to be in the red or just barely escaping it.

[kentuck]

21. That would be the funds for this year alone..

Not the entire SS trust fund.


<snip>
“When the level of the trust fund gets to zero, you have to cut benefits,” Alan Greenspan, architect of the plan to rescue the Social Security program the last time it got into trouble, in the early 1980s, said on Wednesday.

That episode was more dire because the fund could have fallen to zero in a matter of months. But partly because of steps taken in those years, and partly because of many years of robust economic growth, the latest projections show the program will not exhaust its funds until about 2037."

[TheWraith]

4. Where is anyone taking $100 billion out of the Social Security Trust Fund?

I assume that you're referring to the temporary decrease in the payroll tax, however that's a completely mistaken description. No one is taking money out of the trust fund--in fact, the government is paying INTO it, to make up for the money that's not being deposited in payroll taxes.

As for borrowing from the trust fund, what the trust fund contains is US government securities--federal debt, in other words. We're our own biggest creditor.

[kentuck]

6. A very important point you make..

"We're our own biggest creditor."

You are correct. We are our own biggest creditor, not the Chinese. There is a difference.

[Name removed]

7. Deleted message

Message removed by moderator. Click here to review the message board rules.

[TheWraith]

24. Thanks for showing you have no argument except screaming non-sequiturs and insults. nt

[no limit]

15. The problem is that the US treasury already has trouble paying back loans to social security

so forgive me if I don't buy the idea that they will pay this back.

[niceypoo]

25. Reagan called robbing SS 'excusable debt'

nt

[stray cat]

8. It's like unemployment money or a pay raise or food stamps -more money

[hobbit709]

9. Smoke and mirrors.

[Little Star]

10. What interest rate will the government be paying on this loan.....

from SS that they will pay back? Anyone know?

[unblock]

12. um, they're not taking anything out of the social security fund.

the payroll tax cut is being covered 100% out of general funds.

the problem comes down the road, when congress decides it can't afford to cover future payroll tax cuts nor can it bear raising them back to necessary levels.

[kentuck]

13. There is a difference..

When they have to borrow the money to pay SS benefits and when it is already paid for by the people in the form of FICA taxes. When it will need to be borrowed, they can cut it anytime they want, out of necessity. When the money is already there, it makes it much more difficult.

[unblock]

14. i agree. my point is that they haven't taken anything out yet.

we've merely started down a political road with an obvious conclusion.

[kentuck]

16. It does seem obvious...

It's mind-boggling that so few people see it.

[unblock]

18. republican strategists see it, i'm quite certain of that!

[kentuck]

19. Exactly right!

But Obama does not??

[unblock]

20. obama probably sees it as well, but has other goals

he's not there to defend social security at all costs.
nor is he there to get a democratic congress elected.

his top mission is getting himself re-elected, and i think he figures a democrat cutting taxes is a big win for him even if he doesn't like the particulars.

it's even possible that the social security issue will work in democrats' long-term favor. if republicans keep trying to destroy it, and if (*IF*) democrats position themselves as its protector, this could work well for us for a generation, the way certain red meat social issues have worked for republicans.

[niceypoo]

26. Obama is fighting a metastasizing economic cancer with Band-Aids

Band-Aids do nothing but temporarily mask the metastasizing problem

[kentuck]

27. Inch by inch...

he is fixing it. Pragmatically.

[fadedrose]

22. The other part of the plan

Us old people will be given a choice as to whether we want to be pushed off a cliff into the Grand Canyon or take poison pills. Bible says man is alloted 70 years - let's start paying attention to that Bible. Who's gonna argue with that? Solvency problem solved.

It'll be fun, you'll see. I can't wait.