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Social Security to Exhaust Funds in 2033

Hugo Drax

Diamond Member
Nov 20, 2011
5,649
47
91

Theb

Diamond Member
Feb 28, 2006
3,534
8
76
and what to do about them is a central issue in the election-year debate between Democrats and Republicans as President Barack Obama seeks a second term.
No, the central issue is pet care. Social Security is a distraction.
 

JTsyo

Lifer
Nov 18, 2007
10,908
214
106
That's counting what the government has borrowed from the funds?
 

boomerang

Lifer
Jun 19, 2000
18,897
638
126
Surely this can be put off for a while longer. Besides, I keep hearing that it's a Republican talking point and that there is a lot of money in there with no danger of running low.

What, me worry?
 

werepossum

Elite Member
Jul 10, 2006
29,876
460
126
Social Security has already run out of funds - it's now a net drain on the country. Social Security is projected to run out of its IOUs in 2033.
 

Fern

Elite Member
Super Moderator
Sep 30, 2003
26,917
173
106
It just means that the surplus will be gone. At that point retirees will have to rely on current SS contributions from those then working. I understand if this happens they can only receive about 75% of promised benefits.

However, the shortfall could be paid out of general funds.

Another problem is that the fed govt must come up with the money (i.e., issue more Treas bonds) to redeem those special SS bonds. I believe that's about $4 trillion more in borrowing.

Fern
 

Craig234

Lifer
May 1, 2006
38,584
345
126
If nothing is done SS will pay out 75-80% of benefits at the low point. That's not nothing.
 

classy

Lifer
Oct 12, 1999
15,219
1
81
The problem with SS has been, admins both Republican and Democrat have borrowed the fund into depletion. Clinton had cleared enough surplus to sure up SS in its present form and payout scale until like 2050. But then the wars and Bush came, the rest is history.
 

bradley

Diamond Member
Jan 9, 2000
3,671
2
81
Bill Clinton’s Phantom Surpluses Still Haunt Social Security
Investment Policy Magazine


For the second time in a decade, official Washington is spreading a bogus story about Social Security and the Federal budget. In the earlier version, the Clinton administration claimed four years of budget surpluses by pretending that the money the government borrows from the Social Security Trust Fund doesn’t count toward the Federal debt. “We are actually paying down the national debt,” Clinton boasted in his final State-Of-The-Union message in January 2000. “If we stay on this path, we can make America debt-free for the first time since Andrew Jackson was President in 1835.”

Of course there never was a surplus, nor a dollar of debt paid down. In fact, when the new administration and Congress took their seats a year later, the national debt was higher than five years earlier. Congress was soon asked to raise the legal debt limit, and it turned to the Congressional Research Service for an explanation. In June 2002 CRS produced a report with the comical title, “The Debt Limit: The Need to Raise It After Four Years of Surpluses.”

Government debt today, bloated by thirty years of deficit spending, $6 trillion of it during George W. Bush’s presidency alone, is far more troubling than it was in the Clinton years. But the bogus story circulating in Washington is similar. Changes in Social Security contributions and benefits, it is said, will help control future government deficits.

Officials like Alan Simpson, Republican co-chair of the President’s National Commission on Fiscal Responsibility and Reform, and Ben Bernanke, Chairman of the Federal Reserve System, are preparing the American people for adjustments to “entitlements,” notably Social Security and Medicare/Medicaid, that they claim will help reduce the Federal deficit.

They are right about Medicare/Medicaid; some 40% of its expenditures come out of general government revenues. Reducing medical spending will lower the deficit.

But they are wrong about Social Security. Every dollar of Social Security benefits is paid out of the Trust Fund, none out of general government revenues. The only result of raising the contribution rate or reducing benefits would be to increase the money in the Fund. It would not help the deficit at all. The government does not borrow for Social Security; it borrows from Social Security.

But myths die hard in Washington. Peter Orszag’s Office of Management and Budget still publishes historical data showing surpluses for fiscal years 1998 through 2001. And Erskine Bowles, who was Bill Clinton’s chief of staff during those years and now co-chairs the National Commission, is still praised for “orchestrating the first balanced budgets in nearly 30 years.”

If we hope to have an honest discussion of the best ways to attack today’s Federal debt, we need to bury the surplus myth – and its current version – once and for all.


Read the rest here....
http://investmentpolicy.com/2010/06/18/bill-clintons-phantom-surpluses-still-haunt-social-security/
 

Svnla

Lifer
Nov 10, 2003
17,722
1,263
126
Last edited:

MustISO

Lifer
Oct 9, 1999
11,929
12
81
I'd like a lump sum check for all of the money I've been putting in for the last 25 years.
 

First

Lifer
Jun 3, 2002
10,530
271
136
It's pretty straight forward; T-bills would be redeemed and paid out in the form of SS checks, and there are a shit-ton of them stocked up and ready to go for decades. This isn't imaginary, it exists as much as U.S. cash exists in your hands. It's money, it's a surplus and it isn't particularly difficult to understand.
 

xBiffx

Diamond Member
Aug 22, 2011
8,232
2
0
Just for the lol since obviously this has nothing to do with just this president:

 

IGBT

Lifer
Jul 16, 2001
17,706
49
91
social security has been a "book entry" for decades. There is no physical SS fund.
 

DucatiMonster696

Diamond Member
Aug 13, 2009
4,269
1
71
The view is the moment the Feds have to raise taxes to prop it up then SS stops being a "retirement investment program" (LOLOLOLOL !!!!) and then turns into a entitlement that is a drain on tax payers.
 

senseamp

Lifer
Feb 5, 2006
34,852
4,799
126
Nobody is going to let Social Security to exhaust funds. It will be fully funded, one way or another.
 

MovingTarget

Diamond Member
Jun 22, 2003
8,990
84
91
Means test.
Remove the cap on SS taxable income. Include capital gains in this calculation for individual earners. That will go a loooooong way to fix and/or alleviate the problem. Of course, simple demographics will eventually lead to a situation where we will need to come up with a shortfall out of the general fund. By that time it'll be time to pay the piper, and I'm okay with that. I'm a bit weary of means-testing schemes as SS was originally structured as a type of insurance/annuity...a benefit that you pay for and earn. I would only advocate that in the most dire of fiscal situations.
 

Albatross

Platinum Member
Jul 17, 2001
2,344
5
81
People demand grandiose schemes for all,politicians deliver since it`s a democracy and they won`t be around to see the consequences anyway and the rest argue about the best way to prolong the inevitable end:same story in all democratic states.
 

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