Text 13514, 63 rader
Skriven 2011-01-08 01:15:19 av Roy Witt (1:387/22)
  Kommentar till text 13502 av Bob Ackley (1:300/3)
Ärende: Welcome to the 21st century in a supposedly civilized country
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07 Jan 11 17:26, Bob Ackley wrote to Ward Dossche:

 BA> FWIW the biggest single item in the US government budget is interest
 BA> on the national debt. The budgets of the Defense Department and HHS
 BA> (Social Security/welfare) are both considerably smaller.

 BA> Note that the debt has gone from about two trillion dollars to nearly
 BA> five trillion in the past ten years;

You've got this backwards. The national debt is near it's congressionally
controlled limit of $14.3 trillion and the deficit is around $3 to $5
trillion. Nobody really knows for sure. At any rate, the interest on the
debt alone will never be paid off in full.

 BA> Also FWIW the US government has announced that in 2011 is cutting
 BA> workers' "contributions" to Socialist Security from 6.2 percent of
 BA> gross income to 4.2 percent (plus a like amount from the employers
 BA> which doesn't appear on people's pay stubs).

This is a one year deal, to make you feel better. You didn't mention that
the worker's deduction continues to a higher dollar earned amount at that
percentage than it did 3 years ago. Where it used to be around $75k in the
year 2000 at 5%, it has risen to over $100k in the year 2009 at 4.7%. The
government speaks about the lower interest rate, but doesn't say anything
about how much longer per year you have to pay in.

 BA> Great, the system is going broke and they *reduce* its income.

Not really. They lowered the rate, but at the same time they raised the
high limit. But even at the present rate, you pay in less per person than
you did in 2000, by about $300. With the post-war boomers entering
retirement this year, there will soon be half as many workers paying into
the system.

 BA> 2009 was the first year that Socialist Security benefits paid out
 BA> exceeded "contributions" coming in -

2009 was the last year that SS benefits paid out equalled what was paid
in. 2010 was the first year payouts were more than received.

 BA> all that surplus that's been accumulating since 1935 is invested
 BA> - by law - in the US national debt, and no place else;

The contributions are invested in US Securities and no place else.
However, the surplus has always been turned over to the Treasury, which
used the cash to meet various obligations, and gave the trust fund
securities in return in the form of IOUs.

 BA> there  is no "Social Security Trust Fund" of money saved up by the
 BA> workers and never has been.  That difference between benefits and
 BA> "contributions" will only get bigger.

Yeup. But the government will print more securities and fill the SS
coffers with more IOUs. Someday they'll have to finally borrow money to
pay back into SS, or not.


                R\%/itt

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