Social Security to start cashing Uncle Sam's IOUs

[classicman]

The retirement nest egg of an entire generation is stashed away in this small town along the Ohio River: $2.5 trillion in IOUs from the federal government, payable to the Social Security Administration.

It's time to start cashing them in.

For more than two decades, Social Security collected more money in payroll taxes than it paid out in benefits — billions more each year.

Not anymore. This year, for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes — nearly $29 billion more.

Sounds like a good time to start tapping the nest egg. Too bad the federal government already spent that money

Now the government will have to borrow even more money, much of it abroad, to start paying back the IOUs, and the timing couldn't be worse. The government is projected to post a record $1.5 trillion budget deficit this year, followed by trillion dollar deficits for years to come.

"This is not just a wake-up call, this is it. We're here," said Mary Johnson, a policy analyst with The Senior Citizens League, an advocacy group. "We are not going to be able to put it off any more."

For more than two decades, regardless of which political party was in power, Congress has been accused of raiding the Social Security trust funds to pay for other programs, masking the size of the budget deficit.

In the short term, the nonpartisan Congressional Budget Office projects that Social Security will continue to pay out more in benefits than it collects in taxes for the next three years. It is projected to post small surpluses of $6 billion each in 2014 and 2015, before returning to indefinite deficits in 2016.

Good luck to the politician who reneges on that debt, said Barbara Kennelly, a former Democratic congresswoman from Connecticut who is now president of the National Committee to Preserve Social Security and Medicare.

"Those bonds are protected by the full faith and credit of the United States of America," Kennelly said.
"They're as solid as what we owe China and Japan."

HAHAHAHAHA Wow I feel soooooooooo much better now!

[SamIam]

Note to self: die before 2037.

[ZenGum]

I first heard about this from PJ O'Rourke (sp?) with whom I generally disagree. IIRC, the soc sec money, by law, had to be deposited in some kind of bond. That bond could only be loaned to the treasury. The only legal thing the treasury could do was spend it. Which they did.
This one has been building for decades.
See what is happening in Greece RFN? Largely, they cannot afford the level of social security they have promised themselves. Their govt is bankrupt, yet the people still refuse to accept the austerity cuts. Riots ensue.
I don't know how this is going to play out, but it isn't going to be pretty. Stock up on long-life food, folks. Good luck.

[Crimson Ghost]

Originally Posted by SamIam

Note to self: die before 2037.

Don't worry.
If the Mayans were right, the world will end in December, 2012.
God, I hope so.
That means only 2 more Christmases I have to buy presents.

[ZenGum]

After that we'll be buying Tecapuchahulpamas presents.

[Trilby]

Originally Posted by Crimson Ghost

Don't worry.
If the Mayans were right, the world will end in December, 2012.
God, I hope so.
That means only 2 more Christmases I have to buy presents.

I like the cut of your gib. Think positive!

[ZenGum]

Is there much difference between this model of social security and a pyramid (ponzi) scheme? As long as the base keeps growing, no problem - growth slows, problem.

[Trilby]

Originally Posted by ZenGum

Is there much difference between this model of social security and a pyramid (ponzi) scheme?

NO.

[squirell nutkin]

Originally Posted by Brianna

I like the cut of your gib. Think positive!

[jinx]

I like the cut of your outboard.

[squirell nutkin]

It's raised especially for you.

[Shawnee123]

I like the sound of your boom!


(See how the mainsail sets? Call for the captain ashore, let me go home.)

[squirell nutkin]

It's a Bada Boom.

[Spexxvet]

Originally Posted by squirell nutkin

It's a Bada Boom.

Biiiiiig bada boom

[Shawnee123]

Tony Soprano