Social Security

Social Security isn’t broke, but it’s broken

A recent article in USA Today dispels several myths about Social Security; those myths have all been discussed many times here – check the Social Security category on the right margin.

Is it going to run out of money? No, it’s not going broke. Is it going to pay full benefits forever? No, in about seventeen years revenue will only allow for payment of about 75% of earned benefits; the system is broken.
imageIs it because Congress stole the money from the Trust Fund? No‼️

This notion is my favorite myths. Over the years the Trust invested in special Treasury bonds which pay interest to the Trust and that interest is now used to pay benefits. The government used the money from the sale of the bonds to run the government.

Now for my favorite question for those who say the government should not have sold bonds and used the money, but rather should have left the money in the Trust.

Where should the money have been invested to generate interest while remaining as near to 100% secure as possible?

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1 reply »

  1. Real estate (mostly undeveloped land), minerals, oil, would have been the top three on my list back in the middle of the 1980’s when we first started to run a surplus after passage of the 1983 Social Security Amendments Act.

    Real Estate: So, a good buy in real estate in 1983 would have been the undeveloped land along the I270 and the I 95 corridors between Washington DC and Baltimore. When I was in the Army back in 1971 – 1973, development didn’t go much beyond Gaithersburg, MD – just outside the beltway. I’m sure there are people out there back in the early 1980’s who knew of better parcels than those. Another good buy back in the early 1980’s would have been to upgrade and expand the interstate highway system as necessary and institute a toll road system. Finally, another good buy would have been, through eminent domain, reassert right of way for commercial (not passenger) rail, upgrade the rails and rail beds, and, much like the interstates, create a toll system.

    Minerals: Acquire mines with deposits of rare earth metals. Here, looking to create a specific trade partnership with Canada, China, Bolivia and a few other countries with deposits of rare earth minerals – the 15 lanthanides plus scandium and yttrium, the six platinum group elements, and other byproduct metals that occur in copper, gold, uranium, phosphates, iron or zinc ores. Life in the 21st century wouldn’t be the same without rare earth metals – you find them in cell phones, iPads, laptops, televisions, hybrid cars, wind turbines, Finally, build a pipeline for water from the Great Lakes to the West and Southwest, along the rail, right of way.

    With regard to oil, a trade partnership with Canada, Venezuela (heavy oil that can only be effectively refined in the US, in terms of the America’s) where maybe we could have avoided Chavez), and a partnership with one or more of the Middle East countries (Saudi Arabia, etc.) where it would also enable a strategic military relationship.

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