Politics

Can Social Security actually go broke? No‼️

The political left is adept at creating non issues and then using convoluted arguments to solve an unrelated problem.

When someone (including me) says Social Security is going broke they mean the trust fund is being depleted to zero in about sixteen years.

However, Social Security will go on paying some level of the earned and promised benefits, about 75% +- . That is supposed to be good news?

Up until 2010 incoming payroll taxes over those needed to pay benefits were placed in the trust which invested the money in Treasury bonds paying the trust interest (3% give or take a few points). The trust also gets revenue from the income taxes some beneficiaries pay on 50% of their SS benefits.

Today all incoming payroll taxes, all interest payments, all income taxes plus the redemption of some of those Treasury bonds are needed to pay 100% of the benefits earned.

Only a shortsighted or very naive person would declare that a sound fiscal footing. And yet, that scenario receives a positive spin from Sen Sanders and friends and even the claim Social Security has a surplus which can be used to increase benefits.

We have no business talking about increasing benefits until we first make Social Security sustainable as it is. That means higher taxes on all workers and/or modifications to the program.

And for the record, nobody has ever talked about cutting the benefits currently being paid to beneficiaries.

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1 reply »

  1. Watched the video. She’s teaching what, socialist basket weaving?

    if the federal government starts printing money, so as to make good on Social Security promises they are not willing to properly fund with taxes, the concern won’t be about whether there will be enough goods and services for the dollars to buy. At first, there won’t be an issue. We will continue to be a net importer of goods from other countries. Then, sometime after the next election (where they bought your votes) they will get wise and notice that the dollar just doesn’t go so far. Then, watch them rapidly increase the costs of goods imported to America. Taken to its extreme, the United States could retire our $20 Trillion in national debt the same way. If they do, at some point, those dollars will approach worthlessness – check with the idiots in Venezuela – 1,000% per year!
    https://www.express.co.uk/news/world/1003251/Venezuela-economic-crisis-one-million-inflation-dollar-chavez

    By printing money, the feds will not only make good on the outsized Social Security promises Congress made to buy your votes, they will devalue the Social Security benefit itself, and, at the same time, devalue your accumulated savings and the value of all American’s financial assets.

    Are you surprised she is Bernie’s economic advisor? She knows about as much as he does about economics. I know I’d never send any member of my family to Stony Brook to study economics.

    Like

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