Shut up idiot.

http://www.federalbudget.com/

Money comes in, and money goes out immediately, but no serious amount goes to interest-generating investments which should currently be at 100 trillion USD to be able to finance future liabilities. But this is an enormous amount, in other words, expectations VASTLY exceed the means:

http://www.forbes.com/2009/05/14/taxes-social-security-opinions-columnists-medicare.html

“To put it another way, the total unfunded indebtedness of Social Security and Medicare comes to $106.4 trillion. That is how much larger the nation’s capital stock would have to be today, all of it owned by the Social Security and Medicare trust funds, to generate enough income to pay all the benefits that have been promised over and above future payroll taxes. But the nation’s total private net worth is only $51.5 trillion, according to the Federal Reserve. In effect, we have promised the elderly benefits equal to more than twice the nation’s total wealth on top of the payroll tax.”

Priorities yankees, where are your priorities?

Vastly more money is beingt spent on uneccesary and failing wars, than would be needed to fix social security. We in civilised countries who have social security, (a basic right we believe) like Australia, Britain, Denmark etc (ie: all your alleged allies) look on in astonishment and horror at the inhuman and nasty attitude of American conservatives in this regard. YUK!

Whilst you reduce various struggling natioons to abject poverty and life’s ruin for your major corporate interests (Oil and Weapons), more and more of your own people are experiencing poverty, starvation, homelessness and the USA resembles nothing short of a corporate dictatorship existing as a lackey for israel (Rothschildlandia). You’re a joke USA, an ugly, bad taste joke on the world but no less a giant hoax and joke on yourselves.

In the so called ‘real’ world, any Trustee or lawyer who ‘borrowed’ or stole from a Trust fund would be imprisoned on felony fraud and/or theft charges and lose their professional license and civil rights, such as voting in elections and to be bonded or carry/own a firearm. A Trust is a Trust-why were not the politicians and bureaucrats in the District Of Criminals similarly persecuted for theft from the Social Security Trust Fund by conjuring up worthless “IOU’s” and spending the hard assets elsewheres? Do the same ‘laws’ apply equally to our lawmakers & bureaucrats that apply to ‘we the people’, the lowly common citizen in civilian life? If Social Security was honestly administered with no theft (ie: “worthless IOU’s”)from this Trust Fund, would it be solvent in the present time? Is political corruption and lawbreaking: “stealing” from the Trust a cause of the problem? Tom Paine, one of the founding fathers of the USA was very much for a system resembling our Social Security today to take care of the many so called “man/woman on the street” or “average” individuals in their old age who did not have the education, financial expertise, social connections, or status of many of those who write for and read the literature of the Mises Institute. I have seen 19th century printed steel plate engravings from the Edwardian and Victorian periods of the sick and elderly starving and dying in the gutters in metro London-with the undertaker’s waggon in the background taking the bodies off the street and alleyways to be buried in the mass grave we politely call ‘potters field’. If Social Security and allied programmes are abolished, what would those who ideologically object to these programmes put in place as an alternative to prevent the conditions described in the 19th cnetury steel plate engravings previously described? Or do they care? I have no ideological or ‘philosophical’ commitments, just questions, here.

And US is such a large economy that it can produce something which will be valued abroad.

Of course foreigners would not buy any bonds issued some banana-republic in its own currency. These bonds could not be traded internationally because so many would not trust their value stayi ng constant for a long period.

as I stated it is not that these bonds are worthless. It is just that they are claim to monetary flow arising from production which can used to buy consumption goods. This claim might be valid, but it is still true that government has not used monies for productive purposes.

Real wealth in economy are actually various capital goods and stocks of consumption goods produced earlier. Also many non-financial assets like natural resources are real wealth. Ownership of financial assets just determines who will get a certain percentage of surpluss arising from production.

Same is true with respect to private households. If they want to consume more than they produce, they will increase their level of indebtness.

Good pension plan would increase level of economys capital stock so that in the future more could be produced or purchased from abroad to satisfy the needs of labourers and growing number of pensioners.

“going negative” is *not* the same as bankruptcy. As an example, In 2008, my net worth “went negative” but I was not bankrupt (e.g. I still had assets.) Additionally his phrasing that “congress has already spent” the current social security savings is true, but in a wrong headed sense. Anytime a bond is issued the issuer has typically ‘spent’ the money–this is the purpose of a bond. Still, the recipient of the bond will be paid that money back. According to Mr. Daily’s reasoning, any bank or foreign government holding US T-bills should view that money as not existing, since Congress has already ‘spent’ that money. This is not how the world views US T-bills–rather the world views them as a very reliable asset. So should we.

For the record I do see serious problems for our social security program, but Mr. Daily’s analysis in both tone and content, feels sloppy to me.

–dan

They can’t completely destroy the economy unless they force us all to have lobotomies, too.

I too was interested in how someone comes to say such ridiculous things. Behold the mountains of drivel:

http://www.angrybearblog.com/search?q=Bruce+webb

from this guy:

“I am by training a historian and mythologist who then has spent my working career in information retrieval and land use regulation. My interest in Social Security arose when I noticed in passing that the dates related to ‘crisis’ were moving but that nobody seemed to be noticing that and still less asking the key questions ‘why?’ and ‘can this go on?’ So I set out to try to answer those questions and then share the results which somehow led to a gig here at AB. Politically I am somewhat left of left of center and could best be described as a ‘New Dealer’ and so weigh in on more overtly political questions as the opportunity arises.”

Although I do like this posting of his:

http://www.angrybearblog.com/2009/11/crowding-out-social-security-and.html

In my most grim moments I actually hope these lefties are successful in their attempted takeover. Their complete destruction of the economy will at least put Russ’s cackling heroes out of business [see Russ and his imagined protectors above].

My misguided campaign ends the minute yours does.

$1.50 a week would not cover my Social Security costs for sure. How can that be enough?

You give the government money. They spend it and give you a promise in the form of a piece of paper or maybe just an electronic entry. Some people call this a “phony IOU” or “fiat money”. Other people have built up an entire world economic system around Full Faith and Credit of the United States of America and call it “buying the safest investment in the world”. Suggestions that the Special Treasuries in the Trust Fund are legally different from those held by the CCB is somewhere between dishonesty and economic treason.

Infinite Future was introduced with the 2003 Social Security Report PRECISELY to enable the thoroughly dishonest and snarky argumentation being deployed here. Not only is “unfunded liability” non-existent in legal terms, it being a purely theoretical construct that measures a gap between future revenue and future cost that will be bridged from one side or the other, measuring it even over the standard 75 year window is from a probability basis ridiculous, using numbers that extend that to a hundred years (so-called ‘current participants’) or Infinite Future (so called ‘open group’) are literally only useful for Peter G Peterson inspired propaganda.

The editors who approved this piece did their readers a grave disservice, if libertarian inspired folk want an open, data based debate feel free to comment on the Angry Bear Social Security Series. Because an honest assessment of this piece would put me on the wrong side of publishing and civility standards.

Financial assets are not wealth per se. They give you right to have a certain or very uncertain (in case of stocks) monetary flow each time period. This monetary flow can be used to fund consumption. By wealth I mean physical stock of capital which can be used to produce consumption goods. Ownership of these financial assets just determines how in each time period the “cake” is distributed. And this cake is baked by means of labour, entrepreneurship and capital goods produced earlier.

Economys stock of capital can be enlarged only by means of saving (so that more capital goods are produced instead of consumption goods) and purchase of governments bonds is not saving since government instantly squanders these monies.

Legally it might be very well true that those who paid various payroll based taxes are entitled to some benefits, but government can change laws. Economically speaking purchase of governments bonds is not saving.