Harry Reid: Leave Social Security Alone - It's Solvent For at Least 30 Years

[kpete]

Source: Crooks And Liars

Harry Reid: Leave Social Security Alone - It's Solvent For at Least 30 Years

.................................

When asked by Lawrence O’Donnell what he meant when he said Social Security could be improved, Reid responded:

REID: I have said clearly and as many times as I can, leave Social Security alone. Social Security does not add a single penny, not a dime, a nickel, a dollar to the budget problems we have. Never has and for the next 30 years it won’t do that.

So what I’ve said, if you want to look at something to take care of the out years, let’s do it at the right time. It is not in a crisis at this stage. Leave Social Security alone. We have a lot of other places we can look that are in crisis. Social Security is not. I repeat, for the next approximately 30 years people will draw 100% of their benefits.

And if we do nothing after that, they’ll draw 80% of their benefits. Now I want to make sure that in the out years, 30 years from now, we draw 100% of benefits. That’s important. I believe in Social Security. I think it’s the most successful social program in the history of the world. But I am not going to balance the budget on the backs of senior citizens who have paid into the fund and deserve their money.

Read more: http://videocafe.crooksandliars.com/heather/harry-reid-leave-social-security-alone-its

[Kingofalldems]

1. K and R for good news!

[FlyByNight]

2. Thank you, Sen. Reid

:thumbsup:

[bossy22]

3. depends on what definition of solvency you use

balance sheet solvent- maybe
cash flow solvent- not really

social security is solvent on paper because of its 2.5 trillion dollar "reserve"- the only problem is that reserve is mostly kept in the form of debt. We will need to cash in that debt in order to pay for the shortfalls in the SS payout- which means we are going to have to either borrow money from somewhere or we will have to have the Fed purchase the debt and print the money.

for example- lets say the only asset i have to my name is a 2 million dollar house. I have no money in my checking acct, no savings, just a house with no mortgage. On my balance sheet it shows that i am worth 2 million- nice right. the problem is that lets say i need to buy a car- i can't- because i have no cash- no way of actually paying for it. What i would have to do is take a "loan out of my house" aka a home equity loan. I would essentially be borrowing from myself. But the problem is- i would eventually have to pay that money back to the house so i would need to borrow money from somewhere else to pay it back.

[dkf]

13. Yeah they can cut funds to the states to keep social security benefits where they are.

That will mean less funds for things like education. If teachers think they are fighting budget cuts now just wait til social security eats up all the federal funding.

[Uncle Joe]

15. Money itself is nothing but an IOU backed by the federal government.

There is no difference between Treasury Bills, Notes, Bonds and cash in that regard.

The monetary issue of printing more debt; cash to buy back the debt; Treasury Securities owed to Social Security is moot, it makes no real difference to the nation's total debt.

Furthermore from a moral standpoint, this national debt problem has nothing to do with the Social Security Administration's actions and everything to do with the federal government's decades long catering to the wealthy by cutting taxes, while waging war irresponsible fiscal policy.

This is Reagan's "Trickle down" aka "Voodoo" economics come home to roost, a deliberate attempt at bankrupting the federal government to set the premise for attacks against long standing, much needed, quality social programs.

I believe the author of the letter on this thread laid his finger on the real problem.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=439x652744

[bossy22]

18. i dont disagree

thats why something has to be done. Im not talking about cutting benefits- im talkin about raising the social security tax cap.

[Uncle Joe]

23. On one level I agree with that, but the real puppet string pullers are still making out

for their abuse of the system

I believe the best policy would be raising taxes on the mega wealthy to offset buying back social security debt.

Raising the social security tax cap will ultimately damage the middle class more, particularly over time as Inflation takes hold, while the mega wealthy still sit on their long held tax cuts.

[plumbob]

31. Some of that debt is "paid" and sold every Monday, a dynamic market.

In fact, with all the panic in the world, interest rates paid on Treasurys is falling through the floor, because they are so desirable compared to gold, silver, stocks, commodities, or the debts of other countries.

Your analysis is flawed:
We don't have a debt free asset and nothing liquid.
We have a debt that is made up of pieces that mature every week, when they can be renewed or bought by others. Banks and other businesses routinely cash in and out on Treasury because the market is so liquid.

Social Security is absolutely in great shape even if we do nothing for 30 years or so.

We could solve it forever by simply lifting the cap on income that we use to collect SS tax.

The real deal is that Wall Street sees a big piece of money that they have not been able to steal yet, so they float these fucking bullshit scare stories about SS.

Those bastards that do it deliberately should suffer the greatest and most painful death possible. I've got suggestions and names, too.

Those that do it from ignorance just need educated.

[Igel]

40. Not at all.

The SSA "trust fund" is composed of special issue notes that can only be held by the Social Security Administration and can only be sold back to the Treasury Dept. They're not traded publicly. They're considered part of the national debt, but are held entirely by the US government (Treasury, in fact) and are payable only to the SSA (in other words, to the US Government).

Hence the definition of "solvency": In order to buy back the notes when the SSA presents them for redemption, the Treasury and Congress have precisely two options: They can collateralize the in-house debt and make it debt held by the public; or, they can pay the SSA The cash from operating revenues (which is where the money went in the first place.

In the first case, they issue billions of dollars of new T-bills, in addition to the deficit currently predicted. We can expect to see T-bill interest stay low only for as long as there's nothing better in the market; after that, you can expect to see interest rates increase, and the more debt owed the higher. (Currently we pay about $200 billion in interest, combined; it's getting really close to the amount budgeted for Medicare; given another year of trillion-dollar deficits, or a spike in interest rates, interest on the debt will exceed what's paid for health care.)

In the second case, Congress and Treasury can simply dedicate billions of dollars of tax revenues to redeeming the notes, money that currently goes to the DOD, Medicare/Medicaid, education, or a million other line items.

The other option is never buying them back in order to cover the SS payouts; this can be done by restricting future benefits or raising taxes. Then the difference between simply forgiving the debt and leaving it on the books but never redeeming it is pointless. (Note that since the Congress determines benefits, taxes, and the SSA's budget, as well as Treasury's budget, it can readily and legally forgive the debt that one branch under its legal authority owes to another branch under its legal authority.)

[plumbob]

44. Funny how $200 billion for health care is a lot, but a trillion for wars

is nothing, isn't it?

Until we make killing people unprofitable, we'll hear this line.

These notes can be paid from dollars generated from regular Treasury bills in a one to one swap. They're fungible; they're just a one-off. Right now, the interest on the national debt is owed based on spending on non-SS items, especially war, and be sure to include the long term disability and medical expense attributable to the wars and them only.

When you want to cut back on money spent on killing and borrowing money to spend on killing, come on back, and we'll talk. There's not the slightest difficulty in redeeming these bonds for cash.

Once again, wall street just wants to steal a large stack of money that so far they have not been able to get.

Fuck them.

[bossy22]

48. yes there is

"These notes can be paid from dollars generated from regular Treasury bills in a one to one swap." You dont think that selling 2.5 trillion dollars with of debt at once may cause an issue or two?

This has nothing to do with wall street and everything to do with the laws of accounting.

[plumbob]

53. No need to sell 2.5 trillion at once. We need about 1.6 billion per week

over the next 30 years.

Make that 83 billion per year. Consider that the Treasury actually turns over 3.4 TRILLION per year, that would increase our borrowing about 2% per year. Big deal.

Please don't say law and accounting in the same sentence. Arthur Andersen, anyone?

[rhett o rick]

57. Your example is exactly where we let the RepubliCons go wrong. Instead of letting you borrow money

on your house (Social Security), we require you to get the money for your car (the Iraq war) from new taxes. Dont borrow against Social Security to pay for wars. Make the American people pay for their damn wars via direct taxes. Maybe they wouldnt be so quick to kill innocent women and children.

[melm00se]

4. this all boils down to the definition of "solvency"

If you define solvency as taking in more than you are paying out, then social security is insolvent.

if you define solvency as being able to pay out at established rates, then social security is solvent.

I am not sure that Sen Reid is being completely honest as the CBO has stated in October 2010 the following:

CBO projects that the DI trust fund will be exhausted in fiscal year 2018 and that the OASI trust fund will be exhausted in 2042. Once a trust fund's balance has fallen to zero and current revenues are insufficient to cover the benefits that are specified in law, a program will be unable to pay full benefits without changes in law.

So while he is accurate that SS is OK for 30 years, he fails to address year 31. This is a lie of omission.

The longer folks jerk around with addressing the underlying issues (that the American population is aging and a huge number of Americans will enter the Social Security system over the coming years) the harder and harder the solution will be.

I know that this is a shocking concept but a little long view planning might be in order. a solution now might only entail a small change but waiting another 5-10-15 years will require stronger action to resolve the issue.

[bossy22]

7. we may not be able to pay out at an established rate

thats the issue- thats why the program cash flow solvency can be called into question

http://en.wikipedia.org/wiki/Social_Security_Trust_Fund

currently the SS trust fund is held mostly in non-liquid asset forms. This means that the trust fund will need to be convereted to liquid from by 3 methods- raising taxes to increase revenue, issue more debt to cover the pay outs, and/or transfer the trust fund the fed reserves balance sheet and have the fed print the money out.

but i do agree with you that a small change now is better than a big change later

[dkf]

16. He won't be in office when the shit hits the fan.

He doesn't give a damn about the mess he leaves.

[plumbob]

32. You do realize that in 2042, the first baby boomers, those born in

1946, will be 96, or in reality, dead, right? Life expectancy in the US is a little under 78 years.
1947 babies - 95 or dead, probably dead for 17 years
1948 babies - 94 or dead, probably dead for 16 years
1949 babies - 93 or dead, probably dead for 15 years
1950 babies - 92 or dead, probably dead for 14 years
1951 babies - 91 or dead, probably dead for 13 years
1952 babies - 90 or dead, probably dead for 12 years
1953 babies - 89 or dead, probably dead for 11 years
1954 babies - 88 or dead, probably dead for 10 years
1955 babies - 87 or dead, probably dead for 9 years
1956 babies - 86 or dead, probably dead for 8 years
1957 babies - 85 or dead, probably dead for 7 years
1958 babies - 84 or dead, probably dead for 6 years
1959 babies - 83 or dead, probably dead for 5 years
1960 babies - 82 or dead, probably dead for 4 years
1961 babies - 81 or dead, probably dead for 3 years
1962 babies - 80 or dead, probably dead for 2 years
1963 babies - 79 or dead, probably dead for 1 year
1964 babies - 78 or dead, freshly dead

And then you have run out of boomers, because the last ones were born in 1964.

So those goddamm boomers, who doubled the SS taxes on themselves to insure their retirements, and which demographics show will work, will finally be out of the way of the gripers and complainers who think we are just useless eaters occupying THEIR precious space on the planet.

So action is occurring, and I don't know why people think boomers will live forever, but there it is. Uncap the income and SS will be good for as far as you can crunch numbers.

[dkf]

58. The real problem is medicare.

There is no cap on that either so you can't fix it that way.

[No Elephants]

61. Medicare for all, so costs can be spread. We are now allowing insurers

to collect a fortune in premiums from the youngest and healthiest among us, while Medicare is stuck paying bills for the disabled and elderly.

Also, look at medical costs.

For just one example of MANY, someone needs to tell me why the bill for two nights in the hospital was over $15,000, when all I needed was IV nutrition and fluids--no fancy tests, no meals, no special attention beyond changing IV bags when empty (I was ambulatory and pretty much took care of myself, except for changing IV bags--which I also could have done if they le me. I had done it a home previously. )

Almost $8000 per night for minimal inpatient care! Seriously?

Meanwhile, this hospital keeps buying up VERY pricey real estate like it's a penny a square foot. And has acquired every hospital and every formerly reasonably priced neighborhood health enter in quite a radius, plus a few rehab/nursing home facilities.

Why feds allow health care monopolies is also beyond me.

But, I'm guessing you were thinking along very different lines for solutions.

[No Elephants]

64. Reid did address year 31. You may disagree with his conclusion, but

attributing "a lie of omission" to Reid is itself false.

I do agree with this part of your post: " a solution now might only entail a small change but waiting another 5-10-15 years will require stronger action to resolve the issue."


(typo edits)

[sarcasmo]

5. One person that gets it and is not buying the right wing talking points.

[bossy22]

9. but he doesnt get it- and thats the point

http://en.wikipedia.org/wiki/Social_Security_Trust_Fund

that article explains how there are only 3 real ways to get the money out of the trust fund. raise taxes, print money, or issue debt. The trust fund isnt a bank account, its not a liquid asset- its DEBT.

[on point]

11. No, it is an asset. It is loaned out to the US and it needs to be paid, just like all other T-bills.

[bossy22]

14. and how do you pay for T-bills when you are running deficits?

you issue more T-bills!

[dkf]

20. Or you can reduce education funding and housing funding and infrastructure funding

And food inspection funding, and all those other goodies that states expect from the Federal Government. Arts funding is going to be a goner for sure.

[bossy22]

22. true or you could do something that makes the most sense

RAISE TAXES ON THE WEALTHIEST AMERICANS.

[No Elephants]

62. Gee, you forgot about reducing the "defense" (cough) "budget" (cough).

And let's throw in there everything that is supposedly making us safer, from Pentagon, to CIA, to FBI, to Homeland Security, to Secret Service to whatever else The overlap, duplication and fiefdom rivalries are not only costing us many fortunes, they are making us much LESS safe.

Except for HHS, I don't know about the past, but the alleged distinctions that supposedly made it sensible to create one new agency after another are silly in today's world, if indeed they were ever sensible.

[Igel]

41. Not T-bills.

And once you realize that the Social Security Administration doesn't hold any kind of government obligation that can legally be bought or sold by anybody other than the US government to itself, you realize that the terms of the discussion have to shift rather dramatically.

So not only does it need to be paid "just like all other T-bills," since the only entity affected should the US government default is the US government the other completely equivalent way of achieveing the exact same end is for the US government to simply forgive the debt it owes to itself.

Default, forgiveness, two sides of the same coin. A coin that only has two sides because the debt isn't T-bills.

[Demit]

12. The govt took that money & freely used it for 30 yrs so that it WOULDN'T HAVE TO raise other taxes

It would be like promising your kid a college fund, then when he came to collect it to go to college, telling him well, it's not there. We used it. You liked that trip to Disneyworld, didn't you? You liked that pool we put in, didn't you?

That SS money came from a SURPLUS, from payroll taxes being raised starting in 1983. They collected more from us these past 30 years so that it would be there for when baby boomers retired. It's time to put it back.

[bossy22]

17. you actually are right

"It would be like promising your kid a college fund, then when he came to collect it to go to college, telling him well, it's not there. We used it. You liked that trip to Disneyworld, didn't you? You liked that pool we put in, didn't you?"

EXACTLY- the money was spent- its gone...and in its place is government debt. So you are goin to need to find some way to convert that debt into checks and there are only 3 ways that we can do that- increase taxes, print money, or issue more debt

[No Elephants]

65. Ah, yes, but you own up to having spent your kid's hard-earned college fund

on wars that killed and maimed his friends, as well as creating new ongoing obligations, like increased foreign aid and increased veterans' benefits. All to make war and your other expenditures more palatable to voters (and help get yourself re-elected)by not raising taxes to pay for those other things.

You don't keep hissing the word "entitlements" when speaking of Social Security and pretending seniors and the disabled are bankrupting AmeriSocial Security a and banking it more vulnerable to terra, terra, terra.

And, if you do have to raise taxes to replenish the many $ you stole from your kid's hard-earned fund, you don't say you have to raise taxes bSocial Security of Social Security.

You give the real reasons namely, Congress and the WH have for many years stolen from the Social Security fund and either wasted the money or spent it on things like enriching Halliburton and Blackwater and their owners and/or stockholders and occupying other nations, making them hate us more than ever.

Now, is just being honest so hard? (Guess so.)

[A Simple Game]

24. Yes he does get it.

You have been programmed to believe that SS is the same as the Federal Government, it is not.

The Republicans want everyone to believe they are the same because it would look like the debt would be owed to itself. That is not the case.

This is like you lending money to your brother in law, he owes you the money, he just doesn't want to repay it. The Fed doesn't want to repay this debt.

[bossy22]

29. i have not been programmed to believe anything

SS is not the same as the general fund of the u.s.- its financed through its own taxes- but the surpluses did go back to the general fund so the debt that is the trust fund is still held by the U.S. treasury.

and to use your brother in law example- what happens if your BIL doesnt have any money in which to pay you back? What happens if he spent all that money on a down payment on a new car? lets say you need that money in liquid form- to pay for groceries. If your BIL does not have any money (no cash on hand or in a bank account), the only thing then he can offer is part ownership (stock) in his new car, but you can't pay for your grocery bill in "car stock". That is the case with the SS trust fund and the fed govt. The trust fund is one big IOU. The problem is now that IOU needs to be repaid and we are running huge account deficits so we have to ask ourselves "where is that money coming from?". We can do 3 things- increase taxes, sell more debt, and/or transfer the trust fund to the Fed reserve and have them print out the money through a quantitative easing type program.

social security payouts cannot be done through debt- they need to be converted to liquid assets before the check can be sent out.

[on point]

34. The point is that it needs to be paid, just like all other T-bills.

I guess we really couldn't afford those Bush tax cuts and the other voodoo economics of the Supply side fraudsters like Raygun.

In my book, SSI gets paid BEFORE any T-Bill holders. That is it is 'senior debt' (no pun intended). Before cutting social security consider cutting payments to T-Bill holders among the wealthy and in China. You know that isn't going to fly!!

So yeah, the debt needs to be paid. And the way to do that is restore the taxes on the wealthy. Cut defense spending. Create a single payer health plan to reduce medical costs by 2/3 for society (so we match the rest of the developed world costs).

I am not in favor of 'just print more money', because that pays in nominal terms, but not real terms and is another way of cheating the Social Security Trust Fund.

[A Simple Game]

45. I vote to cut defense spending for a start.

But of course defense spending is the main reason they don't want to pay back the money owed to SS.

[bossy22]

49. cutting defense is only a temporary solution

it wouldnt solve the cash flow issue.

[No Elephants]

63. A permanent spending reduction has a permanent helpful effect in my budget.

[lumberjack_jeff]

36. Crisis? Try this simple logical exercise.

What happens if government does nothing?

People retire, and government will redeem that debt which is "backed by the full faith and credit of the US". There's a constitutional amendment which guarantees it. Everyone gets every penny promised to them for the next 30 years. I don't see any crisis.

"Section 4. The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void."

To the extent that a $13 trillion debt is a problem, it's not mine as a Social Security beneficiary any more than it is a problem to the Chinese central government. We both deserve to have our loans repaid.

[bossy22]

43. the issue is how we will repay it

and thats what im talking about. Harry Reid saying that they won't even discuss SS reform is beyond silly and in fact is going to harm us in the long run. We need to atleast have the discussion on how we expect to pay back the SS trust fund. Cutting other parts of the budget can only go so far- we need reform. Whether its getting rid of the SS tax cap (which would solve alot of this), a suretax on the wealthy for SS taxes, or even raising the age- these are discussions we need to have. At the moment SS is only balance sheet solvent- not cash flow solvent. We havent figured out which means we will use to convert those T-notes into SS checks.

I'm surprised so many DUers are willing to stick their heads in the sand and pretend this isnt an issue.

[lumberjack_jeff]

50. I. Don't. Care.

If the government is in such bad shape that they can't repay their very real and legally binding debt to me, then I'm the least of their problems.

Every day, the US sells more treasury bills to investors, foreign and domestic seeking a safe investment. I won't let 'em selectively default on me.

[Psephos]

54. Hilarious.

You poor sap, you actually think the US government has a "very real and binding debt" to you? You got a jpg of the promissory note you care to share?

There is no promissory note. No contract. No enforceable bond. No recourse in court for you if the terms of Social Security are changed.

Social Security is not a debt to ANYONE. It's a TAX. It's a law passed by Congress in 1935, and amended many times since. Congress can change its obligations to anything it wants, and you can't do boo-hickey about it.

They don't "save" "your" money when it's taken from your paycheck. Social Security taxes are used to pay those who are drawing benefits. It is, by actual definition, a Ponzi scheme. In any Ponzi scheme, the first participants get the money, while the suckers at the end get a sack of pebbles. While the demographics were favorable, the extra money paid into the SS "account" (which is actually just the same Treasury other taxes go to) was sucked up and spent by the rest of the government.

We have, in the past year, reached the tipping point, and SS is now running an actual deficit. There are no more surpluses. The number of workers paying in has dwindled while the number of beneficiaries has grown. The myth of the IOUs is exactly that: politicians figured you and millions others as a dope, and told you a fairy story, so they could spend the "trust fund" on goodies for their voters, and leave it to future people to pay back.

The future is now. The "trust fund" money is long gone and it ain't coming home.

lol

The US government is currently borrowing 40 cents of every dollar it spends, and it is spending $10 billion EVERY DAY. Now the SS liabilities are going to have to be covered out of general funds, on top of that. Riiiiiiiiiggggght. How long would YOU last before declaring bankruptcy with such insane finances? More to the point, who's going to lend an already bankrupt US all those additional trillions needed to stop SS hemorrhages in the years ahead?

No one.

Why do you think the Fed is currently buying hundreds of billions of Treasury bills, with printed (funny) money? Because if they don't, it's game over. Either way, it's just a matter of time.

[lumberjack_jeff]

56. Okay. "Surrender first" Got it. Thanks for the tactical lesson.

a) The securities in which the trust fund is invested bear the words "backed by the full faith and credit of the US."
b) It's not running a deficit. The value of the trust fund continues to grow each year because of accrued interest.
c) Congress can change the rules... if you let 'em.
d) Only someone who is completely and fundamentally ignorant of how insurance works would consider it a Ponzi scheme.

The US owes the Social Security Administration and its beneficiaries $2.6 trillion.

In the past, the trust funds have held marketable Treasury securities, which are available to the general public. Unlike marketable securities, special issues can be redeemed at any time at face value. Marketable securities are subject to the forces of the open market and may suffer a loss, or enjoy a gain, if sold before maturity. Investment in special issues gives the trust funds the same flexibility as holding cash.

snip

As stated above, money flowing into the trust funds is invested in U. S. Government securities. Because the government spends this borrowed cash, some people see the current increase in the trust fund assets as an accumulation of securities that the government will be unable to make good on in the future. Without legislation to restore long-range solvency of the trust funds, redemption of long-term securities prior to maturity would be necessary.
Far from being "worthless IOUs," the investments held by the trust funds are backed by the full faith and credit of the U. S. Government. The government has always repaid Social Security, with interest. The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the Federal government.

Where does the money come from?

I. Don't. Care.

[Igel]

42. The SSA is an "independent agency" in the executive branch of the US government.

It was established by Congress. It exists by virtue of Congressional legislation. It used to be under a cabinet secretary--Congress so decreed--but has become independent since then (similarly, by an act of Congress, one that Bill Clinton signed).

Nonetheless, for all its independence its commissioner is nominated by the president (the current one by *) and confirmed by the Senate. Its benefit payouts are approved (and amended, if need be) by the Congress, its taxing authority is entirely Congress'.

If Congress decides to do something with the SSA, it's done. It's why Sen. Reid has anything whatsoever to say about it. It's the SSA, a portion of the US government, subject to Congress' diktats.

Which is to say, it's part of the "Federal Government."

[plumbob]

33. It's the most liquid market out there - please educate yourself.

http://www.investinginbonds.com/learnmore.asp?catid=3&id=383

Bonds issued by the U.S. Treasury are backed by the full faith and credit of the U.S. government and therefore considered to have no credit risk. The market for U.S. Treasury securities is also the most liquid in the world, meaning there are always investors willing to buy. U.S. Treasury yields will almost always be lower than other bonds with comparable maturities because they have the fewest risks.


or

http://www.fool.com/bonds/bonds04.htm

"Liquidity" is the term used to describe how easy it is to sell something. Highly liquid bonds include U.S. Treasuries and debt issued by large, blue-chip corporations.

or

http://www.ehow.com/us-treasury-bonds/

U.S. Treasury bonds are the most liquid and marketable securities traded in the United States and they vary in price depending on interest rate expectations


Do some more Googling on your own, or call a broker.

[bossy22]

46. Bonds are not inherently liquid

you cannot buy a new computer with bonds, you cannot pay your grocery bill with bonds. They need to be converted.

What you say is 100% correct- they are the most liquid because there are alot of buyers out there. But this is not a painless solution to the SS trust fund. Selling SS trust fund notes is equivalent to issuing new debt- so we would in reality by borrowing to pay for social security. This is not necessarily the ideal solution- borrowing costs for the fed government as a whole will increase (by how much i do not know) and it will still crowd out other government budget lines

Personally i prefer updating the SS tax cap to tax higher income.

[plumbob]

52. No, you would be borrowing to pay for the things you bought with SS cash.

Get it straight. These were collected tax revenues, which were spent for other than the purpose intended. Now the money must be put back, and so the money borrowed is going to go toward what was already bought - mostly war and death.

Actually, we could just restore the 90% tax bracket from the 50s and tax capital gains as ordinary income and could very likely balance the budget.

But horror of horrors! That would mean taxing taxing those who gained the most during the last 30 years for the war and death machines.

[No Elephants]

66. +1 And not only from war machines, but also from polluting our air and water, using our airwaves,

mining and otherwise exploiting our minerals, lumber, and other resources--including in our national parks--disproportionately using our infrastructure and on and on.

Anyone who is not both rich AND devoid of conscience who claims taxing the rich disproportionately is class warfare or unfair is a liar or a self-defeating, brainwashed fool --and, most likely, both.

Hell, even the very rich and their kids and grandbabies are, and will be, stuck with polluted air and water and probably various damage from nuclear failures.

[dkf]

19. He probably realizes that he is leaving us totally screwed but he doesn't care.

The adults have commandeered the future of the young and the unborn. It's so unfair it really pisses me off.

[bossy22]

21. my grandfather used to say

that this country was so backwards that we spent $4 on seniors for ever $1 on children. I dont know if thats true or not but sometimes it feels like that. the people who drive most of the expensive luxury cars in my town are all retired elderly people- yet they seem to be the ones who won't hesitate to complain if a store doesnt have a seniors discount. Meanwhile a young family can barely afford their kids school supplies.....

[wickerwoman]

28. This kind of stuff doesn't get us anywhere.

Elderly people didn't take anything from children. It's the Republicans not being willing to fund anyone and being able to take stuff away from children (who don't vote) but not elderly people (who do).

And statistically, elderly people are one of the most vulnerable populations in society. 24% of elderly people in the US live under the poverty line, many of them on fixed incomes which means with inflation that they can only look forward to getting poorer and poorer. The elderly also have many expenses that children don't, such as drugs, medical equipment, needs to upgrade their homes for wheelchairs, need for living assistance, etc. Elderly people also often have higher heating needs and have to choose between going hungry, going without medication or risking freezing to death.

If some elderly people drive expensive luxury cars, maybe it's because they worked their asses off for fifty years and were able to afford them? Or maybe their successful children bought them for them. Either way, it's anecdotal and doesn't give an accurate picture of elder poverty in the US.

[bossy22]

30. not true

according to census data the age group that percentage wise is the least in poverty is seniors according to 2008 census data. http://pubdb3.census.gov/macro/032008/pov/new02_100_09.htm

Also, the poverty rate is based on aggregate income- not disposable income. Seniors have a greater percentage of their income that is disposable compared to all other age groups. So a 21 yr old kid making $12,000 a year living on his own is different than an 66 year old making the similar amount.

I'm not saying that elderly poverty isnt a problem- it is. I'm saying that its not the problem that the AARP makes it sound like it is- that the majority of seniors are living in filth and have to choose between gas or groceries. The truth is that seniors as a group in whole are in a better financial position than most of their middle age counterparts.

[plumbob]

35. Any surprise that after a lifetime of work, hardworking educated

prudent people will have accumulated more than a group of 23 year olds right out of college? So it seems that if you work long, you will prosper.

We could change it, you know, to where 6 year olds get all the wealth in their family on their 6th birthday, and then take money and assets away every 10 years until at age 66, you are kicked to the curb. Would that be preferable?

Besides, just think, if you are nice enough to send a birthday card once a year and call every 6 months, when those old rotten bastards die, YOU might get some of the proceeds in their will!

Hey, if young folk would suck up 1% of their time to old rotten bastards with money and leave the other 99% to posting their mood (cloudy) or (disappointed) or (Kleenex-soft), it might pay off, rather than 100% to mood posting. Just a thought. As a rotten old bastard myself, I like to think that some member of my extended family might not want to actually hunt me down and kill me right away.

Delusion probably, but I can dream.

So do you want to start poor, end rich, or start rich, end poor? We can do it either way.

[wickerwoman]

55. I didn't say they're the poorest, I said they're one of the most vulnerable.

A 21 year old kid making $12,000 a year can probably get a second job. He is more likely to make more as time goes on. He can get student loans and go back to school. There's a pretty good chance he'll get married soon and have a second income stream to add to his. Worst case scenario, he can go out and steal what he needs. None of those are really options for the 66 year old. If they have an unusually high heating bill or need more drugs or have to take a cab across town to a medical appointment and they don't have the money they just have to lump it, sinking further and further into poverty. And once a senior does fall into poverty it is virtually impossible for them to ever get out of it without assistance.

Plus, poor seniors then become a drag on their children who have to support both them and their own children. So helping seniors helps all ages. If my parents didn't get the benefits they do and have the insurance they do, either me or my brother would have to drop out of the work force to take care of them full time. We couldn't afford to put them in a nursing facility. And in my field and with the current economic climate, if I dropped out, I would never get back in. Our whole family would be impoverished by my dad's medical bills.

I think the point stands that setting kids against seniors doesn't get us anywhere and plays into the Republicans' plan to set us against each other while they rip us off.

[lumberjack_jeff]

37. The solution is simple. Raise taxes.

[bossy22]

47. yep

and we need to have that discussion. Reid is doing a disservice by ending all discussion on the issue.

[lumberjack_jeff]

51. And if Obama and Boehner get their way, they won't need to.

They're preference is to selectively default on workers.

[No Elephants]

67. If so, OASDI is way, way behind Bushco and Wall Street in

commandeering the future of the young and the unborn. Reid's participation in those things (and some others) is far more reprehensible in my eyes than his saying OASDI will be okay for 30 years, even if we do nothing.

[on point]

6. Finally, a Dem finds his backbone, stands up and speaks the truth.

If they want to reduce social security because they can't pay back all the T-bills it is holding, then I want the SAME cut-back for the Banksters and foreign countries that also hold T-bills.

That is if you plan to renege on paying back with interest the money borrowed form social security, then I want you to renege on paying back all T-bills. Let's see how that goes down in financial circles!

[Thornleylv]

8. Wonder how Sharon Angle would vote?

I am so glad I voted for Reid. I don't think people knee what was at stake in the last election but now they see

[siligut]

10. But he is willing to leave that open for change

He also rejected the idea of Independent Senator Bernie Sanders to require a two-thirds vote for any major change to social security.

"I have enough trouble over here with what the Republicans have done to me the last few congresses with the filibuster. That's 60. I don't need now to start worrying about 67. Let's change the subject, as much as I like Bernie, I will not support his legislation."

"At this stage in the development of this country, I will not support tinkering with social security. It is not an emergency."

Emphasis mine

http://www.businessinsider.com/harry-reid-social-security-video-2011-3

I am just not all-in with Harry as some seem to be.

[JDPriestly]

25. Harry Reid is right.

Focus on creating jobs and you won't need to cut Social Security.

First, if you create jobs, healthy older people will work longer and take their Social Security later by choice.

Second, if you create jobs, more people will pay into Social Security and the fund will grow.

There are two simple things we can do to create more jobs:

1) Adopt Jan Schakowsky's tax plan that will increase taxes on those earning over a million dollars a years.

2) Use the money to completely rebuild our energy systems so that we use solar and wind and water energy instead of the poisons -- oil, gas and nuclear.

Our current energy sources are literally killing us.

1/4 of our foreign trade debt is for importing energy. That is stupid. Importing energy that kills us. How stupid can we get?

[grahamhgreen]

26. Kick. Rinse and repeat.

[lovuian]

27. yes Harry you get it so hopefully your actions speak for your

words ...we will be watching

[lumberjack_jeff]

38. In this, Harry speaks for me. n/t

[Liberalynn]

39. At least someone is on our side n/t

[BlueIris]

59. Wow, that is such a bold statement. Deserving of such praise.

:sarcasm:

I refuse to get excited about an elected Democrat doing the bare minimum for his society.

[Overseas]

60. K&R! Yes Please! //nt