US Budget BasicsFollow

I, for one, think a few government condoned murders would spice up the place.

So get rid of social services and stay out of the bedroom. I guess I can get behind that policy if we can get unemployment below 5% and get healthcare under control.


I agree. Let's get out of the Middle East; if they want to kill each other off over there, let em.

Tulip,

Actually I am against the death penalty.



Timey,



Now if I had any std's or children or was married that might actually mean something. The fact that I would rather meet someone online than in a bar speaks volumes.

Yup, volumes like "I suck at picking up women in person, and don't want to put effort into meeting someone", "My physical characteristics are kinda unappealing, but I want someone sexy", and the ever popular "My social mannerisms and general belief structure will push away even the remotest human contact, but I am really lonely".

It's a veritable library of congress.

What happened to picking up coed's in your rockin' car?

Edited, Jan 31st 2011 4:29pm by Xsarus

I met my husband online. But not on a dating site.

Elton John played the piano too, and he didn't pick up chicks. Same with Freddie Mercury. Are you trying to tell us something?

Now you're catching on.

Well.... Moving right along!



Social Security is only half of the issue though. The "where the money comes from" part just lists "Social Security and other Payroll taxes", which is a strange way of writing it given that there are two primary forms of payroll taxes: Social Security and Medicare. Heck. You can look at any paystub you get from your employer and see them itemized. You can look at your W2 and see it as well. And it's doubly strange because the payroll taxes taken out for Medicare are about twice as much as those taken for Social Security. So relegating Medicare payroll taxes to "other" is a whitewash.

Anywho... If you compare the amount of income for "social security and medicareother" to the combined costs of social security and medicare (and madicaid, since it's also paid out from the same funds in theory), it's kinda clear where the problem is. And while Smash might like to just say it's all money from/to the same big bucket, when those programs were created, it was with the promise that they would be separately taxed with the proceeds to go just to those programs and not into a general fund. That's why we created those payroll taxes in the first place.




Except that you understand that treasury bills when used intergovernmentally like that *are* just accounting IOUs? See, the problem is that there's a difference between when a third party spends its money buying T-bills and when the government buys them from itself. When the government buys them from itself, it's just an accounting measure used to shift money from one program that has an excess of funds to a general fund, from which it can be spent on other things. Now, in the case of programs assumed to operate off a yearly budget for which each year's revenue pays for each year's spending, any excess isn't needed. It's an actual surplus which can be re-allocated. And at some future point, we can just administratively cancel out those T-bills and balance the books.

But in the case of Social Security, they need to retain the actual balances over time. We can't just balance the books administratively. So we've taken the money and invested it in ourselves, and then spent it on other things. It's not there. So instead of saving up the surpluses in some way (and I agree it should be invested instead of just sitting in a box), we have spent the money. When the ratio of people paying into social security to those drawing on it shift (as it is right now), we wont have that extra money and will have to find other means to generate the revenue (like raising taxes in some way).


Social security on paper wont run out of money. However, in order to pay Social security back for all the money we (the US government that is) borrowed from it over the years, we'll have to come up with the revenue to pay it. At the end of the day, Smash is right in one way: The total amount of money has to be paid. Had we invested that money into say the stock market, or other countries bonds, or pretty much anything, we could take those investments and cash them in for their dollar value. But since we put them into our own treasury bills, in order to cash it out, we have to pay ourselves back. With interest. Um... But we didn't invest the money we took. It's just gone. Someone has to pay for that.


What we've done with social security is like setting up a college fund for your kid. You decide to set aside $100 each month to put into that fund. You figure that over 18 years, you'll have put ~21k in there. Then you realize you should invest it so it'll be worth even more. But instead of investing it in something else, you "invest" it in your own household. So you take the $100 out of the account each month and spend it on your monthly budget, replacing the $100 with a certificate in "house-bucks" worth $150 in 18 years. Then you spend the $100 on whatever you need at the time.


Is anyone stupid enough to think that they're actually investing when they do this? When your kid turns 18 and wants her $30,000 to help her go to college, aren't you going to have to come up with the $30k somehow? I mean, she's got all these notes worth $150 each. She can just cash them in, right? Except you have to come up with the cash. And you didn't invest the money, so it's gone.


That's what's happening with Social Security. We "invested" it in a way that is suspiciously just like "spending". The only return one can expect is larger tax revenue to pay back the money that was borrowed. Um... But I'm pretty sure that the money spent from the social security and medicare funds didn't magically and all by themselves add about 4% yearly growth to our tax base. Thus, without actually raising taxes in other areas, we can't pay off the amount we will owe over time.

Edited, Jan 31st 2011 6:27pm by gbaji

While I really would like to be Flea when I grow up, I'm afraid you've got the wrong couple.