News Who profits from the US national debt?

[Ivan Seeking]

So you wish to redirect the the blame his father? Okay that's true in part. We had to rob social security in order to fund Bush's cold war. I really thought the ability to destroy the planet ten time would have been enough, but according to Bush Sr we needed more nukes.

I was talking about the deficit created by Bush Jr since he took office - a good portion of which can be attributed directly to Bush lies and his phoney threat - Saddam.

 

[selfAdjoint]

See this study of Republican and Democratic presidents and their budgets by a budget maven. Wake up and smell the coffee!


(PDF, courtesy of maxspeak)

 

[Locrian]

Thanks for that link SelfAdjoint.

 

[russ_watters]

So you wish to redirect the the blame his father? Okay that's true in part. We had to rob social security in order to fund Bush's cold war.

If I thought you actually believed that, I'd respond. Since I know you know its rediculous, thoughtless rhetoric, I won't.

SA - an admittedly leftist website is not a good place for an unbiased argument. It only mentions SS in passing on page 5 and basically just says we need to pay off the obvious debt before we can pay off the hidden debt (SS/Medicare). To use the mortgage analogy he presented (but make it accurate), its as if we're paying it off like a credit card (paying the interest while the principle increases) and now we have to save extra money just to be able to keep making the interest payments.

Yeah, a billion here, a billion there - the yearly "deficit" (as people like to call it...) isn't a good thing. But we've got bigger fish to fry and ignoring it won't make it go away (though it might allow you to die and leave the problem to your children).

I'd really really like to know what you guys think is going to happen to Social Security/medicare in the next 20 years. Are you just hoping you'll be dead by then and won't have to deal with it?

Here's my proposal: end SS and medicare pay-ins today. Give people back (when they retire) what they paid in, inflation adjusted, and nothing more. That way, the real debt that no one wants to talk about will stop increasing immediately.

 

[onegermanbeerglass]

Russ, where do you propose to get the money from to perform your plan?

The money delegated for Social Security has been placed in government bonds which grow at less than 2% on average. Meanwhile, average economic growth for the U.S. is 2.98%. Thus, the money "used" for paying back social security is de-valued over time. This is where the problem lies with social security.

Additionally, if you eliminate social security, or simply pay back only what's paid in, you'll leave many older people destitute in a short time, and they will have to rely on entitlement programs, which in effect, further increases the national debt.


We have to work the problem out in a more efficient way and find the problems with our plans and create a greater plan to resolve the issues.

At some point here in the near future (hopefully today) I'll post "The Great Plan" and give a basic outline of my notion on where we need to go and how we need to get there, what the problems of my plan are, that I know of, and how we can overcome them.

 

[selfAdjoint]

The money delegated for Social Security has been placed in government bonds which grow at less than 2% on average

'Scuse me? During most of my lifetime 30 year treasuries have paid in the 7-9% range. They are currently depressed along with all other interest rates, but you can't use a current minimum to compare to a long-time average.

 

[onegermanbeerglass]

7-9% over 30 years, not annually and not compounded.

Meanwhile, with even only 2% inflation annually (which is far lower than average), we reach 10.41% when compounded after only 5 years.

Meanwhile, those treasury bonds are becoming de-valued.

 

[russ_watters]

I was being somewhat flip - I was trying to get some reaction (any reaction) to the social security problem. Yes, any such plan would require a gradual phase-in, likely over the course of a generation. Rough guess, but any phase-out would make the budget worse-off for a decade, but after that, far, far better off.

 

[onegermanbeerglass]

Refer to the great plan for fixing some of those budget problems. I'll be posting some info I've found to support that.