CALLING ALL DU ECONOMIST/MONEY TYPES!!!!!!

[theophilus]

What would the status of Social Security be if our "government" had kept the box locked and not been putting SS money into the general account or whatever they have been doing for years? Has the government caused the upcoming shortfall? Has anyone apologized in the Senate or the House if they ( and their predecessors) have brought this problem on us?

Even with the boomers retiring, etc, would SS have had a problem if our "leaders" had done what ,basically, everyone thought they were doing: put the money for SS in an account and leave it alone?

I need help understanding how we got to this situation......Thanks.

[Cleita]

1. If they hadn't raided the money set aside for the baby boomers,

we would be singing in the rain. Even now there is nothing wrong with it that raising the cap couldn't fix. It would help Medicare too, which could run into problems.

The true intent of the White House is the Newt Gingrich plan to shoot it so full of holes that it dies and that's what they want. We should keep social plans out of the mitts of Washington, period, so they can't touch it.

Social Security, Medicare and all our other national health care plans shouldn't be tampered with, once they are set in motion, by Congress, the Executive Office or the Supreme Court. If a problem arises that is so huge it requires legislation, it should be put up to the people to vote on it. IMHO.

[theophilus]

2. Thanks for the info. It is truly appalling what our "elected"

"representatives" get up to. Anyway, if all this is the case, and I have heard about the cap a lot" are any Progressive Dems proposing these solutions? I feel like a true leader could really grab some limelight and proceed into the White House if he/she spoke forcefully on this issue. Americans don't want to have to work for someone else til they die. A solution to SS that even improves benefits would be what we need. A national health care plan would go a long way to solving a lot of these problems, too. Thanks again for the comments.

[ProfessorGAC]

3. It Would Be Fine, Except. . .

. . .there are some extrinsic consequences.

First, if the "lock box" took the money out of circulation, we'd print more money and trigger potential inflation.

Second, if the money is uninvested, there is no interest return, where today, the money is collecting interest on the notes held by the trust fund.

Now, if they used that money strictly as transfer funds for all social programs (save Medicare), while holding the budget to direct gov't spending, it would be solvent for at least another century.

The reason why it couldn't be done, however, is that it would have required the political courage to raise taxes to get revenues equal to expenses. Far too many federal legislators are in total fear of even mentioning tax increases. Hence, they just kept borrowing the other money.
The Professor

[theophilus]

6. I certainly agree there seems to be a total lack of will among our

leaders to raise taxes, or even cancel the Pretzldent's cuts, but isn't it possible that the majority of the people would be ok with the tax raising or cut reversal? I have seen several sources that say that if the messes can be fixed, even with higher taxes, then they should be fixed. Does the public have to "lead" in this? It is troubling that when polls are taken and the people overwhelmingly want something done, we hear from the Repugs, "Oh we don't listen to polls!" Meaning: we don't listen to the people. What can WE the people do?

[Cleita]

7. I would have to disagree with you on one point. I think by

a lock box, Gore meant that the funds would be taken out of the grab bag we have now and administered separately under the terms that a trust should be administered by. There still would be conservative investments in bonds, which would keep the money circulating.

[Oversea Visitor]

4. Whats the point

Money all gone
Look at deficits
Money all use up
Worst money allocated for many longterm projects
All Halibuton and Chimp friend
Deficit never take them into consideration
US a major train wreck

[hfojvt]

5. they had to do something with it

investing in government bonds is a good investment. It is only when some members of the government want to say "hey, tax payers, we are not going to pay you back" that it becomes a bad deal.

I had a huge objection when the media was talking about the government's "surplus" and the Clinton administration started this. Take the extra social securit money out of the equation and the government never had a surplus, certainly not a huge one. Yet, it was talk of the "surplus" which made Bush's tax cuts sound more feasible.

Of course, if the surplus had been put, say, in Swiss bank accounts, the media would be reporting larger deficits and a larger national debt. There would not be all this scurrilous talk about the surplus being "imaginary".