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Politics : Sharks in the Septic Tank
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To: Lane3 who wrote (21228)8/9/2001 5:47:49 PM
From: TimF  Read Replies (4) of 82486
 
I don't know about that. You might still have an obligation to pay yourself back if those were the terms you set for yourself.

If you want to consider the loan to yourself and asset then you also have to consider it a debt. The asset exactly equals the debt netting out at zero. Thus there is no asset to draw on. When I borrowed money from my 401K the 401K showed the loan as one of the "investments" in other words an asset, but I still had the cash, another asset. Of course in reality I was no richer then before, and I am not becoming poorer as I pay back the loan.

Ya know, it doesn't really matter as a practical matter, only as a political one. Uncle Sam can rationalize it either way.

Its a practical one in that the government will have to come up with new funds, or spend less when the SS tax no longer supports SS expenses. The actual date that the so called Social Security tax fund supposedly runs out of money is rather unimportant except perhaps as a matter of politics (which can make it important). The really important factor in terms of economics and finance is that the government has a huge obligation that Social Security taxes will no longer cover long before that date. I think the current estimate is 2017. I will be 49. Will I face a big regular federal tax increase to pay back the "trust fund"? Maybe I will get a big social security tax increase instead. Either way I am not looking forward to it.

Tim
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