Just the Facts, Ma'am: A Compendium of Liberal Fiction Message Board

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Politics : Just the Facts, Ma'am: A Compendium of Liberal Fiction

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To: Oeconomicus who wrote (26808)	1/17/2005 12:50:57 PM
From: Orcastraiter	Read Replies (1) of 90947

The debt I'm talking about is the additional debt to cover the transition costs to privatization. To cover the demographic shortfall there would need to be a reconciliation as well. I've heard that it could be made up with a modest tax increase or a modest reduction in benefits. I did not know we were writing IOU's to ourselves. What's the interest rate on that transaction? I really need to study the Social Security system some more. Seems to me that the program goes into the red some time in the next 20 to 40 years...depending on whose numbers you believe. At that point in time we need to borrow or reduce the cost of the program. Bush's proposal to privatize the system will divert money coming from younger folks away from the SS trust. That additional shortfall will need to be made up. Most folks are saying that will entail borrowing and interest payments. I still don't see how when this money is invested by individuals how it offsets this debt. Thanks for the discussion. Any links you can provide to help me understand how this new debt will be no problem due to all the new money looking to be invested will help. Thanks, Orca

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