You seem to be arguing that when I send a check made in US funds to the US Treasury, the money vanishes. When does it vanish? The instant the government cashes the check. When it clears my bank? Or only if the funds are held past a certain time period. If the funds can be held for a fraction of a year (to pay general fund obligations) why can't they be held for 50 years to pay SS payouts?
Which would mean one of two things. Either you would have had to spend a lot more money on current payments (which would leave social security in the same mess it is in now, while making the regular budget deficit worse), or you would lower social security taxes. Lowering the taxes would have some positive effects but making the social security system more sound is not one of them.
You seem to be arguing that current SS income must equal current SS payouts. Why are you making that argument?
So I guess if I take all the money out of my 401K to go buy a Corvette my retirement is just fine because I owe the money to myself and because this is a loan it is an asswet to my retirement account??
Forget owing yourself the money, you own the Corvette. The 401K and the Corvette are both assets. Both may either increase or decrease in value. They do have different tax consequences. You must evaluate which is wisest for your retirement. BTW, aggressive IRA lawyers have ways of letting you own property from within an IRA. Are you trying to imply that I think you own both the Corvette + the loan, i.e. you doubled your money by making a purchase? Thats nuts!
It is not held and invested funds. Then vote to change that. This was my original point.
Please point out the effective difference between these two scenarios:
1) The government mandates all workers wages be taxed at 12% and sent to the US Treasury. The Treasury maintains an exact account for each individuals tax, and purchases T-bills. The government uses the T-bill proceeds in any fashion it does with such things. At maturity, the T-bills are redeemed by the government from whatever sources the government has at the maturity date (taxes, more T-bills, etc)
2) The government mandates all workers wages be taxed at 12% and deposited in individual investment accounts with registered financial institutions. These institutions do the relevant accounting, and purchase T-bills which they hold for the worker. The government uses the T-bill proceeds in any fashion it does with such things. At maturity, the T-bills are redeemed by the government from whatever sources the government has at the maturity date (taxes, more T-bills, etc)
Note that I stated exact individual accounts in both cases. This is the one effective difference I have been bashing to death with mindmeld, but surely you can see it is irrelevant in 1 or 2 above. The accounting can be either individual or collective in either case.
One of us is missing something in this discussion. |
