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Politics : Politics for Pros- moderated

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From: rich evans	2/3/2005 11:36:23 AM
	Read Replies (2) of 793903

This social security debate in my opinion is stupid. It is a tax and SS surpluses have all been used spent for general gov expenses. As these surpluses decline less money is available to pay the Gov expenses and deficits increase. When SS tax can’t pay SS retirement costs in 2018, then the Goverment makes up the shortfall from its general revenues/budget. So what does it matter when the SS costs exceed SS tax revenues. Or when the gov notes are paid and gone. All payments come from the government from its total taxes collected whether SS tax or income tax etc, and the SS accounting is just that : an accounting entry only. The issue is can the government as a whole under its tax revenues and budget costs afford the projected SS costs .Paying the SS notes or paying unfunded liabilities resulting from SS promises makes no difference. It is a fiction to think their is a trust fund. You could throw away the SS notes held and the Gov would just pay the same amount yearly into SS to make up any shortfalls just as it has taken the money when their were surplus SS taxes revenues over payouts to the system. Assuming 3.5% growth average, GNP doubles in 20 years. If all fed taxes represent 20% of GNP then we have tax revs of say about 5 trill in 20 years. Can we afford SS as part of this total government rev/budget? Who knows? Privatising some of SS is just a reduction in taxes for some of the younger of us and a reduction in future SS liabilities for government . It does not add to the Government debt. It just changes the form to a promissory note on the SS books from an an unfunded liability off the books. It does not matter whether these liabilities are shown on balance sheet as gov notes or are unfunded liabilities offthe balance sheet .So the whole SS discussions are based on fictions. We should have discussions which are based on reality not fiction. So the whole thing is stupid politics IMO. The issue is whether you as a younger person want to be dependent on Gov promises in the future which would haveto be funded by more taxes. deficits or reduced promises or have part of your retiremeent funded by your own nest egg thru a complusory savings plan from reducing your social security taxes with reduced promised future SS benefits made up with your own privately owned retirement account. Rich

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