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Politics : A US National Health Care System? -- Ignore unavailable to you. Want to Upgrade?

To: TimF who wrote (17047)	4/19/2010 2:37:58 PM
From: i-node	Read Replies (1) \| Respond to of 42652

Except there is no property right to future Social Security, Medicare, or Medicaid payments. A single act of congress could cancel all future spending on the programs. While your point is taken -- and it is a good one -- I will point out that the trustees have referred to it as an "unfunded liability", and their report is the de facto accounting for the trust. And all you say is true -- Congress could just declare SS to no longer exist, and that would be that. So, too, could they declare all public indebtedness to be null and void, yet, we still consider those as liabilities. In an accounting sense, the basic principles of accounting require conservatism and matching. Thus, a liability must be recorded at the earliest possible time, and the expenditures of an accounting period must be reported in same period as the matching revenues. Of course, this is governmental accounting -- which is all screwed up anyway -- and the federal government makes its own rules. But from a traditional accounting perspective, the fact that no direct claim exists should not, in any way, affect the accounting treatment -- so long as it is reasonable to anticipate the expenditure will be required and its amount is reasonably estimable (which this is). The money isn't "owed today" for payment in the future, it isn't owed at all. I would argue that it IS owed until such time as Congress acts to cancel that indebtedness; again, keeping in mind Congress could cancel any indebtedness of the government but we don't say "they aren't liabilities". The real essence of your post, I think, is that because no one individual has a claim against the assets of the US WRT SS, no liability exists. However, this is not a precondition to the need to consider a debt as a debt. It frequently occurs in business AND government that liabilities are established as to the obligation and amount, yet we don't quite know to whom the money will ultimately be disbursed. I understand your take on it but I disagree, if only fairly technical grounds.