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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: bentway who wrote (209749)	11/28/2012 6:52:35 PM
From: cosmicforce	Respond to of 544083

I just don't believe that SS (or MediCare for that matter) will be available based upon how the assets have been moved off into IOUs and how large the obligation actually is. If my neighbor were to take a mortgage out through me, pay me in real dollars today and I were to promise to pay off a balloon payment in eight years, but was currently living beyond my means with their cash now, then they'd be rightly concerned if my answer to their inquiries was that I had enough IOUs floated to cover the payment. From Wiki: In 2009 the Office of the Chief Actuary of the Social Security Administration calculated an unfunded obligation of $15.1 trillion for the Social Security program. The unfunded obligation is the difference between the present value of the cost of Social Security and the present value of the assets in the Trust Fund and the future scheduled tax income of the program. In the Actuarial Note explaining the calculation, the Office of the Chief Actuary wrote that "The term obligation is used in lieu of the term liability, because liability generally indicates a contractual obligation (as in the case of private pensions and insurance) that cannot be altered by the plan sponsor without the agreement of the plan participants." That is a large number and is likely to grow if people live longer (though they aren't). For those with a head for numbers that is $5000 for every person alive today and that doesn't count the inflationary risk due to assets being moved into Treasuries. A number of things could interfere with SS as it is currently funded. Inflation due to the bloat of M3 (not counted anymore, BTW) is but one. Where are all these dollars the Treasury is buy debt coming from? If SS is actually given to middle class professionals such as myself, it will be a surprising windfall. I think there will be an overwhelming desire on the part of the politicians to put a means test in place, though, so truth in advertising says that this is really a tax to support those who didn't plan for retirement. Since I planned to not have it, I probably won't have it. That is weirdly ironic. I didn't take expensive vacations or buy a motor home on my 2nd or 3rd mortgage based upon inflated house prices and will be repaid for my financial continence with a means test for my due diligence. I recommend that anyone who cares how they will spend their retirement years treat SS as "speculative" as I do especially if they plan on retiring in 10 years or more.