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Politics : The Trump Presidency -- Ignore unavailable to you. Want to Upgrade?

To: Wharf Rat who wrote (69590)	5/3/2018 1:08:54 PM
From: i-node	1 Recommendation Recommended By gamesmistress Respond to of 353784

>> I imagine the second person had almost the same deal. It's a lot different when you start putting in at age 18 or 20, like most of us do.. That's true, but the point of that remark was to show that it is possible in certain circumstances for it to be a welfare program. The reality is that one need only work 40 quarters (10 years) at minimum wage to qualify for a full benefit. >> " given that millions of people have paid into the system for decades, yet there are only funds sufficient to pay benefits for three years, " Wrong. Well, this is NOT wrong. The ~2.8 Trillion dollars current in the so-called "surplus" are sufficient to pay benefits required for less than 4 years (yes, more than 3). Monthly payout: 80.1 Billion. Amount in trust: 2.8 Trillion. Number of months = 2.8 Trillion / 80.1 Billion = 35.95 months. If this trust were properly funded, you should be able to go through those 36 months and still have money left to fund all current retirees until their deaths. >> No. Are people with union or corporate pensions welfare recipients? NO. THESE PLANS ARE HELD TO ENTIRELY DIFFERENT, ACCRUAL BASIS ACCOUNTING STANDARDS. My point entirely in your one question. Good job! (I caution you, I wrote my senior paper on APB 8, Accounting for the Cost of Pension Plans, and my knowledge was deadly back in the day. That it has long since been superseded, well, that's their loss...)

To: Wharf Rat who wrote (69590)	5/3/2018 2:59:29 PM
From: TimF	Read Replies (1) \| Respond to of 353784

No. Are people with union or corporate pensions welfare recipients? Those pensions have real investments were the return is supposed to cover the expenditures. They have problems too to the extent the pensions system under promises and under invests. From the perspective of the whole government there is no investment, one part owes another part and it cancels out. From the perspective of the SS program there is an investment, in treasury securities. But the investment isn't enough, promises were made that the investments can't cover. That first perspective, that of the government as whole, is very important here since the overall fiscal balance matters more than the balance in any particular program. If the overall fiscal situation was outstanding it wouldn't matter too much if a trust fund wasn't big enough to cover its promises because congress could just move the money around if there is enough demand for it to do so. Yes the law calls for money to be allocated a certain way but congress makes the laws. If OTOH the SS trust fund situation was outstanding, enough money listed in it to cover all projected future spending plus a lot more, but the overall fiscal situation of the country is horrible, than the system as a whole can start running out of money. The only way for the treasury to pay back the trust fund is from taxes. But there is a practical limit on how much tax revenue can be extracted, and there is normally a political limit that's lower than the maximum economic limit. If the treasury can't raise enough to pay back the trust fund then you have a problem. So its overall fiscal balance of the government as a whole that matters, much more than anything about the trust fund.