Actual U.S. Debt

[DustinG]

I don't know how many of you have seen this, but this makes the Tea Parties even more important.

[ame=http://www.youtube.com/watch?v=oVOuC0qSrR8]YouTube - $78.8 Trillion; United States Debt Obligations exceed world GDP; Monetary Collapse Looming?[/ame]

 

[nobletucky]

Good scary video.
It was nice to hear the word billion!

 

[antsi]

If you are concerned about this issue, watch the video in my sig line.

Same numbers; more detail.

We have a major failure of political leadership in this country.
Historically the Democrats have said, "Don't worry, the government will buy everything you want or need."
Historically the Republicans have said, "We can lower your taxes and still pay for all that stuff the Democrats promised you."
Now both sides are doing both: Bush's Medicare Part B will wind up being the largest medicare expenditure, and will add tremendously to our debt. Obama's spending money like water, and talking about tax cuts too.

The net result is that we are living beyond our means, and leaving a massive debt tab for our kids and grandkids. They will not have the same standard of living that we had.

I can think of nothing more abhorrent than parents making selfish decisions to severely damage their kids' future, but that is exactly what we are doing.

 

[Lucas156]

term limits!!!

 

[nobletucky]

antsi:
Just watched the video you recommended.
Thank You.
That link will get passed along. It is a fairly simple explaination for our kids to watch and understand.
http://www.iousathemovie.com/ = A must see.

 

[Feign]

Wow. An entire year.

 

[nobletucky]

So what sould we say to our kids when they get there first job and ask what the social security deduction is for?

 

[jedi]

Oh that video is so incorrect.
The Social Security number is wrong becuase those future generations are NEVER going to see Social Security.


The 2008 GAO report on Social Security advised the following:

• 2014 Medicare will operate in the RED meaning there is NO MORE MONEY TO PAY all those medicare bills.
• 2047 Social Scurity will operate in the RED meaning there is NO MORE MONEY TO PAY everyone on Social Scurity

The latest GAO report when taking into account what our government has done since I6BO took over shows a much dimmer image.

http://www.socialsecurity.org/
Note I highlighted some things for you to read and see my comments at the end.

Social Security Is Running a Surplus…Oops
By Michael Tanner

For years, opponents of Social Security reform have told us that there is no need to rush into changing the program because, after all, Social Security is running a surplus today. Well, according to a new report by the Congressional Budget Office, not so much.

CBO reports that the Social Security surplus, originally expected to be $80-90 billion this year and next will shrink to $16 billion this year and just $3 billion next year (essentially a rounding error) as a result of the recession and rising unemployment. And those estimates may be far too optimistic. In February of this year, for example, Social Security actually ran a deficit — spending more than it took in through taxes and interest combined.

And, while CBO expects a return to modest surpluses after 2010, as the recession ends and unemployment falls, that is betting on the success of the unproven Obama economic program. If unemployment stays at current levels, Social Security will begin running permanent cash flow deficits in 2011 (eight years earlier than previously predicted).

Opponents of personal accounts have pointed out recent declines in the stock market as a reason why private investment should no longer be considered an option for Social Security reform. The evidence suggests that, even with recent market declines, private investment would still produce higher returns than Social Security. The new surplus numbers provide yet another lesson: if the economy is in such a mess that it hurts private investment, traditional Social Security isn't going to be in any better shape.
The case for personal accounts remains as strong as ever.

However here is the major problem with Social Security that the media won't touch and GAO ignores per the rules given to it in working these reports.

Right now nobletucky (thanks for being the example! ) works and from his paycheck $50 is deducted for FICA (Social Security& Medicare). Those $50 would go to Uncle Sam and Uncle Sam would put them into a Social Security "savings" account. When FDR created the program that is how the "cash flow" was handled. Howeve as the time passed as the Social Security "savings" account got bigger and bigger Congress just could not resist and began to dip into it!

To dip into it the Social Security "Savings" account buys a US Government Bond which it then holds. Now think about this for a minute. What is wrong with this picture?

Okay let me explain it in much simpler terms. What is a bond? It's a piece of paper that someone gives you in exchange for CASH now with a promise that in "x" years you will get the face value of the bond. If you buy a $100 bond you pay $25 now and wait 10 years and then can cash it (give it back to the person that gave it to you) for $100. It's a formal I.O.U in essence and it works provided you have two different parties.

That is the problem here. The government is giving itself an I.O.U in exchange for the Social Security money it has. I know some of you have done this in your personal bank accounts. Especially if you have a checking and savings account. You will pull $50 out of savings and move to checking to cover the food expense for the month and tell yourself at the end of the month I'll pay back the $50 to savings that I owe myself.

Does it work? Be honest? Plus if you were savings $50 per month when this month ends do you put $100 ($50 you owed + $50 for the month) in savings or is that just way too much? Most people either don't pay themselves due to other stuff coming up or pay only the $50 they owed themselveseven though it's now $100.

So back to the point of Social Security. If you were to go to the Social Security Savings account all you are going to find at this point are a bunch of US Government Bonds (I.O.Us)! With the government in essense broke can the government really pay itself?

Hum... No!
Thus we must either
1) Kill social security
2) Change the social security laws (you can not collect untit 75 for example)
3) Print more money

1 and 2 are POLITICAL SUICIDE for anyone to touch. It's the same as removing the Machine Gun ban.

However by 2012 Social Security is going to be in deep, deep, deep trouble and congress is going to have to act. If they do the American public is going to be pissed at them and probably kick them out. If they do nothing, Social Security IS NOT going to be able to pay everyone and guess what Congress is going to get kicked out.

In essence 2012 is really the end of the world as we know it. Congress shows no interest in touching this, I6BO is not going to touch it either, but alas Congress for many years has been pushing and pusing this back but 2012 is the FINAL YEAR in which all the not doing anything will finally come to a boil.