The case against Social Security.

[Andrew77]

Entitlements could be reduced somewhat.

I agree. We should produce certain our own goods here in America for security reasons. That said we can import lots of stuff as long as our exports balance it out so there is no deficit. As it is $5-6Billion leaves which results in the borrowing that is the debt.

If they spend the money it's a positive. Also when someone retires we don't expect them to keep working.

No, the money the leaving doesn't result in debt. Us borrowing, results in debt. If we didn't borrow.... there would not be any debt.

If we had a $100 Billion dollar trade surplus, and the government spent more money than it collects in taxes, there would be more borrowing, and more debt.

If we had a $100 Billion dollar trade deficit, and the government spent less money, than it collected in taxes, there would be no borrowing, and no debt.

Trade deficits, have absolutely nothing whatsoever, to do with debt or borrowing. Nothing.

I don't see any goods that we don't produce in the US, that we need for security reasons. What exactly do you think we do not produce here?

By the way....

I want to thank you personally, for being decent and up right in talking to me. I appreciate anyone who can disagree on topics, without being emotional and mean about. It's obvious we'll never come to a consensus because our world views are entirely different, yet I think we have both been civil to each other. I wanted you to know that I appreciate it on your part.

 

[OldWiseGuy]

Which would lead to the problem I listed before.

What can they do with those dollars? They can't buy anything back home with US dollars. They would have to once again, buy US goods, invest in the US market, or something, because they can't pay their works with US dollars, or buy supplies with US dollars.

So no matter what they do with that money, it still has to come back.

In the mean time, that investment creates jobs and growth, and domestic product, all of which create wealth in this country.

They can spend U.S. dollars anywhere there is an exchange bank that accepts them. And because of the strength and security of our dollars they are sought for all over the world. They never have to come back. That's the problem.

 

[OldWiseGuy]

No, the money the leaving doesn't result in debt. Us borrowing, results in debt. If we didn't borrow.... there would not be any debt.

If we had a $100 Billion dollar trade surplus, and the government spent more money than it collects in taxes, there would be more borrowing, and more debt.

If we had a $100 Billion dollar trade deficit, and the government spent less money, than it collected in taxes, there would be no borrowing, and no debt.

Trade deficits, have absolutely nothing whatsoever, to do with debt or borrowing. Nothing.

I don't see any goods that we don't produce in the US, that we need for security reasons. What exactly do you think we do not produce here?

Many such articles as this connecting the trade deficit with our national debt.

Is there a Relationship Between Our Trade Deficit and Our National Debt?

 

[Bumble Bee]

MOD HAT
This thread has been cleaned. Please refrain from flaming remarks. It is ok to disagree, but use the content of the post when refuting points instead of making personal digs.
MOD HAT OFF​

 

[Andrew77]

Many such articles as this connecting the trade deficit with our national debt.

Is there a Relationship Between Our Trade Deficit and Our National Debt?

Yeah there are hundreds of bonkers articles that say there is a connection, without providing the slightest bit of proof.

The idea that the trade deficit causes debt, is completely unsupportable.

If I buy a TV made in the US, or if I buy a TV made in China, what difference can that have on the national debt of the Federal Government?

None. Will it change how much taxes are paid? No, it won't. Whether I buy a TV made in Arizona, or made in Mexico, or made in China, will not change how much tax money the government collects, because every company operating in the US, has to follow the tax laws.

Equally, does where I buy the TV, have any effect on how much money the Federal government spends? No. There is absolutely no connection between where the TV is purchased from, and how much Social Security is paid out, or how much Medicare is paid out, or how much is spent on everything else.

So we've established there is no connection between how much tax money is collected, and we've established there is no connection to how much Federal money is spent.

Since the only two variable that have any effect on debt is, money collected, and money spent.... and we've established neither are affected by where you buy a product, then there is no possible way to connect a trade deficit with national debt.

 

[OldWiseGuy]

Yeah there are hundreds of bonkers articles that say there is a connection, without providing the slightest bit of proof.

The idea that the trade deficit causes debt, is completely unsupportable.

If I buy a TV made in the US, or if I buy a TV made in China, what difference can that have on the national debt of the Federal Government?

None. Will it change how much taxes are paid? No, it won't. Whether I buy a TV made in Arizona, or made in Mexico, or made in China, will not change how much tax money the government collects, because every company operating in the US, has to follow the tax laws.

Equally, does where I buy the TV, have any effect on how much money the Federal government spends? No. There is absolutely no connection between where the TV is purchased from, and how much Social Security is paid out, or how much Medicare is paid out, or how much is spent on everything else.

So we've established there is no connection between how much tax money is collected, and we've established there is no connection to how much Federal money is spent.

Since the only two variable that have any effect on debt is, money collected, and money spent.... and we've established neither are affected by where you buy a product, then there is no possible way to connect a trade deficit with national debt.

Money that leaves the economy through the trade deficit can't be taxed any more. That leaves the government short of needed revenue, thus the borrowing, thus the debt. Also those left jobless by the trade deficit also require more government spending on social programs to help them, which exacerbates the debt problem.

 

[Andrew77]

It seems that you have "established" lots of ideas that have little to do with the facts.

If you would like to explain how me buying a TV, from any given location, whether in my own state, or anywhere else.... has any effect on the Federal Budget, by all means enlighten me.

By the way, how do you explain other countries with a trade surplus and drastically increasing national debt?

China has a trade surplus. In 2008 the Chinese national debt was 27% of GDP, and now is 46.2%.

Clear trade surplus, and drastically increasing national debt.

Or Japan. Japan has for the last 2 years had an over all trade surplus.

Strong 2017 exports gave Japan a trade surplus again despite higher energy prices | The Japan Times

And yet...

Their debt-to-GDP is 250%. Which is more than double ours.

Venezuela also have a huge trade surplus, than their debt is high too. Now it doesn't seem like their debt is huge because their debt-to-GDP has been dropping, but that isn't because they paid off their debts. It's because they have been using oil to pay their debts. It's not because their economy is doing better and the government is collecting more tax money. They are practically a failed state, with mass starvation.

Now of course there are countries that are doing very well, and have a trade surplus. But then, I would expect this, because my contention is there is no connection between balance of trade, and national debt.

If there is no connection, then you should find a wide range of countries with various debt problems, and various balance of trade levels, and no real correlation between them. That's what we see. There are countries with trade deficits that do not have large national debt.

Again, there are two ways to reduce the trade deficit.

Either wipe out the economy so everyone is poor, and can't buy foreign goods anymore...

Or simply stop borrowing money. The number one reason foriegn countries buy bonds, is because our government is selling them. Stop demanding government pay for everything, and government will stop borrowing money to pay for everything you want. Then magically... people will find other things to buy with US Dollars than bonds.

What absolutely will not reduce the trade deficit, is imposing protectionism. Actually that's not entirely true, because protectionism will destroy the economy, and that will lead to the first solution. Make everyone poor, and they'll buy fewer imported goods.

 

[OldWiseGuy]

If you would like to explain how me buying a TV, from any given location, whether in my own state, or anywhere else.... has any effect on the Federal Budget, by all means enlighten me.

By the way, how do you explain other countries with a trade surplus and drastically increasing national debt?

View attachment 223383
China has a trade surplus. In 2008 the Chinese national debt was 27% of GDP, and now is 46.2%.

Clear trade surplus, and drastically increasing national debt.

Or Japan. Japan has for the last 2 years had an over all trade surplus.

Strong 2017 exports gave Japan a trade surplus again despite higher energy prices | The Japan Times

And yet...

View attachment 223384
Their debt-to-GDP is 250%. Which is more than double ours.

Venezuela also have a huge trade surplus, than their debt is high too. Now it doesn't seem like their debt is huge because their debt-to-GDP has been dropping, but that isn't because they paid off their debts. It's because they have been using oil to pay their debts. It's not because their economy is doing better and the government is collecting more tax money. They are practically a failed state, with mass starvation.

Now of course there are countries that are doing very well, and have a trade surplus. But then, I would expect this, because my contention is there is no connection between balance of trade, and national debt.

If there is no connection, then you should find a wide range of countries with various debt problems, and various balance of trade levels, and no real correlation between them. That's what we see. There are countries with trade deficits that do not have large national debt.

Again, there are two ways to reduce the trade deficit.

Either wipe out the economy so everyone is poor, and can't buy foreign goods anymore...

Or simply stop borrowing money. The number one reason foriegn countries buy bonds, is because our government is selling them. Stop demanding government pay for everything, and government will stop borrowing money to pay for everything you want. Then magically... people will find other things to buy with US Dollars than bonds.

What absolutely will not reduce the trade deficit, is imposing protectionism. Actually that's not entirely true, because protectionism will destroy the economy, and that will lead to the first solution. Make everyone poor, and they'll buy fewer imported goods.

I realize that it is all very confusing.

You do understand the debt can never be repaid. It can only be forgiven or repudiated. That's why God instructed Israel that debt be forgiven every seventh year.

I believe it is the individual's duty to be as debt-free as possible.

 

[Choir Loft]

Social Security is broke.

Social Security is literally, 100%, broke. There are no assets in Social Security. All money that is taxed away, is spent.

There is no account with Social Security money in it. The idea that social security has treasury bonds in it, is a joke.

It would be the same as you, holding a $50 dollar bill in your left hand. Then using your right hand, to write out on a note "I owe You $50". Then replacing the $50 in your left hand, with the IOU note you yourself wrote out with your right hand.... and then saying to yourself.... ok now I have an investment.

You.... owing.... you.... money, is not an investment.

In fact, even those IOUs that Social Security "buys" are fake. They are not even real.

A real Treasury bond, has value on the open market. We call them "marketable bonds".

What that means is, if you buy a bond, and the bond matures in 10 years, but you find that you really need the money in 5 years... you can sell that bond on the open market, and get money for it. It has value. Thus, it is a "marketable bond".

The 'treasury bonds' that Social Security has, are not even real bonds. They are in fact nothing more than paper saying the government, owes the government, money.

If we all rounded up a gang, and raided the Social Security administration, stealing all the 'treasury bonds' they have... we would walk away with a few dollars worth of paper. They have zero value. They can't be sold.

Andrew wrote a lot more about the subject and most of it is true as far as I know. The above quoted portion, however, is true but not accurate. By that I mean it's true as far as it goes, but it doesn't go far enough.

September 16, 1985 - US Commerce Department declares the United States a debtor nation.

There are a number of reasons why the US became a debtor nation, but only a few as to why it continues to be one. One of the excuses our oligarchs like to use to argue against Social Security benefits, that most Americans depend upon for retirement income, is that the system is going broke.

It is quite true that FICA is a tax to support a welfare system. What, I ask is wrong with that? All the industrialized nations of the world have an extensive welfare system. Most have socialized medicine which pays all or most healthcare costs with varying degrees of efficiency. The United States is the only nation that doesn't cover health care costs. In point of fact, there are fewer and fewer social programs that the US government does support. For example, gone are the days when mental health was a major concern. As a result we now witness mental cases who use guns to express their anguish and inability to function in a socially acceptable way. We blame the gun for this, not our irresponsible lack of treatment of our mentally ill. Ignoring a problem doesn't make it go away. One way or another we WILL pay - either in money or in blood, but we will pay.

By the way, most of the industrialized nations of the earth do not have a policy of global domination as does the United States. It costs a lot of money to conquer a planet.

The Bible says that it is required of Christians to support widows and families that have fallen on hard times and cannot support themselves. But our churches don't do that. They don't do it a little and they don't do it at all. Christmas dinners do not suffice to fill empty stomachs the rest of the year, but they do sauve a guilty conscience. Our churches do not perform their Biblical mandate because they are too indebted from their own excesses. Most churches have been financial and spiritually mismanaged and are incapable at this point of doing anything more than making superficial excuses for their slack attitude. They blame the democrats for social problems and embrace fascist governmental policy of eternal war and global aggression instead.

FACTS speak to the depletion of the Social Security fund. Facts show that both Democrats and Republicans have been dipping into the fund since 1985. Why? To finance an ever growing thirst for blood and to satiate an almost infinite hunger for war and the financial advantages that accrue to defense contractors, oil speculators and the drug lords of the intelligence community.

But good Christians, like the good Germans a generation before them, do not want to acknowledge that ours has become a criminal government. It subverts liberty, ignores public responsibility toward the poor and ill, and aggressively pursues murderous policy against any and every opponent of American global hegemony. Good Christians just want their Sunday dog and pony show, to sing a few songs glorifying their gods of war and to exit quickly to be first in line at the local steak house for dinner. Anything beyond that, as far as social responsibility is concerned, is not worthy of attention. Consequently our cities are falling into ruin, violence grows, our once great transportation infrastructure is crumbling, and the American ability to move forward into the future has been squelched. We are a nation of sheep being led to the shearers and slaughterers daily. We do nothing creative any more except to invent new more efficient ways to kill.

We ignore the facts and accept only half truths. Case in point is the half truth that Social Security funds are depleted because they've been spent on an increasing population of retirees. The truth is that Social Security money, like all the other money the government seizes from us is being spent on the military. America is now a fascist police state and such a government has the right to demand of its citizens anything it wants to further its illegal and immoral policies.

And good Christians sit idly by and say, "God is able". They think their buzz words mean God will bless anyway, but what it really means is that God will judge. So He has and so He will. Look around you. Do you see blessings or an increasing number of crisis disasters and curses? Hide your faces in your pillows. Ignore the truth. Maybe its just a bad dream and it will go away all by itself.

Or maybe it won't.

and that's me, hollering from the choir loft....

 

[Andrew77]

I realize that it is all very confusing.

You do understand the debt can never be repaid. It can only be forgiven or repudiated. That's why God instructed Israel that debt be forgiven every seventh year.

I believe it is the individual's duty to be as debt-free as possible.

That makes no sense. Back in the early 2000s, I had $12,000 worth of debt, due to some mindlessly stupid choices that I made.

My total yearly income was $19,000. For the next 5 years, I paid back every single dollar I owed, plus interest.

Debt can be repaid. I have done it. I went to the hospital without insurance, and got a large hospital bill too. I paid that debt as well.

The country has a moral duty to pay back it's debts. We need to do this. If we don't, our future is that of Argentina, Greece, and Spain. All of which are disasters.

Now I get it, you may not care what damage you do to your kids, and their kids, because you won't be here to see it.

But that is why younger people like me, are fighting the older generation like you, over this issue.

BTW....

You do know that the US is paying back bonds constantly, right? We have to borrow money, to pay back existing bonds. That's how the system works.

The moment we stop paying back those bonds, there will be a crisis in the bond market, because the value of all bonds will crash. Who wants to buy a bond that the government refuses to pay back?

When that happens, there will be no money for Social Security. Payments will drop, and likely very fast. Again, why do you think Obama said openly that if they didn't raise the debt ceiling, that Social Security would be cut? Because he understands how the system works, and that without borrowing, Social Security is screwed.

 

[OldWiseGuy]

That makes no sense. Back in the early 2000s, I had $12,000 worth of debt, due to some mindlessly stupid choices that I made.

My total yearly income was $19,000. For the next 5 years, I paid back every single dollar I owed, plus interest.

Debt can be repaid. I have done it. I went to the hospital without insurance, and got a large hospital bill too. I paid that debt as well.

Of course small debts can be repaid, but the general debts of nations cannot.

The country has a moral duty to pay back it's debts. We need to do this. If we don't, our future is that of Argentina, Greece, and Spain. All of which are disasters.

We are doing this.

Now I get it, you may not care what damage you do to your kids, and their kids, because you won't be here to see it.

My kids will inherit a small fortune.

But that is why younger people like me, are fighting the older generation like you, over this issue.

How, by running up huge student loan and consumer debts?

You do know that the US is paying back bonds constantly, right? We have to borrow money, to pay back existing bonds. That's how the system works.

Sure I do.

The moment we stop paying back those bonds, there will be a crisis in the bond market, because the value of all bonds will crash. Who wants to buy a bond that the government refuses to pay back?

We have never failed to pay our bond holders.

When that happens, there will be no money for Social Security. Payments will drop, and likely very fast. Again, why do you think Obama said openly that if they didn't raise the debt ceiling, that Social Security would be cut? Because he understands how the system works, and that without borrowing, Social Security is screwed.

Social Security would be the last entitlement to be cut, as the Trust Fund is upholding a good chunk of government spending. SS recipients generally need their benefits. Bond holders are usually more financially secure.

 

[Andrew77]

Andrew wrote a lot more about the subject and most of it is true as far as I know. The above quoted portion, however, is true but not accurate. By that I mean it's true as far as it goes, but it doesn't go far enough.

September 16, 1985 - US Commerce Department declares the United States a debtor nation.

There are a number of reasons why the US became a debtor nation, but only a few as to why it continues to be one. One of the excuses our oligarchs like to use to argue against Social Security benefits, that most Americans depend upon for retirement income, is that the system is going broke.

It is quite true that FICA is a tax to support a welfare system. What, I ask is wrong with that? All the industrialized nations of the world have an extensive welfare system. Most have socialized medicine which pays all or most healthcare costs with varying degrees of efficiency. The United States is the only nation that doesn't cover health care costs. In point of fact, there are fewer and fewer social programs that the US government does support. For example, gone are the days when mental health was a major concern. As a result we now witness mental cases who use guns to express their anguish and inability to function in a socially acceptable way. We blame the gun for this, not our irresponsible lack of treatment of our mentally ill. Ignoring a problem doesn't make it go away. One way or another we WILL pay - either in money or in blood, but we will pay.

By the way, most of the industrialized nations of the earth do not have a policy of global domination as does the United States. It costs a lot of money to conquer a planet.

The Bible says that it is required of Christians to support widows and families that have fallen on hard times and cannot support themselves. But our churches don't do that. They don't do it a little and they don't do it at all. Christmas dinners do not suffice to fill empty stomachs the rest of the year, but they do sauve a guilty conscience. Our churches do not perform their Biblical mandate because they are too indebted from their own excesses. Most churches have been financial and spiritually mismanaged and are incapable at this point of doing anything more than making superficial excuses for their slack attitude. They blame the democrats for social problems and embrace fascist governmental policy of eternal war and global aggression instead.

FACTS speak to the depletion of the Social Security fund. Facts show that both Democrats and Republicans have been dipping into the fund since 1985. Why? To finance an ever growing thirst for blood and to satiate an almost infinite hunger for war and the financial advantages that accrue to defense contractors, oil speculators and the drug lords of the intelligence community.

But good Christians, like the good Germans a generation before them, do not want to acknowledge that ours has become a criminal government. It subverts liberty, ignores public responsibility toward the poor and ill, and aggressively pursues murderous policy against any and every opponent of American global hegemony. Good Christians just want their Sunday dog and pony show, to sing a few songs glorifying their gods of war and to exit quickly to be first in line at the local steak house for dinner. Anything beyond that, as far as social responsibility is concerned, is not worthy of attention. Consequently our cities are falling into ruin, violence grows, our once great transportation infrastructure is crumbling, and the American ability to move forward into the future has been squelched. We are a nation of sheep being led to the shearers and slaughterers daily. We do nothing creative any more except to invent new more efficient ways to kill.

We ignore the facts and accept only half truths. Case in point is the half truth that Social Security funds are depleted because they've been spent on an increasing population of retirees. The truth is that Social Security money, like all the other money the government seizes from us is being spent on the military. America is now a fascist police state and such a government has the right to demand of its citizens anything it wants to further its illegal and immoral policies.

And good Christians sit idly by and say, "God is able". They think their buzz words mean God will bless anyway, but what it really means is that God will judge. So He has and so He will. Look around you. Do you see blessings or an increasing number of crisis disasters and curses? Hide your faces in your pillows. Ignore the truth. Maybe its just a bad dream and it will go away all by itself.

Or maybe it won't.

and that's me, hollering from the choir loft....

The problem with mental health, is that there really is no cure. Some people are simply not curable. Equally, if you can imagine dealing with a mental patient, is entirely different than dealing with Momma and her cancer. Dealing with mental patients is extremely difficult, and the doctors and nurses become very jaded because there is no solution. You can put up with someone difficult for a long time, if you know that at the end they will be healed. But if you know they will never get better no matter what you do, and this will be your doom to put up with them for the rest of your life, you become very cynical and uncaring.

This is a government run, and paid for hospital. The way this dying woman was treated, is unfortunately very common.

I personally delivered medication to institutions such as this, and the attitude and mentality of the people working in these places, is pretty typical of what you see in the video.

In the 1930s though the 1950s, it was the job of the states to provide mental health services.
In the 1960s, that idiot JFK nationalized mental health care, which ruined the system, because the states said "fantastic!" and stopped providing support. The Federal government sucks at pretty much everything it does, and the result was terrible institutions.

This was a wonderful win for the states, because they didn't want to pay for it, and when there was problems no one could blame the state. They could say "it's so-and-so president's fault".

Win for all the state politicians, complete fail for the public, both patients and tax payers. By most estimates the Fed was paying far more, for far worse mental health care.

That's why all the mental institutions were complete disasters. You end up with books like "One flew over the cuckoo's nest", and pop culture with characters like Nurse Ratchet.

These hospitals were so bad, that even the doctors themselves, were arguing that they needed closed.

My point in saying all this, is that it's really easy for people on political discussion forums, to say that we need to have more mental health spending. Little bit harder to actually come up with a real solution. Why don't more states want to pick up the tab? Because then they will be held accountable when patients are abused.

Right now they just say "hey the feds let these people out! It's their fault!".

This is one of the main reasons we on the right-wing, don't want government involved in anything. Because when they get involved, they screw everything up, and then you can never get back to where you were. The state run institutions were better managed, and more cost-effective, but you don't see anyone pushing that. Instead we need some ignorant bureaucrats in Washington to run them.

 

[Andrew77]

Of course small debts can be repaid, but the general debts of nations cannot.

We are doing this.

My kids will inherit a small fortune.

How, by running up huge student loan and consumer debts?

Sure I do.

We have never failed to pay our bond holders.

Social Security would be the last entitlement to be cut, as the Trust Fund is upholding a good chunk of government spending. SS recipients generally need their benefits. Bond holders are usually more financially secure.

There is logically, no reason the national debt can't be repaid. There were a number of times in US history where the debt was being paid down, and if fiscal conservatives had remained in charge, the debt would have easily been eliminated. Especially after WW1, and WW2, they greatly reduced the national debt.

For example, after the American Civil war, we had $2.7 billion in debt. By 1891, by continuously paying down year after year, we only had $1.5 Billion of debt left.

There is no rational reason to believe that if we had a greater policy of paying down debt, and had continued to pay down the debt, that they would not eventually pay it down to zero.

We are doing this.

You just said we can't. Now you say we are?
True or false: In 2008 the national debt was $10 trillion, and today it is $21 Trillion?
If that is true, then I would equally claim your statement is false.

My kids will inherit a small fortune.

Which they will lose in taxes, to pay down debts like Social Security and Medicare.

Someone has to pay those bills. It can't come from the poor. So it will end up being from your kids who have the money you earned, while driving up debts on society.

Who exactly do you think is going to pay those bills? You said earlier that the administration of Social Security had plans to fix the system. Well... those plans include cutting benefits and increasing taxes. Who do you think they are going to increase taxes on? Your kids. Who do you think they will cut benefits for? Your kids.

You think the politicians are going to raise taxes and lower benefits on their own retirement? Of course not. You think it's going to be the super wealthy? Of course not. They'll leave the US, just like the wealthy of California moved out of the state, and just like the wealthy of Greece left Greece, and the wealthy of Venezuela left Venezuela, and even the wealthy of France left France.

Wealth tax forces 12,000 millionaires A YEAR out of France | Daily Mail Online

They are not going to pay for it. No... your kids are going to pay for it. Or their kids. But at some point, someone is going to have to pay the bill. And it's not the poor, living off welfare, and not the rich, and not the politicians.

How, by running up huge student loan and consumer debts?

That statement made no sense. What does that have to do with anything? How does that relate to this conversation, or the cost of tea in China? For the record I have zero debt on anything. And I have no student loans.

But I don't see how that fits into anything.

We have never failed to pay our bond holders.

Greece and dozen other countries all said the same thing. Until they failed to pay their bond holders.

At some point when you keep borrowing more and more money, you will eventually fail to pay your bond holders.

Just like if you live your life constantly borrowing money every single month to make ends meet... you might last a long time if you get enough cards and move the balances around constantly, but at some point you will go broke.

Social Security would be the last entitlement to be cut, as the Trust Fund is upholding a good chunk of government spending. SS recipients generally need their benefits. Bond holders are usually more financially secure.

Again, the moment that bond holders are denied payment, Social Security is broke anyway, along with the entire Federal Government.

If they default on bonds, the entire governmental system collapses. The deficit right now is over $400 billion. Suddenly they can't borrow money. Now there is a shortage of cash across the entire system. All the state governments that have Federal bonds, will now also be in fiscal crisis, because many states rely on those bonds. Union pensions with government bonds will also be in crisis.

Over and over, across the entire country, the Federal government defaulting on a bond, would cause nation wide fiscal panic.

Alternatively, no one has a legal right, whatsoever, to social security. You can't sue them. You can't take them to court. You can't argue about it. You can't do anything.

As a bond holder, I can sue the US government in international court. Now obviously I personally wouldn't because it wouldn't be worth the cost, but pension funds, state and local governments, and foreign governments can sue the US government if they fail to pay a bond. This has happened. This is Greece, and Venezuela, and Argentina, and on and on.

So if the Federal government simply doesn't have enough cash to pay everyone.... Social Security will be cut first, before bond holders.

Life isn't about "who needs it". That's political nonsense, made up by politicians who want votes.

In reality, life is run by who does right, and has legal rights. Living your life on the backs of working people, is not living right. And bond holders have legal rights, while social security recipients do not.

 

[OldWiseGuy]

That statement made no sense. What does that have to do with anything? How does that relate to this conversation, or the cost of tea in China? For the record I have zero debt on anything. And I have no student loans.

But I don't see how that fits into anything.

https://studentloanhero.com/student-loan-debt-statistics/

Most student loans are guaranteed by the government. If students default (and many will) the government will have to pay the banks, which will increase the national debt. And, student debt is increasing overall as more and more kids obtain these not-very-well-thought-out loans.

So until the next generation(s) clean up their own financial mess they can do little to clean ours up.

 

[Andrew77]

https://studentloanhero.com/student-loan-debt-statistics/

Most student loans are guaranteed by the government. If students default (and many will) the government will have to pay the banks, which will increase the national debt. And, student debt is increasing overall as more and more kids obtain these not-very-well-thought-out loans.

So until the next generation(s) clean up their own financial mess they can do little to clean ours up.

That's a very bad way of thinking. Your idea is, if you won't live better, then I won't even try myself?
Again, sounds like the mentality the led to Greece imploding. Each group of people kicked the can down the road, until there was no road left, and people were impoverished and starving.

Regardless, those two things are not very similar.

You point out that total student loans is over $1.4 Trillion. True.

But how much down the entire program actually cost on the Federal Budget? How much debt is created?

The entire cost of the whole program, including paying administrative fees to Government union employees to shuffle papers around.... is $23 Billion dollars.

Compare that to the $1.2 Trillion for Socialist Insecurity, and $1 Trillion for Mediscare.

Now don't get me wrong. I agree that we shouldn't have student loan programs. It's horrible system that makes things worse. It increases the cost of education, traps students in decades of debt, and causes students to make terrible educational choices. Tons of bad, very little good.

But let's be real.... If you actually want to stop bad nation destroying fiscal policy, you can't blame a $23 Billion dollar program, for $400 Billion in government borrowing.

Never mind the fact that Social Security, and Medicare, have a combined unfunded liabilities of over $100 Trillion. The Student loan program, does not. Not comparable.

 

[OldWiseGuy]

That's a very bad way of thinking. Your idea is, if you won't live better, then I won't even try myself?
Again, sounds like the mentality the led to Greece imploding. Each group of people kicked the can down the road, until there was no road left, and people were impoverished and starving.

Regardless, those two things are not very similar.

You point out that total student loans is over $1.4 Trillion. True.

But how much down the entire program actually cost on the Federal Budget? How much debt is created?

The entire cost of the whole program, including paying administrative fees to Government union employees to shuffle papers around.... is $23 Billion dollars.

Compare that to the $1.2 Trillion for Socialist Insecurity, and $1 Trillion for Mediscare.

Now don't get me wrong. I agree that we shouldn't have student loan programs. It's horrible system that makes things worse. It increases the cost of education, traps students in decades of debt, and causes students to make terrible educational choices. Tons of bad, very little good.

But let's be real.... If you actually want to stop bad nation destroying fiscal policy, you can't blame a $23 Billion dollar program, for $400 Billion in government borrowing.

Never mind the fact that Social Security, and Medicare, have a combined unfunded liabilities of over $100 Trillion. The Student loan program, does not. Not comparable.

A 40 percent student loan default rate is predicted. That's $560Billion the government will have to cover, which will be added to the national debt.

By defaulting on their loans the kids (I call them kids) not only get free tuition, but books, meals, housing, and Lord only knows what else they spend the money on. Bernie would be proud.

Opinion | Projections for student loan defaults are terrifying. It's time to act.

 

[OldWiseGuy]

That's a very bad way of thinking. Your idea is, if you won't live better, then I won't even try myself?

I'm doing my part by setting the right example in all areas of life (even here on the forums).

 

[Andrew77]

A 40 percent student loan default rate is predicted. That's $560Billion the government will have to cover, which will be added to the national debt.

By defaulting on their loans the kids (I call them kids) not only get free tuition, but books, meals, housing, and Lord only knows what else they spend the money on. Bernie would be proud.

Opinion | Projections for student loan defaults are terrifying. It's time to act.

But that has remained true for ages. Yet the cost of the program is $23 Billion. So how do you explain that?

Very easy. You can't actually default on student loans. They will chase you for that money until you die. Literally.

If you default on you loans, they can garnish your wages without even going to court. The IRS will simply send a note to your employer, and you will instantly have a garnishment. No lawyers or accountants needed.

No one else can do that.

Equally they can confiscate your tax return as well. I actually had a roommate that had a baby in the hospital, without any money to pay. The government picked up that debt, and confiscated her tax return for the next 10 years. She paid back the entire debt, with the tax returns they confiscated from her.

My point is, there's a reason the program barely costs $23 Billion. It's because the only way to have the government actually lose money on the student loan program, is by a student spending all the money, and then living under a bridge.

If they work at Burger King, they'll get a tax return, and start taking money back. If they work anywhere that pays money, they'll garnish your wages. If they ever buy a house.... they'll put a lien on the house.

So one way, or another, unless they live under a bridge, the government will collect that money back. By the way, they can't bankrupt student loans either. If they declare bankruptcy, and owe $5,000 on a car, and $10,000 on student loans, you can't bankrupt the student loans and keep the car. They'll force you to sell the car, and make you pay back the student loans.

THey never go away. You must pay them back. This is why even with the 'default' rate on student loans, and even with them being over a $1 Trillion dollars, the cost of the program is barely $23 Billion. Not a thing. Not an issue.

Now, let's be honest. They could make it an issue. They could demand that government pay for education, and forgive student loans. That will make cutting social security even more likely, because how are we going to pay for that?

But that it all could change, and you'll be right. But as it is right now.... not a big issue. The big issue is Socalist Insecurity, and Mediscare.

 

[Andrew77]

I'm doing my part by setting the right example in all areas of life (even here on the forums).

Maybe so! But according to what you wrote, that came across very badly!

 

[chuckpeterson]

Social Security is broke.

Social Security is literally, 100%, broke. There are no assets in Social Security. All money that is taxed away, is spent.

There is no account with Social Security money in it. The idea that social security has treasury bonds in it, is a joke.

That is simply not true. Our federal government has been borrowing money from the Social security trust fund for decades. Our "government" now owes the SSTF over a trillion dollars and they continue to borrow from this trust fund.

facts are hard to deny