More McCain distortions

LOL, buting bonds huh ? Where did the cash go to ?

Trust fund

Main article: Social Security Trust Fund

Social Security taxes are paid into the Social Security Trust Fund maintained by the U.S. Treasury (technically, the "Federal Old-Age and Survivors Insurance Trust Fund", as established by 42 U.S.C. § 401(a)). Current year expenses are paid from current Social Security tax revenues. When revenues exceed expenditures, as they have in most years, the excess is invested in special series, non-marketable U.S. Government bonds, thus the Social Security Trust Fund indirectly finances the federal government's general purpose deficit spending. In 2007, the cumulative excess of Social Security taxes and interest received over benefits paid out stood at $2.2 trillion. [82] The Trust Fund is regarded by some as an accounting trick which holds no economic significance. Others argue that it has specific legal significance because the Treasury securities it holds are backed by the "full faith and credit" of the U.S. government, which has an obligation to repay its debt. It is important to note, however, that while the Treasury guarantees the interest and principal payments it makes to the Social Security Trust Fund, the benefit payments made from the Social Security Trust Fund to American retirees have no guarantee at all.

The Social Security Administration's authority to make benefit payments as granted by Congress extends only to its current revenues and existing Trust Fund balance, i.e., redemption of its holdings of Treasury securities. Therefore, Social Security's ability to make full payments once annual benefits exceed revenues depends in part on the federal government's ability to make good on the bonds that it has issued to the Social Security trust funds. The federal government's ability to repay Social Security, in turn, is contingent on fiscal policies taken today (which have tended to increase deficits and the percent of the budget spent on interest and principal payments) and in the future.

http://en.wikipedia.org/wiki/Social_Security_(United_States)
 
uscitizen said:
"We have to have some straight talk for America. The Social Security system is going to go broke. It will not be there for present day men and women who are working. And we have to fix it and we have to do it in a bipartisan fashion," the Arizona senator said Wednesday during a town hall meeting with running mate Sarah Palin in Grand Rapids, Mich.
http://apnews.myway.com/article/20080919/D93A2BIO1.html

Many approaching retirement age are still working and will get SS benefits.


the real problem is that the US govt owes around 3 trillion to SS and will have to start paying it back in about 8 yrs or so.

that will have to come out of general funds.
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Does the Jackass Party have anything else but fear mongering to run on?

I realize it your party's favorite tool and they are masters at using fear to win elections, especially while blaming R's for it at the same time....
but its getting old and boring....
 
Talk about projection.

We gotta bail out the market now, put Paulson in charge of 1 trillion dollars with no restrictions. Bail out the foreign banks too!

Doomed I tell you if we do not do it now.
 
uscitizen said:
Talk about projection.

We gotta bail out the market now, put Paulson in charge of 1 trillion dollars with no restrictions. Bail out the foreign banks too!

Doomed I tell you if we do not do it now.
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"We hope to move very quickly - time is of the essence," said House Speaker Nancy Pelosi, D-Calif., late Thursday night. :pke:
 
Pelosi Smelosi. that is what I am talking about. but I heard bush say it.

You think I am partisan ? Guess again gonzo. I just dislike republicans more than democrat politicians.

I would like to kick about 75% of the congress right in the balls.
 
And I heard Pelosi say this......whats your point ?

This crisis is very serious, thats a fact...

Obama's fear mongering about Soc. Sec. is bullshit...and that is also a fact....

being non-partisan, it must be easy for you to see the fuckin' difference....
 
bravo said:
And I heard Pelosi say this......whats your point ?

This crisis is very serious, thats a fact...

Obama's fear mongering about Soc. Sec. is bullshit...and that is also a fact....

being non-partisan, it must be easy for you to see the fuckin' difference....
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so was Bush's fearmongering about SS and most of the Republicans ?

The SS issue is real.
my opinion on the finincial crisis is that if they are not federally insured let em fail. And if they are to big to fail they are to big to let survive anyway.
They are clearly a threat to the USA.
 
uscitizen said:
LOL, buting bonds huh ? Where did the cash go to ?
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Yes, the SSI trust fund is invested in "bonds". The trick is which bonds do they buy and where does the cash go in the mean time?

Where does the cash go? It depends on which administration (and congress) was in charge at the time.

Prior to LBJ, the type of "bonds" purchased by the SSI trust Fund were short term U.S. Treasury Bills that matured in 3 months. The "cash" received by the general fund was simply KEPT in the general fund until the T-bills matured, and then was used (plus enough extra from the general fund to pay the interest) to buy back the matured bonds. That cash was then reinvested in more short term T-bills in an ongoing cycle in which the money was held for SSI in the general fund plus small infusions from interest payments due the matured T-bills.

What is needed at this point to understand is the difference between the general FUND, from which revenues were distributed to cover various debts, and the general BUDGET, which outlines how revenues coming into the government are spent. Money going into the general fund is not necessarily SPENT through the general budget, or indeed, necessarily spent at all, as was the case with SSI trust moneys invested in T-bills.

That changed with LBJ. Defending his move as a way for SSI trust funds to get more interest, LBJ moved the investment practice from short term U.S. Treasury Bills to long term U.S. Treasury Notes. Notes pay a higher interest rate, but do so by holding the money for years instead of months. That put SSI funds in the general fund for years at a time. The short term cycle was broken, and for the first time, SSI funds were transferred to the general BUDGET and spent on programs other than the SSI Trust Fund. The cash, ass you asked, was no longer held in the general fund to be ready to pay back the T-notes that were purchased.

The practice of including SSI funds from T-note purchases in the general budget continued through Nixon, Ford, and Reagan. The only significant change came under Reagan, where SSI contributions were pushed significantly upward, greatly increasing surplus funds. But the surplus continued to be spent on general budget programs. The other change is congress made the purchase of T-notes a legal requirement, where it had simply been tradition before, but since they ony made law what was already happening, that is not considered to (by most) to be a significant change. I do consider it a significant change, though, because now it will take another act of congress to remove that requirement.

One other factor of note is that while SSI funds were transferred to the general fund via T-notes, and then spent through the general budget, the bookkeeping kept it all above the board, and the debt to the SSI Trust Fund was acknowledged as a deficit in the general budget.

Bush Sr. took SSI funds back out of the budget. Like administrations prior to LBJ, he insisted funds received from the sale of T-notes be held to pay of the next set of T-notes. Of course, that put a big hole in the general fund available to the budget which could not be filled except by breaking his infamous "read my lips" promise.

Under Clinton SSI funds were put back into the budget almost immediately. THEN, after the republicans gained control over congress, the cooking began. Instead of being above board, and acknowledging the debt owed the SSI Trust Fund from spending the SSI funds, they pushed the fact under the table, using SSI surplus to bolster the general fund, and thereby showing a different ratio between revenues and expenditures. The "balanced budget" and "projected budget surplus" were the results of cooked books, and bore no relation to reality.

That was a point where Clinton and Gore differed greatly. Gore was a significant opponent of Clinton's use of SSI funds to "balance" the budget, and his criticism caused a rift between the president and VP. McCain supported Gore's view.

To sum up, it is indeed true that SSI trust Funds have always been put into U.S. Bonds, effectively transferring them to the general fund. However, it is NOT true that those funds were always SPENT. Some of the time since SSI's inception, the surplus funds were, indeed, spent on programs other than SSI. But some of the time, the cash was held in the general fund waiting for mature bonds to be cashed in. It was NOT spent on anything other than the SSI Trust Fund.

Today the funds are being spent. The U.S. government has a 3 trillion dollar commitment to the SSI Trust Fund, and it is growing daily. Additionally, the ratio of SS recipients is growing in relation to the contributors. Most economists agree that the ratio will continue to change until sometime in the future (when is continually argued), revenues will no longer exceed payments. At that time, the SSI Trust Fund comes into play. That is what the Trust Fund was designed to handle. But the Trust Fund is empty. Nothing in there but Treasury Notes. The general fund will be quickly overwhelmed and SSI will collapse.

That is what McCain is warning against. That is an issue McCain wants to address, so when the Trust Fund is needed, there is more in it than Treasury Notes. Obama acknowledges the threat, also. But his answer is to put more T-notes in the trust fund. He wants to increase SSI revenues, but has not outlined any plan to stop including them in the general budget.
 
uscitizen said:
Hmm judging from the fatct of our debt it would seem that all the general fund and lots more gets spent.
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Yes. It's called deficit spending, and has been ongoing since WWII.

Has nothing to do with SSI, though. Can add SSI in or take it out and hide it under the mattress, and deficit spending will continue. It's a separate issue that also needs to be addressed. But if you try to tie it to the SSI problem, neither will get solved.

And it still does not change the fact that you basically agree with McCain, while implying his speech on needing to address SSI is a "distortion".
 
I said mcCain was distorting and he was he said present day workers would not get SS. Many present day workers will get ss even in a worst case scenario.
 
uscitizen said:
I said mcCain was distorting and he was he said present day workers would not get SS. Many present day workers will get ss even in a worst case scenario.
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And if nothing is done, many present day workers will NOT get SS. If nothing is done, many present day workers will START getting SS and then, when it collapses, get cut off.

Had Obama said those exact words, and gotten attacked for the phrase "present day workers" you'd be right there pointing out he didn't say ALL present day workers. There are "present day workers" who have retired since he said those words. Are you implying he meant to include them, or the ones who will retire between now and the election?

Quit being a lying, spinning hack. No one expects anyone to change who they are going to vote for because McCain wants to make SSI and issue. But at least be minimally honest about it.
 
uscitizen said:
yeah minimally honest. that was my point for the thread. glad you finally caght on.
:clink:
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So, I can only suppose you have no problem with McCain's ads claiming Obama is going to raise taxes for everyone? After all, it is MINIMALLY honest, since Obama is going to raise taxes.

Or are you going to play second-grader with the "they did it first" defense?

You and Dixie are a pair. You just chose different parties to worship (and then deny it.)
 
uscitizen said:
ok Damo, if the ss surplus is taken off the budget but still spent.....

I will try this one more time since you are a republican and somewhat handicapped in the thought process area.

Didn't Reagan mess with the SS surplus on and off the budget too ?
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One more time.

The balanced budget amendment would not allow them to spend money over the amount they collect. (Except, I suspect in certain specified emergency situations.)

The separate bills to remove SS from the figures was to keep Congress from spending money that wasn't theirs to spend and thus ensure that SS will survive the spendthrift nature of both parties.

Both are fiscally responsible for different reasons. You are being deliberately obtuse, not "pushing the absurd".

If you cannot understand the concept of a Balanced Budget Amendment then you shouldn't be allowed anywhere near a ballot, ever. You are too stupid. Since I don't believe you are that stupid, this is deliberate and done with a purpose. Usually to attempt to misdirect and misrepresent.

Reagan continued the process that included the SS numbers in the General funds, he didn't exclude them, he included them. He did quite the opposite of what you claim. If you don't understand opposites, kindergarten may be where you need to be.

The bill to remove SS from the money considered theirs to spend would have fixed an issue that was continued and slightly increased by the Reagan Administration, increased again by Bush, and finalized under Clinton in order to have a projected "surplus", this again was still continued by Congress because once they get money into their hands they are never going to let it go.

That you don't understand the budget process is very clear.
 
In 2005, McCain also presented legislation (second time it was proposed to stop FM & FM with regulation, with the same result) that would have likely staved off this problem, or at least minimized it. Instead we find out that it was killed in committee by party-line vote, and one of the people who voted against it to kill it? None other than Barack Obama, we also find out that BO collected the 2nd most in Congress from FM&FM than any other Senator. That is an amazing amount considering how long he had been there.

Bought and paid for? You decide.
 
Damocles said:
In 2005, McCain also presented legislation (second time it was proposed to stop FM & FM with regulation, with the same result) that would have likely staved off this problem, or at least minimized it. Instead we find out that it was killed in committee by party-line vote, and one of the people who voted against it to kill it? None other than Barack Obama, we also find out that BO collected the 2nd most in Congress from FM&FM than any other Senator. That is an amazing amount considering how long he had been there.

Bought and paid for? You decide.
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Damo the independent, you sound like a McCain smear commercial.
 
Watermark said:
Damo the independent, you sound like a McCain smear commercial.
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Yeah...

But it was fun. And I've never claimed to be Independent. I have stated that I am not voting for McCain and have stated why I am not.

I am a republican, I have been for a long time. I work within my party to attempt to turn it back to the party of personal freedoms and responsibilities rather than the party who attempts to tell you who you can marry.

None of that means that I will support Obama.
 
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