It's Official: Social Security System Now in the Red

[TRWXXA]

Social Security System Operating at a Deficit, But Health-Care Overhaul May Boost Medicare - DailyFinance

Trustees Report Summary

No way!!! I got a letter from the Social Security Administration earlier this year promising me over $1200 per month after I turn 67. The government would never lie to me.

 

[6birds]

Awww damn, I was going to use SS monies to buy gum for the grandkids... I guess I'll have to budget some other way. If there are still people out there planning on this for retirement...

 

[hornadylnl]

If there are still people out there planning on this for retirement...

Social Security for retirement? I'm not planning on receiving a dime from my 401K either. I'm sure it will need to be redistributed for the greater good and all.

 

[lashicoN]

I truly feel bad for the Americans who were forced at gunpoint to pay into "Social Security" all their lives and they will receive nothing in return...except higher taxes. I'm young enough to not know how enraging that must be.

You can almost smell the gunpowder in the air already.

 

[hornadylnl]

You can almost smell the gunpowder in the air already.

You're right. If there's anything that will set the powder keg of the "R" off, it will be lost entitlements and not lost freedoms. What has happened to this country?

 

[mrjarrell]

You're right. If there's anything that will set the powder keg of the "R" off, it will be lost entitlements and not lost freedoms. What has happened to this country?

And therein lies a problem. There is going to be no loss of entitlements for anyone on SS/Medicare/Medicaid in the foreseeable future. They are already planning on raising taxes and withholding to cover any shortfalls or deficits. Both reps and dems will get behind this in order to save those crucial aged voters. They'd much rather see everyone enslaved than rid us of these anchors.

 

[Hammer]

It would be ok if we did not have so many dead beats drawing on the system that never payed into it.

 

[rockhopper46038]

According to my last statement I've "contributed" $203,000 to the Social Security and Medicare systems. I don't expect to see any of it in the future. Am I pissed off that I'm being fleeced? Hell yeah! If I had been allowed to keep that money in my own account I'd be damn close to retiring. Do I think the Feds will make a grab for 401(k)'s in order to "equitably distribute" my hard-earned money? I wouldn't put it past them.

 

[TRWXXA]

If there are still people out there planning on this for retirement...

Retirement? What's that?

I'm pretty sure I'm going to have to work until I'm dead.

Social security, and "pension funds" for that matter, are just giant pyramid schemes. If you got in early, you were fine. Anybody born after 1960 is almost certainly screwed.

My maternal grandfather never worked a day in the time I knew him. He had a huge pension from his company, bough a new car every 5 years, had a nice house in Florida, etc.. I'll bet nobody who currently works for his company is gonna experience that. They might have a 401K, but that's their own money that they've saved, not a pension. And I'm sure the commies running our country have already figured out they're gonna take that from them too.

 

[Bendrx]

I've said it before, and I still mean it. I'll gladly keep paying into this abomination without anything in return IF THEY WILL KILL IT! Let those who are already getting payouts keep getting thier (Umm..."my") payouts, but once they're gone no more SS for anyone, and no more taking money from folks for it at that time either. Though, for some reason the feds don't listen to me.

 

[Serial Crusher]

I'm preaching to the choir here, and this is a pretty long read, but still worth skimming. It was written a while ago as well, so I'm sure the numbers are much more appalling now.

Can the Second Amendment and Social Security Coexist?, By Aaron Zelman and Claire Wolfe

Another thing that comes to mind is FDIC, which has been hemorrhaging cash for some time now...

Hey, at least our social security numbers will never be used for identification purposes, right?

 

[popeye]

I'm one of those "bums" on Social Security. I took SS at 62 last year because I felt my job was in jeopardy. Sure enough I was laid off two months ago. I get $1500 a month and no 401K. I can (and do) get unemployment money from Illinois because I worked there. Illinois is one of two states left that takes SS benes into account so instead of $248 a week I get $66. I have no wife or dependents and rent is $700 a month. Next month I file banruptcy and hope for the best. Last year I made enough on my $10 an hour part time job that I owed SS $3500 back and had to pay income tax on 85% of my SS income. The problem is no jobs, and an arrogant moron president that's determined to turn the U.S. into a third world country. Obama was at the Chicago So. Side Ford plant last week patting himself on the back for the the additional 1200 jobs there. All the people in the plant were clapping and kissing his ass. He didn't mention pay for these new jobs is $14 an hr. All the while he was there I heard fighters over my house circling the Ford plant about 15 miles away. I wonder how many SS benes could have been funded by omitting this trip?

Was the Social Security Money “Borrowed” or “Stolen”?

by Allen W. Smith / July 9th, 2010
In December, the Obama deficit-reduction commission will make recommendations for budget cuts that will then be voted on, with an up or down vote, by the lame-duck Congress. Already, there is much speculation that Social Security will be one of the big targets. The rationale for cutting Social Security seems to be that, during such difficult economic times, everything should be a candidate for the chopping block, and that the public should support such cuts out of a sense of patriotism.
The flaw in this argument is that Social Security has not contributed a dime to the budget deficits or the soaring national debt. Social Security is funded exclusively by payroll taxes (also known as FICA taxes), paid into the fund by working Americans. In 1983, the payroll tax was increased substantially in response to the recommendations, the previous year, of the Greenspan Commission on Social Security Reform.
Prior to 1983, Social Security had operated on a “pay-as-you-go” basis with each generation responsible for paying for the benefits of the generation that preceded them. The 1983 legislation changed the nature of Social Security funding. In addition to paying for the benefits of the preceding generation, as was customary, the baby boomers were also required to pay additional taxes to partially pre-fund their own retirement. The net result is that the baby boomers have paid more into Social Security than any other generation. Yet they are often made scapegoats and blamed for the Social Security funding problem. I am not a baby boomer, but I am very sympathetic to them. They are getting a bum rap.
The intent of the 1983 legislation was to generate large Social Security surpluses for the next 30 years that were supposed to be saved and invested, in order to build up a large reserve in the trust fund that could later be drawn down to pay benefits to the baby boomers. The 1983 payroll tax hike has generated more than $2.5 trillion that is supposed to be in the trust fund. If the trust fund actually held this amount in real assets, full Social Security benefits could be paid until at least 2037 without any changes. Unfortunately, none of the surplus revenue was saved or invested in anything. It was all spent by the government on wars and other government programs without making any provisions for repaying the money.
Over the past 25 years, five presidents, and the members of Congress, have participated in the great Social Security scam. All Social Security contributions made by working Americans, except the amount which was needed to pay current retirement benefits, has been funneled into the general fund and used for non-Social Security purposes. Some like to say that the government just “borrowed” the money during the time period when it was not needed to pay benefits.
But borrowing implies repayment, and no provisions for repayment have been made. The government did not enact future tax increases that would automatically kick in when the Social Security money was needed. Neither did they enact legislation that would end other spending programs once the Social Security money was needed so the money could be transferred to the trust fund. The government spent the Social Security money, pure and simple, without making any provisions for future repayments. The IOUs in the trust fund are not marketable, and they could not be sold to anyone even for a penny on the dollar. The Social Security trustees confirmed the worthlessness of the IOUs in the 2009 Social Security Trustees Report with the following words:

Neither the redemption of trust fund bonds, nor interest paid on those bonds, provides any new net income to the Treasury, which must finance redemptions and interest payments through some combination of increased taxation, reductions in other government spending, or additional borrowing from the public.
​

In order for Social Security to pay full benefits after 2016, it will be necessary for the government to begin repaying the money it has spent on other things. This will mean increased taxes and/or additional borrowing. Neither of these is politically popular, and there is no assurance that future politicians will be willing to raise taxes to pay for the irresponsible behavior of past politicians. If the money is not repaid in full, with interest, it will have been stolen by the government from working Americans who paid into the fund.
Since Social Security would be fully funded until at least 2037 if the government had not used the money for other things, the only reason that politicians are advocating cuts in Social Security benefits is the fact that the government does not have the money with which to pay its debt to Social Security. Given the fact that Section 13301 of the Budget Enforcement Act of 1990 made it a violation of federal law to use Social Security revenue for non-Social Security purposes, it is hard to justify using the word “borrow” to refer to any of the Social Security money spent after 1990, even if it is eventually paid back.
Dr. Allen W. Smith is a Professor of Economics, Emeritus, at Eastern Illinois University. He is the author of seven books and has been researching and writing about Social Security financing for the past ten years. Read other articles by Allen, or visit Allen's website.

 

[SSGSAD]

I am going to grab my SS, at 62, also, I have Military Ret., coming at 60, if bho, doesn't louse that up.... just have to make it till then...

 

[popeye]

Well SSGSAD: Thank you for your 30. Remember that POS Clinton's attempt at screwing upcoming military pensioners? What a freak show the DEMOCRATIC/REPUBLICAN parties are. The biggest freaks are Indiana liberals.

I am going to grab my SS, at 62, also, I have Military Ret., coming at 60, if bho, doesn't louse that up.... just have to make it till then...

 

[DHolder]

The schmucks like that muffed up Wall St., and caused the big tumble last year, made sure I will be working the rest of my life! Twenty yrs of investments, I ended up with enough to pay off a couple of Dr. bills and the taxes on the early withdrawl. Good Job!!! Lesson learned, my children will manage their own money.

 

[popeye]

In 1935 when SS was enacted: There were, as now, no jobs. There were no pension or retirement plans. If you had a job you worked it till you died. So there were no positions opened until somebody died. The answer was SS. If you lived to 65 you could retire on the modest SS funds and live maybe another 5-10 yrs.. The system was never designed to maintain people to age 90. I don't know when SS started including "disabled". I limit trips to the SS office because it pisses me off looking at "disabled' who's only real problem is a lifetime of gigantic obesity which ruined their organs and limbs.

LINK > Life Expectancy for Social Security

 

[hornadylnl]

You are correct that Social Security was enacted during the Great Depression, with an peak rate of unemployment hovering around 25%. However, prior to that economic collapse, jobs were plentiful to the point of a shortage of labor in many regions of the country, with a fair number of pension and retirement plans in the private and public sectors. Though many retirement benefits did dry-up during the period from 1929 to 1942.

Life expectancy at birth in 1935 was 58 years of age for men, and 62 for women. However remember, that females did not greatly amass in the business workforce until 1942, and lasted to approximately 1946. Prior to such, women traditionally maintained the home.

Social Security was only intended as a supplement to one's lifetime of providing to their retirement, as only 2% of one's income was taxed for one's future SSI benefit. Survivor and disabled benefits existed from nearly the beginning, but were considered so unlikely to occur in such quantity, to affect the fund.

The true downfall of SSI occurred to government propaganda of the ability to live solely upon the entitlement, as well widening of benefits that were never intended from its inception. Such actions required an increase from 2%, to 6.5% of one's payroll, to maintain the SSI fund in 1977.

I know Rush has talked about the first SS recipient ever. She never paid a dime into it and signed up the day it was first available.

Also, correct me if I'm wrong, isn't the true cost of SS 13% on income? I pay 6.5% and so does my employer.

 

[thunderchicken]

I saw a t-shirt today that said. "instead of redistributing my money...try redistributing my work ethic". If only that could happen.

 

[trnsplntfrmohio]

I think every american needs to give up their social security number and stop paying federal taxes.

 

[trnsplntfrmohio]

All the people in the plant were clapping and kissing his ass. He didn't mention pay for these new jobs is $14 an hr. .

honestly, this is one thing that really ticks me. how much do you REALLY think someone should make working an assembly line that does not require a high school education?