The bureaucrats at Social Security will not admit it. Congress will not admit it. Obama and Romney will not admit it. Social Security is broke.
How do I define “broke”? When you have no assets to pay your bills and you must borrow money to pay old bills, you;re broke.
The Social Security system in 2010 started cashing in its IOUs that it had been given for 70 years to the Treasury. The Congress had spent all of the money. Finally, the money coming in from FICA taxes was less than the money being paid out.
Congress had no money to pay to the Social Security Administration for the cashed-in bonds. So, Congress borrowed the money.
Unless FICA taxes are hiked or payments cut, SSA will continue to cash in its IOUs. It’s broke. Congress must bail it out.
The Ponzi scheme has hit a brick wall.
The media are slowly beginning to write stories on this.
First, there are benefits.
People retiring today are part of the first generation of workers who have paid more in Social Security taxes during their careers than they will receive in benefits after they retire. It’s a historic shift that will only get worse for future retirees, according to an analysis by The Associated Press.
Previous generations got a much better bargain, mainly because payroll taxes were very low when Social Security was enacted in the 1930s and remained so for decades.
“For the early generations, it was an incredibly good deal,” said Andrew Biggs, a former deputy Social Security commissioner who is now a scholar at the American Enterprise Institute. “The government gave you free money and getting free money is popular.”
As with any Ponzi scheme, it’s great if you got in early. Today’s workers now get to pay the early entrants.
They won’t keep doing this. They have more votes than oldsters. At some point, they will elect a Congress that pulls the plug on granny.
If you retired in 1960, you could expect to get back seven times more in benefits than you paid in Social Security taxes, and more if you were a low-income worker, as long you made it to age 78 for men and 81 for women.
This deal has ended.
A married couple retiring last year after both spouses earned average lifetime wages paid about $598,000 in Social Security taxes during their careers. They can expect to collect about $556,000 in benefits, if the man lives to 82 and the woman lives to 85, according to a 2011 study by the Urban Institute, a Washington think tank.
Here come the baby boomers!
Then there is the Great Lie: that there is a Social Security Trust Fund. There isn’t. There is a pile of IOUs from Congress. Congress must now borrow money to pay the SSA, which is cashing in these IOUs. But the lie goes on. The Trustees continue to deceive the rubes.
The trustees who oversee Social Security say its funds, which have been built up over the past 30 years with surplus payroll taxes, will run dry in 2033 unless Congress acts. At that point, payroll taxes would provide enough revenue each year to pay about 75 percent of benefits.
Result:
“Future generations are going to do worse because either they are going to get fewer benefits or they are going to pay higher taxes,” said Eugene Steuerle, a former Treasury official who has studied the issue as a fellow at the Urban Institute.
Sorry, granny. The gravy train is ending.
Today, 56 million people receive checks. It will go to 90 million in 2035. This assumes no unexpected increase in life expectancy. This figure can be reduced through assisted suicide. You know: put granny on the floating ice and wave goodbye. This is the Kevorkian solution.
Social Security provides most older Americans a majority of their income. About one-quarter of married couples and just under half of single retirees rely on Social Security for 90 percent or more of their income, according to the Social Security Administration.
The system will be modified. Either more money must come in or less money must flow out.
The question will be decided by Congress. Who has the most votes on election day?
It would be solvent if Johnson and Congress had not changed it over to the general fund. They had no business doing that, it belonged to the ones paying into it, not the government to use any way they wanted.
The answer is clear. We need to start living within a budget. Federal government must be cut. There are hundreds of organizations that are either useless or doing duplicate functions. How's the department of energy doing saving us costs – they need to go NOW! Uge staffs, many czars, Obamacare, large congressional salaries and benefits – it's all caught up with us. We will never see social security paid back. Illegal immigration must stop and all illegals sent back like they did under Roosevelt, Truman and Eisenhower. The costs to keep illegals in this country is killing us. Let's follow the laws we have. We can always reform later. We have returning service men and women – what will they come home to? IRS reform is a must – but until we reform it – we must pay taxes. We need leadership from the top down and it just not there. November can't come soon enough!
If they would put back all of the money they have stolen from it over the years, it may be solvent again.
I know I will catch FLAK for this but here goes.
My parents are 92 and without question members of the WWII Generation. They are called the World's Greatest Generation. I have called them the most selfish generation that stole from their children, children's children, etc
My step father paid only $600 for they YEAR in 1968 for Social Tax as a self employed Veterinarian. Now he collects a $2,000 a MONTH check. He refuses to understand it comes from 5 Baby Boomers (his children) paying an average of $400 a month in Social Security Taxes.
The entire WWII Generation let the Democratic Controlled Congress KILL the Trust Fund for Social Security in 1964 so the Dem's could finance all their work paradise social programs. In 1964 NOT ONE single Baby Boomer was of voting age.
Now we Baby Boomers are entering retirement age only to find out that the Gov't has screwed us and given all the money away to the WWII Generation that received FAR more than they paid into it. The next time I hear that Baby Boomers are selfish I will point to what was done in 1964 and how WWII generation folks have robbed the generations behind them. They took the money they felt they were "owed" with out realizing it was coming out of their children's pockets in the greatest PONZE scheme in history.
There is more but why continue.
I know this may sound trite but this is exactly what the Governor of North Carolina did years ago. He put all of the Wildlife fees, fines, licenses, everything relative to money involving the Wildlife Department in the General Fund and from that point on North Carolina Wildlife and it's programs wen to hell in a hand basket. In other words we only have a Wildlife Commission in name only. That's exactly what has happened to Social Security. Because of putting Social Security in the General Fund it will ensure that it will follow the same spiral downward as North Carolina's Wlidlife Fund. We boomers may never see a dime of what we have paid in. But the politicians still get their retirement checks !!!!!!!!!
No problem! Just have the Fed print up more "money" and loan it to the government! Trees really do grow to the sky!
My parents were part of the WWII generation. They saw what was coming years ago. They actually called the SS administration in Washington when they turned 65 and asked if they could waive payments because they realized by then that it was a gigantic Ponzi scheme. They were told, "No, you have to take the checks".
Also, don't forget it was Bill Clinton who spent the Social Security trust fund surpluses that had been built up for your and my retirement when he and the Gingrich-led Congress proudly trumpeted that they had "balance the budget" in the late nineties. So the Boomer generation screwed itself.
Author's own words: "How do I define “broke”? When you have no assets to pay your bills and you must borrow money to pay old bills, you;re broke."
The Federal Government (Congress) had to borrow $1.5 TRILLION to meet it's budget. B O R R O W $1.5 TRILLION!
And most of that money was given away to foreign governments and entities!!! Insane? YES!
BROKE?? absolutely!!
The govt. should never have been involved in the insurance business…of any type…can you say enumerated powers? FDR imposed the FICA tax and SS program at the same time to fool the public into thinking that they were contributing to a retirement fund. SCOTUS declared in approx. 1957 that it was only a tax…and the govt has been using it as such, for any purpose, since. Here's the deal…we need to find an equitable way to end it (and all other federal overreach such as Medicare, Medicaid, Obamacare etc.) Consideration for those who foolishly trusted the govt. is needed, but the young need similar consideration for their future. Most beneficiaries could have afforded private policies if they desired if their paychecks were not plundered by the govt. The truly indigent should have charity and possibly a true govt. safety net (not a hammock). And no such welfare recipient should be allowed to vote!
Social Security is NOT broke. Our government borrowed [I called it stole] billions of dollars to spend on other ideas such as earmarks and other failures. Then they had the audacity to tell us, WE THE PEOPLE, we were running out of money. IF congress were to have to retire on Social Security as the rest of us have to do. I am willing to bet money would flow back into the system faster than you could spit.
Back in the 1960's Social Security had a surplus which our congress [there is that word again] borrowed and failed to re-pay
to the system. Fo all the money taken out not one cent had been replaced.
Don't worry young ones, Obamacares Death Panels will get rid of all us oldsters & SS will be saved!!!
You know, you might have something there,Freedom…there might be a connection between Obama's and Congress' rush to pass Obamacare and the ss crisis. Of course, that would be a paranoid conspiracy theory. Never mind.
No, it's not paranoid, David. I took early retirement last year, because of health problems, & am drawing $830 a month, after working 46 years of my life, paying SS tax, plus then the Medicare tax when it was started. And, Obama is DEFINITELY for getting rid of elderly, disabled, or anybody else that will 'use up' benefits from younger, more desirable people, (like illegals). Plus, I heard him myself say, when he was trying to sell Obamacare to Congress that if you're elderly, & need expensive medical care to prolong your life, you needed to consider the alternative. In other words, just gie already. But, I don't blame Obama entirely. Our House & Senate apparently have no problems with it either, because not many of them seem too interested in stopping Obamacare. If they refuse the funding for it, it would die, but Boehner refuses to pass that. He let them pass the bill to repeal it, but won't stop the funding for it? He is a total RINO.
You need to check more than one year on your grandfather,checks are based on lifetime income and a 2000.00 check is based on above average income.This is the first time in history when a person with average income who lives to be 82 will receive less in benefits than he paid in. If you want to solve SS problems return to the system of trust funds and remove non-citizens from benefits. Drug addicts should not receive disability benefits,drugs are a choice not a disability. Some parents encourage their children to misbehave in school so they can be classified disabled and receive check,this needs to stop.Food stamp program needs to be changed to a temporary thing and not available to non-citizens.We need to stop giving away billions to every country in the world and drop out of UN which gives power to sanction US to countries like Iran.We can't have a cross at a Marine memorial because it is religious but we can spend millions building and remodeling mosques.I have a long list of other cuts that can be made without taking away seniors retirement benefits but this gives you an idea of the waste we can cut. One more thing,the 2000.00 check you mentioned is not what everyone gets. I can show you plenty of people receiving 500..00 to 1000.00 per month, lets see you survive on 500