Austerity problem or something else?

Piezoe, you just don't know how to read the SS site...take this from the spin you pasted:

"How are the trust funds invested? By law, income to the trust funds must be invested, on a daily basis, in securities guaranteed as to both principal and interest by the Federal government. All securities held by the trust funds are "special issues" of the United States Treasury. Such securities are available only to the trust funds."

That is IOU, described in Orwellian speak.

How about this one; this one is great:

"If all the income is invested, how do benefits get paid each month? Money to cover expenditures (mainly benefit payments) from the trust funds comes from the redemption or sale of securities held by the trust funds. When "special-issue" securities are redeemed, interest is paid. In fact, the principal amount of special issues redeemed, plus the corresponding interest, is just enough to cover an expenditure."

This means they fund out of the general account and write down the IOU.

Then there is this cherry on top of the cow pie:

"Far from being "worthless IOUs," the investments held by the trust funds are backed by the full faith and credit of the U. S. Government. The government has always repaid Social Security, with interest. The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the Federal government."

They are saying that these are not worthless IOU's, they are the IOU's of the U.S. Gov't!; confirms they are as good as a U.S. Gov. promise; they are not Greek. When they go on to say that they are just a safe as Savings Bond they are misrepresenting. Bonds and other securities can be traded and enforced at law, Special issues cannot.

Piezoe, you can see through the smooth bull shit of this spin can't you? I did't think you came down with yesterday's rain water, but now I don't know. Hey Piezoe, don't worry, "The check is in the mail!", and don't bother to pick up the chocolate; I'll get it myself.
 
Quote from Ed Breen:

Bonds and other securities can be traded and enforced at law, Special issues cannot.
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Got anything to back that statement up, Ed? I'd be pleased to learn of it if you do, otherwise I'll just assume it is more drivel.
 
Piezoe, we went through this once before. In order for SS to sue the Treasury for performance on an IOU...you would first need a leagal security...which provides a legal remedy in the event of default; which you don't have. I know you refuse to understand that, so lets just assume that you think you can bring an action...The action would be The U.S. Government through Timothy Gietner as Trustee for SS vrs. The U.S. Government through Timothy Gietner as Secretary of the Treasury. Why don't you go ask a lawyer about statutory authority, contract law, secured transaction law, and basic common sense about suing your self. This is what it means to have a political promise instead of a security bond instrument; default on the political promise relies on a political remedy while the default on the security obligation lies on a legal remedy.
 
Quote from Ed Breen:

Piezoe, we went through this once before. In order for SS to sue the Treasury for performance on an IOU...you would first need a leagal security...which provides a legal remedy in the event of default; which you don't have. I know you refuse to understand that, so lets just assume that you think you can bring an action...The action would be The U.S. Government through Timothy Gietner as Trustee for SS vrs. The U.S. Government through Timothy Gietner as Secretary of the Treasury. Why don't you go ask a lawyer about statutory authority, contract law, secured transaction law, and basic common sense about suing your self. This is what it means to have a political promise instead of a security bond instrument; default on the political promise relies on a political remedy while the default on the security obligation lies on a legal remedy.
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Sue ??? Ed, come clean with me now, are you one of those guys with the camo and ammo?
 
Quote from Ed Breen:

No, I gave you free expert opinion as a licensed attorney, you moron.
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Even if it i twice as good as your other opinions, the price still seems too high.
 
Its funny, if you read the thread, back and forth, you will see, piezoe, that you agreed with all of my substantive points. It comes down to you thinking that a Gov't political IOU is as good as a Gov't. bond. We will see, it may turn out that way, but you also concede that the terms of the benefits payable in SS are likely to change...so you have a certain amount of self contradiction in you argument. The admissions and the self contradictions pretty much settle the argument. In the face of all that you make the argument about personal slights, tangents and citation, and you carry on as if the substantial point was not alread conceded...So judging the value of the items of discourse, in your case, I see that I have been 'thowing pearls before swine.'
 
We do agree Ed on more than it would at first seem, but you have never convinced me of one thing in particular, and that is that the securities held by the Trust are in any way inferior in their legal standing to any other debt obligation of the government. Where we have strong disagreement is that the securities held by the Trust are any more likely to be defaulted on than any other U.S. government security. We both agree that there are indirect, legal methods by which the assets of the Trust can be diluted in purchasing power. But again, I would argue that that is equally true of all other government issued securities, even TIPS.

I think where you are skating on the thinnest of ice, however, is your failure to recognize the difference between entitlement assets held in Trust and everyday government revenue, and the reasons why all of the entitlement programs, not just Social Security, have their assets set aside in trusts. And also, there is the matter of your failure to acknowledge the legislation that specifically prevents the assets in these trusts from being spent on anything other than the entitlement programs they back.

Furthermore, and about this I admit I could be quite wrong, it seems that tacit in all your arguments is a dismissing of the Social Security program's virtues, of which in my opinion the greatest is its shared risk feature. Thus those who die young subsidize with their contributions plus interest those who live an unusually long time. The practical importance of this feature is that much less must be contributed per month during ones working years to guarantee a subsistence retirement that can't be outlived. This is of tremendous value to the low wage worker who could never set aside enough in a private retirement plan, without such a shared risk feature, to be assured of the same pension that could not be outlived. Of course there is a trade off, but who would not be willing to trade security in their old age for a gamblers chance that they might die relatively young and leave a small estate to their heirs? And of course those of means have the best of both worlds, Social Security and private pension plans on top.

One more thing Ed, where were you when those idiots were saying Social Security is a Ponzi scheme? Your a smart guy and you know that's not true and that the entire Social Security program is based on demographics and statistics. So why not jump all other those bird brains that are spouting this nonsense rather than humor them?

Ed, there may be alternatives to Social Security that could work even better, but this is the system we've got. It's a good one, and we ought to get on with the needed small adjustments to the contribution rate. I'm sick and tired of Wall Street lies aimed at weakening Social Security.
 
if it's not a ponzi scheme (and I'm not saying it is) we could give everybody who is paying into it all their money back and there would still be enough money in the trust fund for all current retirees. Is that the case?
 
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