11 days until your SS checks might be interrupted

Why should I bother to make a sane argument to anyone on this forum or in real life “that ANY political side is doing a better job than the other?

Truth is: ALL politicians have it made and couldn’t care less about the taxpaying citizens of this country!!

It would be a completely different story if the taxpaying citizens would stand up to these corrupt politicians (who have ZERO worries, thanks to their LAW of “once elected, get paid for life”), and make them accountable instead of fight the obvious loosing battle of: “my sides better than yours”.

“Keep fighting each our folks, the corrupt politicians have you exactly where they want you!!”



United we stand, divided we fall, and we are…

 

That is true. However, it is naive to assume that things can be changed by voting for the right people or, as you say "holding them accountable". The truth is that the system changes the person holding office more than the person holding office changes the system. We usually start out with very well-intentioned people when they first run for office. However, after having run a few campaigns, they learn how the system works and become a creature of the system (i.e. financing the campaigns is the most important job). People who are true to themselves, who do not adapt to the system, are weeded out.

 

Yes, we need to figure out how it is that the wealthy people have lobbied government that rather than paying taxes, they lend government money and charge interest for the privilege. That's the end result of GOP tax cuts for the rich. Not that the Dems are innocent.

What we need is no more tax cuts and no more future new spending. Let's say we cap spending to a rate of 1% increase per year (no programs excluded, even SS). If the average growth rate of the economy is 2-3%, we'll slowly get back to more sane spending relative to GDP. Of course, this would mean that seniors would take a haircut, too. My guess: They'll complain, loudly, and, so, nothing will be done.

 

Yes, real investing isn't the government collecting FICA taxes and leaving a marker (government bonds) in a phony trust fund.

Because we're destroying the middle class and throwing millions more into poverty.

I want to adjust the playing field for everyone, including myself.

I wanted "change things" before I amassed wealth.

You must spend your day virtue signaling.

 

Au contraire. I read your post where you claimed you're "schooling me."

 

@Quantum Nerd asked you what you would cut, not which side is doing a "better job."

That's fine. Now, what would you cut?

 

The stock market is the only real investment? LOL. Government bonds aren’t real investments? Directly loaning to an entity isn’t real investing? Annuities aren’t real investments? Just stocks! I don’t know where you come up with this stuff. All are REAL investments. They just fill different needs of different investors and those needing funding.

Don’t include me in your “we”. I’m not the one intentionally transferring compensation you say is due workers to capital instead. You are the one who amassed wealth by taking the compensation making up the productivity pay gap and putting it in your pocket while endlessly bemoaning the gap you created.

But not badly enough to have taken personal action to level the playing field.

You wanted the wealth more than change.

No. I spend my days and many nights producing. Actually WORKING to create products for consumers. Not trying to figure out how to line my pockets at other worker’s expense.

 

Sandy Shanks said:
Congress has increased or suspended the debt limit unconditionally 78 times since 1960 under both Republican and Democratic administrations, three times under Trump. Without experiencing a war or a recession. Republicans thus allowed the Republican administration of Donald Trump to add $7.8 trillion to the National Debt.
*******************************************************************************************************************************************************

Caution: It is not over yet. Raising the debt ceiling must be approved by the House and the Senate.

The Republicans backed down on most of their demands, and the House bill to raise the debt ceiling, but gutted the Biden administration was forgotten. This is not a surprise. They were wrong to hold the American economy and the American people hostage for demands they could not obtain through ordinary means.

The Guardian reports, "Joe Biden and Kevin McCarthy have reached an agreement to lift the US debt ceiling and avoid a disastrous and unprecedented default. Prior to the details being presented to lawmakers, ahead of an expected vote on Wednesday, here is what sources familiar with negotiations have revealed:
Cap on discretionary spending
The deal would suspend the $31.4tn debt ceiling until January 2025, allowing the government to pay its bills. In exchange, non-defense discretionary spending would be “roughly flat” at current year levels in 2024. It would increase by only 1% in 2025.
What about the 2024 presidential election?
The debt limit extension schedule means Congress would not need to address the deeply polarizing issue again until after the November 2024 election. Note: In other words, a two-year deal.
Increased defense spending
The deal is expected to boost defense spending to around $885bn, in line with Biden’s 2024 budget spending proposal, an 11% increase from the $800bn allocated in the current budget.
Special IRS funding for federal tax authorities
Biden and Democrats secured $80bn in new funding for a decade to help the Internal Revenue Service enforce the tax code for wealthy Americans in last year’s Inflation Reduction Act.
Covid clawback, cuts for the CDC
Biden and McCarthy are expected to agree to claw back unused Covid-19 relief funds as part of the budget deal.
Work requirements
Biden and McCarthy battled fiercely over imposing stricter work requirements on low-income Americans who benefit from federal food and healthcare programs. No changes were made to Medicaid health insurance in the deal, but the agreement would impose new work requirements on low-income people who receive food assistance, up to age 54, instead of 50.

 

Just consider it part of your continuing education. Real teachers should always be learning themselves. It won’t hurt you to learn. From this thread I’ve learned that some people think purchasing government bonds is stealing. I wasn’t aware that was a common belief.

 

I don't think you're interested in a discussion given you're personalizing the issues.

 

Your posts are based on a lot of misinformation.

 

Your investing, teaching, coaching, union involvement etc. are subjects YOU have talked about on PF, an open forum. In the future, if you wish those subjects to be off limits, I would suggest not bringing them up yourself. That’s kind of how things work on an open forum.

I’m always open to EVIDENCE my posts are incorrect of course. Or evidence claims you’ve made like investments must be contractual at the government level to be defined as investments. Or that purchase of government bonds is not investing. Or that annuities are not investments.

 

Revealing isn't it

 

Of course that is also your unsubstantiated opinion. Just like your claim lending isn’t investing is your unsubstantiated opinion. After claiming SS is a loan we make to the government.

I’m always amused when someone claims misinformation is afoot but can’t provide any evidence the information is incorrect. You are welcome to provide evidence I’m incorrect. Something more than your so far incorrect opinion…

 

Awesome Reply! I saw you had posted in this topic and was interested in your take. Here is Kevin McCarthy's.

McCarthy: This deal is the first step toward fiscal sanity

He leads of with "we're awesome, but Joe sucks" and then gets to:

'Perhaps the most historic and foundational change is cutting spending year over year for the first time in more than a decade. Taking aside veterans’ healthcare, which will be fully funded, we will return to 2022 spending levels for nondefense accounts.'

Now, is that really much of an accomplishment? 2022 spending was 26.5% higher than 2019 spending (last non COVID year)

And 2019 was 16% higher than 2016.

'set top-line spending at 1% growth for the next six years.'

That's a little better. Spending is nearly always growing faster than that.



How will they enforce it? Especially with such a large increase in the Debt cap? What if next year, Biden says "I changed my mind" or more likely "The needs of the nation have changed"? Then McCarthy and the GOP look as dumb as Joe Manchin?

'we will spend less money next year than we did this year—stopping inflationary spending while fully funding national defense, meeting our obligations to veterans, and preserving and protecting Social Security and Medicare.'

But, it seems like we're accepting COVID spending levels as the baseline.



Closer to 24% of GDP than the 22% range before COVID.

https://archive.is/yJxaw

'With new paygo rules in place, we will hold Mr. Biden accountable, rein in executive overreach and save taxpayers trillions.'

I don't understand how paygo will be enforced.

'We add new work requirements for adults without dependents who receive money from SNAP and TANF welfare programs.' Able bodied adults.

'streamline permitting and will let us build more infrastructure, produce more energy in America'

'Only because of Republicans’ resolve did we achieve this transformative change to how Washington operates. We are 141 days into this Republican majority, and we’re only getting started.'

Thoughts?

 

It is. And fascinating.

 

I have no doubt if one borrows or lends money, they are investing, but my argument is that investing is not limited to lending money either. For instance, parents invest in their childen not by lending money, but by spending money. Thus whether one spends money to invest or lends money to invest, it is basically the same thing. However, Social Security is not an investment per se. Your current SS and Medicare taxes pay for today's retirees and their benefits, even if you are 65 and over, still working, and earning income that is required to pay into the SS and Medicare taxes. The forumula used for your benefits when you retire is based on what you pay even though that money is being used for the current retiree payment structure. It has been argued to change social security into a more traditional investment similar to what the UK, Mexico, and even Singapore does, but that is a political decision, not a financial one.

We did it when we changed from CERS to FERS. Prior to 1986, federal employees were not contributing to SS. When FERS came into existance, the federal employees now do, along with the pension plan and TSP accounts if they so choose. With about 92% of the workforce paying into SS and Medicare, even some illegal aliens I might add, the payments are coming in, but our main problem is we are living longer than expected when this program was originally set up.

In the beginning no it did not because people did not live much longer than past 65. The whole idea, originally, was to make sure elderly people can retire and have a guaranteed income of some sort instead of relying on their children for support. It was practically solvent until about the 1980s when the Baby Boomers began to retire at a much faster rate and we did not have the workers to replace them at that rate. And that is why we have played with the formula, the requirements for who can get SS and Medicare, the age in which SS and Medicare can be received, age of retirement, and even the elimination of certain donut holes such as the Teacher donut hole for instance. And we have been doing this since the 1980s even when Senator Edward Kennedy began talking about the "privatization" of SS. I do think we need to expand what the SS trust fund can invest, which is current T Bills and T bonds only, but that has to be an act of Congress though. And given the divisiveness of our politics, no reasonable solution is any in the foreseeable future IMO. I don't like the GOP plan for privatization because that will be more expensive in the long run, but I do like using the SS Trust Funds to use TPS to invest into the market using Lifecycle funds to increase the growth rate to delay the insolvency further until a more permanent solution is decided. And we need to do this in order not to lose or reduce benefits to current retirees and future retirees. And that is the trick.

That may be true, but they will always end up being illegal in order to maintain that growth rate that the ponzi scheme author perpetuates. that is what happened to FTX, among others.

There was no laws in those days when Charles Ponzi. He basically sold annuities with high rates of return. But he used the current premiums to pay for the outlays when someone decided to cash out the annuity or insurance policy. He was unscrupulous to whoever invested from newspaper boys to well-to-do individuals who placed $10k in 1920 dollars into the scheme. But he was always paying back investors from new investors and eventually, he saturated the market where he could no longer keep up with the payments. Eventually, he was charged with mail fraud and pled guilty, served time, and was deported back to Italy, broke. But his scheme led to the laws that we now have in which Ponzi schemes are practically illegal.

Social Security, per the link you gave, only meets a few of the criteria, not all of them. For a Ponzi scheme to be identified, all the criteria have to be met per the SEC. For instance, a guarantee rate of high returns with little or no risk. SS does not make any promises. Yes, it pays today retirees with your tax, but SS is not an investment by definition. It is a social insurance policy in which if you meet certain requirements, you may, under the law, obtain a benefit from the government based on the amount of taxes you pay. In other words, SS does not meet 18 USC 1341.

Need to look at the United States Code that I listed. If it meets that definition under the code, then it is a ponzi scheme. If not, it is not a Ponzi scheme.

 

Apparently, you swallowed his absurd misrepresentation of my position.

 

Your correspondent is trying to convince us Social Security is a Ponzi scheme. It isn't even an investment. It is, in fact, a tax with annuity benefits set by the government and not guaranteed.

 

You and economics don't walk the same path.

 

Wow. That’s a lot of information! Clearly you’ve put some thought into this and not just accepted partisan talking points. As someone with very little interest in the day to day partisan politics of the US anymore I’ll do my best to comment on a “deal”.

I can only hope fiscal sanity is the goal. They will have to prove it to me with more than this compromise and these platitudes.

I’m always disturbed when a politician claims they are cutting spending and in the same breath say they are limiting growth in spending to 1% annually. Slowing the rate of growth isn’t cutting spending. I’m not sure why they make such claims.

I agree with you the caps imposed by this deal aren’t impressive. Real cuts would never have been agreed to. As an aside I think it’s funny it’s now the Dems who support the military industrial complex at least as fervently as the GOP, maybe more so.

Yeh, six years is a long time. And look at all the other times we’ve gone through this. And every time spending increases and increases at a faster rate sometime soon after these “deals”.

I honestly have no idea what the enforcement mechanisms are. Perhaps someone else does. I’m with you, I don’t think it really matters as the “cuts” are minuscule anyway. As far as looking stupid I think both sides do a pretty good job on that score. The fact this debt ceiling debate is a regular occurrence doesn’t reflect well on our government in general.

I’m a bit confused as to how defense spending isn’t inflationary. Makes a good sound bite I guess.

Mr. Biden is no longer with us but again I guess it sounds good. And diplomatic.

I’ll be looking forward to the tax savings!

I haven’t looked at the actual work requirements but that seems like a no-brainer. We should never shell out benefits to people who could do for themselves.

I’m confused again how we would build more infrastructure if we are going to spend less. There just isn’t any logic to some of this rhetoric.

If Republicans want to show resolve in fiscal conservatism I’m pleased. But I’m not going to take their word for it. I shed my last vestiges of respect for Republican resolve when they repeatedly voted to overturn the ACA when they didn’t have the Senate votes but never voted again when they had the Senate.

Bottom line I don’t see this can kicking as turning out any different than past can kickings.

At this point in my life I’m spending a lot of time and energy hedging against the potential consequences of government’s inability to be fiscally responsible and not very much time and energy worrying about or trying to affect things I can’t change. I have zero influence on the debt ceiling, spending, or revenue collection schemes. I have almost unlimited control and influence on how I prepare for the effects those things have on me. The last thing I want is to be on my knees begging these clowns to help me when their actions create an economic crisis. You don’t expect the people who screwed up a system to fix that system no matter if it’s a go-cart or a nationally economy. And you certainly don’t want to be at their mercy if/when things go south.

 

Republicans are pissed that with 60/40 support in the polls that McCarthy is going with a plan that locks in the covid elevated baseline and gives nearly triple the debt cap lift of the GOP plan. My thoughts are:

1. McCarthy isn't serious about cutting spending, or
2. He thinks that the 60/40 support in the polls will promptly reverse as credit downgrades, late SSI checks, and the stock market dives and the steady daily drumbeat in the news is that the GOP are destroying the country; that is, he's not convinced that We The People are really committed to curbing spending.

 

Of course investing isn’t limited to lending money. Nobody has claimed so. And yes, current contributors are paying for past contributors. That’s the key point—just like a classic Ponzi scheme.

Life expectancy is part of the problem. Fertility rates are just as important. Labor force participation rates have been falling over the last couple decades as well. The point remains, SS was intended to have future beneficiaries pay for current beneficiaries. It had to because initial retirees like Ida Fuller had only paid into SS for less than three years when starting benefits.

Not only has the tax rate to fund SS risen 600% since 1935, the tax cap has increased drastically as well. The idea longevity is the only issue at play is laughable.

It remained “solvent” because the minimum investment increased 600% and the tax cap increased as well. It’s a third rail to raise SS tax at this point. It’s already 12.4%. We are out of options. Our population replacement rate is negative. We are living longer. We’ve maxed out the tax rate. Anyone with any sense knew this was unsustainable. For the record I’m not against broadening where revenue is invested (even though ya’ll say SS isn’t an investment).

Yes, because private sector Ponzi perpetrators can’t “print money”. Therein lies the ONLY meaningful difference between SS and private sector Ponzis. Well, that and the fact the government compels you to invest in SS if you are a producer.

LOL. No laws in the days of Charles Ponzi? He sold annuities now instead of insurance? No. He practiced ARBITRAGE using international return coupons until their use was suspended. Where do you guys come up with this stuff?

Yes, practically illegal, unless run by the state. Just like slavery is practically illegal unless practiced by the state.

No, it meets all vital requirements per the SEC. The stock market makes no promises. Are you saying because the market doesn’t make promises of return of capital and/or gains stocks aren’t investments? Again, where do these silly notions come from? And insurance is an investment. Life insurance is an investment. Health insurance is an investment.


Here is the SEC definition again.

If an entity takes your property and assures you it will be returned to you, but isn’t bound to do so and can do as it pleases with that property, and has, that is definitely fraud.

Seems to be a ringer. You’ve claimed SS is property taken and justified by a promise made but not bound to be kept. That fits your linked definition to a “T”.

 

Evidence my friend. Show us the evidence! Your unsubstantiated opinions have little value.

 

Any suggestions to fix these issues?