quote:

Originally posted by parabellum:
Not gonna happen. I find it comical that anyone even considers it possible.

Yes. Alrighty then.

And I'm dead serious, too. At present, more than 25 percent of the US adult population draws SS benefits, and discounting the felons, those are all voters, from all aspects of political beliefs.

It's just not going to happen, because it cannot be allowed to happen. It would result in a political upheaval in this country, the likes of which has never been seen.

The 2028 election is likely to litigate the issue. The economy itself wouldn't survive the elimination of Social Security. Our politicians are fools, but they do have an instinct for self-preservation.

With all of the illegals being cut off through deportation and audits it should last until at least 2033.

Social Security benefits will not be cut because like Para said it would be utter chaos politically, they will just create the dollars needed and continue to devalue the dollar. Sort of like putting a frog in the water and letting the water get hotter and hotter. They will give out the COLA every year anywhere from 0-9% while the dollar loses 10-12% devaluation and inflation every year. Example $10,000 in 1971 only has the purchasing power of $1,400 in 2025.

I am old enough too that I have been hearing this run out of money for over 40 years. A wise man told me make sure your money is growing faster than inflation and devaluation and you will be fine.

It won’t run out and it gets old having heard the same BS all my life.

Now having said that a few months back Trump announced the availability of starting the new Trump Accounts for young ones. I wondered at the time if years down the road if the gov might start the option of paying into ones Trump Acct instead of paying into SS benefits. That would be one way of optioning out of the SS program.

I think that’s the plan get the Trump accounts to the size of “why do you need SS”.

I don’t see why it would be an upheaval any more than getting the rest of the mooches off the public tit.

Economics says it all ends, one way or another. Rome chose annihilation instead of reform, I suppose DC is on the same path.

quote:

Originally posted by parabellum:
And I'm dead serious, too. At present, more than 25 percent of the US adult population draws SS benefits, and discounting the felons, those are all voters, from all aspects of political beliefs.

It's just not going to happen, because it cannot be allowed to happen. It would result in a political upheaval in this country, the likes of which has never been seen.

As true as that is, there are many ways to further rig the system. My bet is inflation. SS is but one of numerous serious issues where the math is determinative. In fact, the Trump administration has stated in the last week or so that the national debt can be solved with growth, which is a euphemism for inflation. Actual growth with zero inflation cannot possibly solve the fiscal hole of SS, Medicare, or the national debt. We are past the point of no return for any realistic growth to suffice.

There's a reason the Fed's target inflation rate is 2% rather than zero. 2% inflates away past deficits over time. But Congress has ramped up spending, and thus deficits, far faster than 2%.

At some point there are literally no dollars available for the government to send out. Just like your and my family. Except the federal government can print more dollars out of thin air, while you and I can't.

But just like you and I, lenders charge higher interest rates when our credit worthiness goes bad.

Be prepared for very high interest rates and very high inflation, worse than the 1970's and 1980's. It is the only path other than outright default, absent Congress becoming responsible, which they won't because of exactly what you wrote.

quote:

Originally posted by chellim1:
Social Security Retirees Set to Collect 33% More Than They Paid In

New CRFB analysis finds Americans retiring this decade are scheduled to receive benefits equal to 133% of combined worker and employer payroll taxes, as the program heads toward a 2032 trust fund shortfall

That's because of inflation. The dollars I paid in were worth a lot more than the ones I'm receiving now so it naturally requires more of them to equal the same value.

If SS were a private retirement account it would be the worst investment choice ever.

I’ll take mine in a lump some please.

Forgive me for stating the obvious, but we're just going to have to wait and see.

I cannot help but be reminded of dire warnings at intervals over the years, of climate alarmists who say the oceans of Earth will flood coastal cities or we'll freeze or fry or whatever.

Interestingly, I've been hearing those warnings since the 1970s, the same as SS running dry. Granted, the Federal government mismanaging money over the decades is far more plausible than frogs raining from the sky, or forests bursting into flames, but, at this point, it's all in the same category AFAIC, of the boy who cried 'wolf'.

According to AOC, we only have 4 years left, so SS running dry by 2032 is moot. I’m going to party like never before.

quote:

Originally posted by Fly-Sig:

quote:

Originally posted by parabellum:
And I'm dead serious, too. At present, more than 25 percent of the US adult population draws SS benefits, and discounting the felons, those are all voters, from all aspects of political beliefs.

It's just not going to happen, because it cannot be allowed to happen. It would result in a political upheaval in this country, the likes of which has never been seen.

As true as that is, there are many ways to further rig the system. My bet is inflation. SS is but one of numerous serious issues where the math is determinative. In fact, the Trump administration has stated in the last week or so that the national debt can be solved with growth, which is a euphemism for inflation. Actual growth with zero inflation cannot possibly solve the fiscal hole of SS, Medicare, or the national debt. We are past the point of no return for any realistic growth to suffice.

Yes, inflation through additional borrowing is the preferred solution by many, if not by most. That, however, has it's own risks and may only compound the problem:
[all charts and graphs can be found at link]

The Cost of Borrowing Beyond 2032

Once the trust fund is exhausted (estimated to happen in the fourth quarter of 2032), current law no longer permits the program to pay scheduled benefits without sufficient incoming revenue.

At that point, Congress will face three options: allow automatic benefit cuts to take effect, adopt structural reforms that put Social Security on a fiscally sustainable path, or amend the law and maintain scheduled benefits through borrowing. Borrowing would avoid an immediate benefit reduction but would not eliminate Social Security’s financing gap. It would merely transfer that gap to the federal government’s already strained balance sheet.

Under a borrowing scenario, Social Security’s cash-flow shortfalls between 2026 and 2056 would total approximately $25.4 trillion. Financing those shortfalls would generate an additional $17.1 trillion in interest costs over the same period. On top of that, Social Security–related borrowing between 2010 and 2025 would continue generating interest costs after 2026, adding another $3.9 trillion by 2056. Altogether, the program would add roughly $46 trillion to federal debt between 2026 and 2056. That represents about 34 percent of projected federal debt growth over the period.

Figure 2 separates Social Security’s debt contribution into its underlying cash-flow shortfalls and the interest costs generated by financing them. This distinction matters: Borrowing does not merely postpone the financing problem. Rather, it causes the shortfall to compound as interest accumulates on both current and prior borrowing.

Table 1 summarizes Social Security’s projected debt contribution through trust fund exhaustion, and over 10- and 30-year projection windows.

Borrowing to maintain scheduled benefits would impose costs beyond the additional debt itself. The Congressional Budget Office found that gross domestic product (GDP) would be about 1 percent higher in 2036 than in its baseline projection if benefits were automatically reduced after trust fund exhaustion instead of being financed through additional borrowing. Lower government debt would reduce interest rates and support private investment, while lower benefits would lead some individuals to work or save more.

Borrowing on this scale could also increase the risk of a broader fiscal crisis if bond markets demanded higher yields, further accelerating the dangerous debt trajectory. In a negative feedback spiral, higher debt could also worsen Social Security’s finances by reducing investment, wages, and the payroll tax base—effects that are not incorporated into the trustees’ projections.

Congress Must Reform Social Security—Not Borrow Around It

Using general revenues to maintain scheduled benefits would not solve Social Security’s financing problem. It would shift the program’s shortfall onto the federal budget, increase interest costs, and expose workers and taxpayers to the economic risks of higher debt. Borrowing may postpone benefit reductions, but it won’t make Social Security sustainable.

Congress should act—before trust fund exhaustion—while it still has time to phase in structural reforms and give workers and retirees time to adjust. Waiting would leave fewer options, require more abrupt changes, and increase political pressure to finance the gap with additional borrowing.

The central obstacle is not a lack of policy options but Congress’s inability to assemble and enact a workable reform package. A commission of independent experts modeled on the Base Realignment and Closure (BRAC) process could help overcome political gridlock.

A BRAC-style commission would differ from past failed fiscal commissions in two important ways. One, it would consist of independent experts rather than elected representatives, insulating its recommendations from political pressures. And two, its recommendations would benefit from default adoption: Congress could reject the package, retaining final say, but not amend it. Importantly, a recent Cato Institute poll found that 71 percent of Americans support giving an independent commission such authority.

Social Security is not merely a future insolvency problem. It is already contributing to federal deficits and debt. Congress should act this year to reform the program—not borrow around it in 2032.

https://www.cato.org/blog/borr...6-trillion-debt-2056

This likely becomes a big issue in the 2028 presidential election. Congress doesn't appear inclined to do anything with the PROMISE act because both parties assume better majorities will be forthcoming. Hopefully we fix the program once and for all. An 'independent commission' in DC is one of the oldest charades in the book. Bizarre that Congress has apparently lost the desire or ability to legislate.

quote:

Originally posted by chellim1:
Yes, inflation through additional borrowing is the preferred solution by many, if not by most.

Oh, I don't have a solution. I'm just trusting in providence.
De Lawd shall provide.

I don’t think the fed gov will allow SS to run dry. They’ll fund it any way they can, even if it means ultra inflation. I also know that one day there will be a correction imposed and it won’t be pretty. The only way out of our economic woes is growth and discipline. Congress seems to be allergic to them though.

quote:

I don’t think the fed gov will allow SS to run dry.

I think that's what Para is saying...

But it depends on what you mean by run dry?
If by run dry you mean zip, zero, nada... then of course not. But that's not what we're talking about.

Once the trust fund is exhausted (estimated to happen in the fourth quarter of 2032), current law no longer permits the program to pay scheduled benefits without sufficient incoming revenue.

What that means is benefits would continue, but at a reduced rate of approximately 3/4 or 75% of what is scheduled.

Unless Congress acts... which I'm sure they will, in some way, by 2032.

Instead of acting on it in a responsible way, they'll just do some continuing resolution at the last minute so they can take full political advantage of the situation.

Ultimately, SS is not going away, nor is it likely to be reduced. I could see the full retirement age going up to 70 though.

quote:

Originally posted by chellim1:

quote:

I don’t think the fed gov will allow SS to run dry.

I think that's what Para is saying...

That's what I'm saying. The politicians and bureaucrats will do what they need to do to avoid the tar and feathers.

quote:

Originally posted by Gustofer:
Instead of acting on it in a responsible way, they'll just do some continuing resolution at the last minute so they can take full political advantage of the situation.

Yayyyy!!

quote:

Ultimately, SS is not going away, nor is it likely to be reduced. I could see the full retirement age going up to 70 though.

Yes, I can see that happening, and it may sound callous, but, taking all into consideration, it's the least offensive thing they could do. People are working longer, living longer.

we'll likely see a change in the way it's started, people born on certain dates will see 70 as the first year they can draw for example.

Second, you'll see higher SS taxes levied on payroll as a way to increase funding into the federal government.

As the boomers move through and out of SSI you'll see the demands on it reduced significantly over the long term, we've got probably 20 more years of the boomer population level to start falling out from death and reducing the applicants on SSI payments.

Part of the problem and the one that needs to be addressed is the exporting of jobs overseas. Its simple for companies to skirt payroll contributions, insurance costs, legal costs, HR, management and all the expenses associated with managing a payroll in the US to some third world company. My wifes company is now outsourcing certain task to overseas companies, for example what will cost them $70K here for a licensed qualified individual is $20K with zero benefits costs attached overseas.

The legal system and government rules on employment in the USA is forcing outsourced jobs by the millions, such as H1B.

JMO the feds should tax corporations for all outsourced jobs equal to the amount they would have paid into the system for every jobs lost, therefore they would have to pay the 15.6% payroll SSI, all medicare and medicaid into the system for each lost job, as well as payroll tax to the US on each job.

You don't have to make overseas outsourcing illegal, just raise the cost for doing it so that it's no longer that attractive.

Legal reform on civil employee costs as well as remove much of the burdensome expenses of HR compliance such as DEI as well.

JMO though....