SOURCE: FORBES
URL: https://www.forbes.com/sites/baldwin/201https://www.forbes.com/sites/baldwin/2017/07/13/news-from-the-social-security-ponzi-scheme/#4d7be1c735a17/07/13/news-from-the-social-security-ponzi-scheme/#4d7be1c735a1
by William Baldwin
The government is out today with its annual update of Social Security’s sick finances:
--The system is $12.5 trillion under water, up from $11.4 trillion a year ago.
--Absent law changes, checks to retirees will have to be chopped 23% beginning in 2035.
--To fix just the retirement pay program, Congress could kick up the payroll tax by 2.8 percentage points. Fixing Medicare’s disastrous finances would be in addition.
--The retirement operation is running an $86 billion annual deficit. That’s the difference between the money coming in from Social Security’s share of payroll taxes (12.4% of covered payroll) and the money going out in monthly checks and in overhead.
Ponzi? That’s too kind an interpretation. A Ponzi scheme has old investors being paid off with money raised from new ones. In this case there isn’t enough cash coming in from new players to pay off the old ones. The $86 billion shortfall is being covered in traditional federal fashion, by drawing on general tax revenues and by printing money.
The trustees of the Social Security system put the grim news in as positive light as they can. They cheerily note that “asset reserves” grew from $2,813 billion at the end of 2015 to $2,848 billion at the end of 2016.
But these “reserves” are not a pile of saved capital in the form of stocks, bonds and mortgages. Rather, they are a bookkeeping entry in which the government borrows money from the government, and the government pretends to have “income” by collecting interest from…the government.
(Excerpt) Read more at above link ...
Government does have income. It's called taxpayers' sweat, blood and the fruits of the hard work of American taxpayers, which never ever pays off for those taxpayers.... thanks to (you guessed it)... government.
And yeah, government collecting interest from government, or rather... from taxpayers, is or should be ILLEGAL.... even if it is just entries on a spreadsheet.
This whole bogus enterprise that government has created is going to come crashing down on all of us... probably sooner than later. And oddly enough, there's going to be one helluva lot of shocked citizens when it does. Even though many Americans have been warning and talking about that crash for years now.
