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Fat and Happy: Is Social Security Bankrupt?

February 17, 2009

E.J. Manning

congressional-storm-cloudsIt’s true. The 2008 federal budget deficit was $5.1 trillion, not the $455 billion previously reported by the Congressional Budget Office, according to the “2008 Financial Report of the United States Government” .  The American public is largely unaware that the actual deficit of the federal government has been measured in trillions of dollars for several decades. The total debt of $65.5 trillion in total obligations exceeds the gross domestic product of the world in a year.

It’s boring and at the same time horrific stuff as we listen to how much in greenbacks $1 trillion dollars really is. At the same time, the gross domestic product of the United States is $13 trillion or so, depending on whom you listen to. The real disparity lies between the amount of spending versus the amount of spending in the average American household. The disparity is a royal disconnect. If the nation had to pay off the debt without spending a dime in the process, simple math shows that it would take about 5 years to eradicate. In the meantime, there’s no question that national bailout is talking big numbers, with plenty of zeros, in the effort to rescue the U.S. economy. This last wave of profligate spending hasn’t been necessary to prove that Washington has a serious spending problem. So why should we care as long as we are fat and happy? We are fat and happy as a nation, aren’t we?

social-security-cardStrangely, social security, health care and elderly government programs are blamed for the preponderance of the national debt problem and government expenses while other government programs are conveniently ignored. Old people have become the abused society. Negative publicity figures are almost always announced in tandem with the aging population of America. Yet, approximately 40 million Americans are on the retirement dole, a mere 12.2 per cent estimate of the national population. These people have worked hard in earlier years and are in retirement for some duration until death, some not very long. A number of them are even prosperous, but no less deserving of a retirement check per the terms of the retirement system.

social-security-lockboxThe U.S. government is supposed to be holding funds for Social Security, which it hastily spends as if the money is burning a hole in the pocket of government finance. The cash obtained from your paycheck is hastily spent on government programs or whatever the government sees fit. The myth of the social security lock box is false. “There are no funds held in reserve today for Social Security and Medicare obligations that are earned each year. It’s only a matter of time until the public realizes that the government is truly bankrupt and no taxes are being held in reserve to pay in the future the Social Security and Medicare benefits taxpayers are earning today,” says John Williams of Shadowstats.com.

Your social security money is being spent on the disability, child programs and the current expenses of today’s retirees. Even worse, their retirement income figures are kept artificially low by using special calculation formulas and by using a low official inflation rate for the economy. The retirement community and the ideal of retirement has been used as an excuse for all the evils of government spending. Yet, their money was spent long ago by government largess in a ponzi scheme that rivals Bernard Madoff.

investment-ponzi-madoff1Meanwhile, 73.9 million American children or approximately 22 per cent of the population are due for complete coverage for government health insurance, even though many of them have been covered for years. 17% of children supposedly live in poverty. These are the children that government actually seeks to cover. Of all children, 67 per cent live with two married parents and approximately 33 per cent are on government programs of one kind or the other.

76 per cent of Americans are usually deemed to be working adults, but you can deduct 21.2 per cent of Americans that live on disability income. The national spending glut in Washington is being supported by approximately 56% of the American population. Of that 56%, about 800,000 monthly go into retirement. Government spending remains unabated as Washington ignores their profligate ways. Ultimately, the only recourse will be to monetize the debt by running the printing presses and posting all the debt to the government books. This what all the social security accountability fuss is all about.

floating-piggyIn the meantime, social security has been ransacked for all number of valuable pet projects while lawmakers continue to invent ways to spend more money that America can’t possibly support unless the Federal Reserve runs the printing presses. This action will substantially depress the dollar, creating a further economic spiral in a time of economic decline. That is why politicians are so nervous in our current and unusually deep economic downturn. They live in an economic black hole along with the American people and can’t possibly spend their way out. ~ E. Manning

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