[Pen-l] Re: Stock market rally expected today

["Julio Huato" <juliohuato@xxxxxxxxx>]

Robert wrote:

> No new revenues are needed to make sure "make sure Social Security
> sticks around for as long as the eye can see." CBO projects that
> Social Security will be able to pay all scheduled benefits through the
> year 2049 with no changes whatsoever. Even after 2049, with no change,
> the payable benefit would be 30% higher (in real terms) than today.
> Can your eye see past 2049? I'll be 84 - how old will you be? If I
> live to see the day there is an actual rather than projected shortfall
> (which keeps being pushed back - remember when it was 2030?) in Social
> Security, I'll count myself lucky.

I know, this is Krugman's argument as well.

With all due respect to accountants, arguing on the basis of
appropriated vs. mandatory vs. discretionary vs. whathaveyou is
accounting fiddling.  There's nothing, aside from political
constraints that can be removed with due political force, that says
that Social Security receipts (plus proceeds of existing balances) can
only be used to fund Social Security payments.  As other holes in the
budget get bigger, the temptation to use those funds to plug them only
grows.

It's telling that Social Security receipts and expenses are listed as
regular items in the federal budget.  Social Security can be easily
pushed into a serious crisis if other federal receipts fall and/or
other federal expenditures are starved.  And that's not the only way.
An inflationary spiral, not unlikely now that trillions are pledged to
shore up the financials, could contribute to "starve the beast" as
well.

Borrow (and push the rates up), drop the purchasing power of USD,
whatever.  Under no scenario is Social Security safe without resources
and political force behind it.
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