"We ain't gonna pay 'em!"

[grytpype]

"See these here pieces of paper? The ones that say "full faith and credit on 'em?" Well, we ain't gonna pay 'em. We just ain't gonna do it."

[AlCzervik]

1. "See this nice lady here is what i call my reader"

[MichiganVote]

2. Where the hell is the shredder in this place anyway?

[grytpype]

3. This is the biggest goddamned scandal ever.

Really. I mean Jesus, this dwarfs Enron.

1. Taxpayers paid billions of dollars in extra taxes to build up a trust fund.

2. The taxpayers' fund money is loaned to the rest of the government, in exchange for Treasury securities (i.e., the fund purchases Treasury securities). Presumably this was because Treasury securities are the SAFEST INVESTMENTS THERE ARE, because they are backed by the full faith and credit of the government's PROMISE TO REPAY the money loaned by the fund, with interest. Period.

3. In 2005, the President of the United States says the securities are worthless and will not be honored. They just won't be.

He says the money "is gone." Of course, the money borrowed by the goverment was spent, but the bonds are still in the Fund and constitute claims on the Treasury -- a legally enforceable promise to repay. The bonds are still there, as Bush saw with his own eyes.

Jesus H. Christ on a Rubber Crutch. How can he get away with this?

Interesting questions come to mind:

1. What recourse does the bondowner (i.e. the Trust Fund have if the government defaults? Is there some entity or agency that could sue the Treasury for performance on the bonds?

2. What happens when the first Trust Fund bond is presented for payment?

[AWorkerBee]

4. Makes me wonder

How the foriegn countries such as china, japan, and britian will feel if we reneg on our bonds.

Might make them cash out a little quicker than would be prudent.

Can you say "soot ourselves in the foot?"

[Jesus Saves]

5. Could you explain this to me?

Or point me to a link that goes in to greater detail on this subject?

[BeFree]

7. Here's the scoop

All the billions of dollars paid into SS over the years are represented by paper IOUs stored in one drawer of a file cabinet somewhere in Philadelphia.

There are no SS dollars set aside, invested or banked... the sum of money paid into SS is nothing but the aforementioned paper IOUs issued from one hand of the government to another.

Heard Rove say there is no way the government can cover those IOUs; and he was talking for the whole of government.

[dweller]

8. when was that said?

i knew that was coming, but missed it i guess.

a link to the Rove story please, been off-line for the day.

tia
dp

[BeFree]

12. Rove link

No can do. Saw it on a tv in a chicken lickin' place.. on faux. Two weeks ago?

Saw the SS file cabinet on tv last year some time.

Now, I don't believe everything on tv, but what I saw was the truth.

[grytpype]

9. No, the dollars ARE invested.

They are invested in Treasury securities, the safest things around.

Bush wants you to think that is not an "investment," don't fall for that please!

[BeFree]

14. No, they are not invested,

They are mere IOUs. Why do you think it's going broke?

SS works with the dollar you paid last week going to the oldtimer the next week. The rest, or extra, goes into the general fund and is said to be spendable on any and everything.

Now, given that the federal deficit is in the process of digging it's way to China, how much moola do you think is going from your paycheck into the bank?

If the SS funds had not been already spent, there would be no deficit.

Just for kicks.... show me proof they are invested.

[grytpype]

17. Read the articles I link to in another comment.

and read this: http://www.ssa.gov/OACT/TR/TR04/III_cyoper.html#wp84171

If you still don't get it, I can't help you.

[BeFree]

21. I got it

The only investments are loans back to the government. It's like loaning yourself money, when you go broke, there is no paying back, eh?

But you were right, it is not just inserted into the general fund, although it is. Know what I mean?

Still, the crux of all this is that as the SS trust fund wants to be paid back, it looks like the other hand is deciding - here and today - that the funds won't get the money back because ....

on edit:
from: http://www.ssa.gov/OACT/TR/TR04/VI_cyoper_history.html#wp90303
"All contributions are collected by the Internal Revenue Service and deposited in the General Fund of the Treasury. The contributions are immediately and automatically appropriated to the trust funds on an estimated basis.
"

[davekriss]

34. BeFree

They are invested, the entirety of the $1.7 trillion already collected from our paychecks, in special issue U.S. Treasury Bonds paying 2.5% interest.

George Bush is saying that he will (1) make the tax cuts permanent that overwhelmingly benefitted the top 2% of our nation and will cost $2 trillion between just 2001 through 2010, (2) lie us into illegal wars that cost us around $80 billion per year to fight, never mind the spilled blood, and (3) default on the Treasury Bonds invested in by me and you since 1983, when Ronald Reagan signed legislation that increased the regressive FICA tax at the recommendation of the 1981 Greenspan Commission.

There is a crisis, but it is a general budgetary crisis. Bush is choosing to resolve the crisis on the backs of working Americans in order to preserve his tax cuts for the wealthy, ensure that the owning class gets to pass on 100% of their multi-million dollar estates to junior, and so that he can continue to engage in military adventures around the world. It's a matter of priorities. No American should side with George W Bush, who appears to be a traitor to our nation and our constitution.

Recall that Mean Green claimed that, by raising the FICA tax, social security was "saved" for the indefinite future. And indeed it was. The projections of crisis are based on very conservative estimates of growth (1.8% GDP growth when these last 100 years we averaged over 3%). Note that the first year where SS is supposed to go broke keeps receding over the horizon -- just five years ago it was thought to be 2029, now it is 2042, all because over these five years the economy grew faster than the intentionally safe and conservative assumption of 1.8% GDP growth.

The 2042 date itself is based on the mere 1.8% growth figure from 2005 through 2042; again, actual GDP growth is likely to be higher. But assume that growth does slow to this cautiously low rate. If nothing is done, what happens? Benefits can still be paid at over 80% of current levels. Where's the fire? It is again in the general budget and Bush seeks to divert accountability from his reckless policies onto a remnant of new deal liberalism that benefits the many of us.

What a shame we allowed Bush to steal the election on December 12, 2000 (now don't even get me talking about 2004!).

[mopinko]

28. franken has been saying

he will buy up any of these bonds for 10 cents on the dollar from anyone who thinks they are worthless.
put down the koolaid people. they are worthless only in the event that the u.s.of a. goes bankrupt.
and even without the trust fund, income will cover 80% of obligations for the foreseeable future.

[grytpype]

11. here's a little something

krugman on the trust fund:

http://www.smirkingchimp.com/print.php?sid=18987

bush today saying the trust fund is imaginary:

http://www.kansascity.com/mld/kansascity/news/politics/11318132.htm

How the fuck can he possibly get away with this?

[dweller]

13. can you post some of the relevent bits

from the KC site that is members only?

tia
dp

[grytpype]

16. sorry, I use bugmenot

Bush questions worth of Social Security trust fund

By RON HUTCHESON

Knight Ridder Newspapers

WASHINGTON - Using a government filing cabinet as a prop, President Bush on Tuesday played to fears that the Social Security Trust Fund is little more than a stack of worthless IOUs.

But if the IOUs are worthless, so is the "full faith and credit" of the federal government, independent financial analysts said. The reality is a little more complicated than Bush acknowledged, and it goes to the heart of the debate over Social Security's future.

Experts say both sides in the debate over Social Security mischaracterize the trust fund's worth to make the case that the retirement system is essentially sound, as many Democrats contend, or that it's on the verge of crisis, which is Bush's message.

"I don't like the Democrats saying everything is fine any more than I like the Republicans saying, `House on fire! House on fire!' The truth is somewhere in the middle," said Timothy Smeeding, a professor at Syracuse University's Maxwell School of Citizenship and Public Affairs.

Bush visited the Bureau of Public Debt in Parkersburg, W.Va., on Tuesday to highlight the fact that there's no actual cash in the trust fund, even though Social Security has piled up a $1.7 trillion surplus since it was created in the late 1930s. Payroll taxes collected from workers have exceeded benefits paid to retirees every year since 1984.

Instead of socking the surplus away, the government spent it on other programs and promised to repay it later, with interest. The IOUs are in the form of special-issue Treasury bonds that are stored in an off-white, four-drawer filing cabinet in West Virginia.

"There is no trust fund, just IOUs that I saw firsthand, that future generations will pay," Bush said after inspecting the storage site. "Imagine - the retirement security for future generations is sitting in a filing cabinet."

The Social Security Administration has tried for years to downplay fears that the IOUs are an empty promise. The agency's Web site includes a section that addresses the question, "Is there really a Social Security Trust Fund?"

The SSA's answer: "Yes."

Another SSA Web section address concerns that the bonds are of little value.

"Far from being `worthless IOUs,' the investments held by the trust funds are backed by the full faith and credit of the U.S. Government. The government has always repaid Social Security, with interest," the agency says. "The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the federal government."

Current projections indicate that the value of the government's promise will be put to the test in 2017, when Social Security payroll taxes will fall short of promised benefits. At that point, the Social Security Administration will have to start cashing in its IOUs.

It's happened before. In 1982, Congress avoided any disruption in benefits by borrowing from other government trust funds and taking steps to shore up Social Security that included raising the tax rate and trimming future benefits. The borrowed money was repaid within four years.

Now Social Security faces new financial strains as the baby boom generation nears retirement age.

"The money has not been set aside, but there is a promise. We're going to have to get that money somewhere," Smeeding said. The government could meet its commitment by raising income taxes or Social Security payroll taxes, by trimming future benefits or by combining the two approaches, and it could issue more bonds - new debt - to raise the money.

Abandoning the commitment to pay off the trust-fund bonds isn't considered a realistic option, even by those who like to say the trust fund is worthless.

"The Social Security Trust Fund is a promise to raise taxes later," said Brian Riedl, a budget analyst at the Heritage Foundation, a conservative research center. "It's worthless in the sense that you cannot pay benefits with the IOUs in the trust fund."

Bush's plan for private investment accounts is a side issue.

He acknowledges that his proposal to let younger workers invest some of their Social Security taxes in stocks and bonds would do nothing to make Social Security solvent. He hopes that workers could use profits from the accounts to offset cuts in their future retirement benefits under traditional Social Security.

Both sides agree that the key to fixing the retirement program is finding a way to make sure the government can meet its future obligations.

"There is a trust fund backed by the full obligation of the U.S. government, but that doesn't change the fact that we do have a problem," said William Novelli, the chief executive of AARP, a seniors' organization that opposes Bush's plan for private accounts. "We ought to address it now."

Bush said essentially the same thing Tuesday during his trip to West Virginia.

"Franklin Roosevelt did a good thing when he created the Social Security system. It's worked. But the math has changed," he told a crowd at West Virginia University after his trip to the filing cabinet. "The longer we wait, the more costly it's going to be to a future generation of Americans."

[dweller]

19. nominated

:kick:

somebody else please vote and put this up on the greatest/front page please.

"Instead of socking the surplus away, the government spent it on other programs and promised to repay it later, with interest. The IOUs are
in the form of special-issue Treasury bonds that are stored in an off-white, four-drawer filing cabinet in West Virginia.

"There is no trust fund, just IOUs that I saw firsthand, that future generations will pay," Bush said after inspecting the storage site.
"Imagine - the retirement security for future generations is sitting in a filing cabinet."

The Social Security Administration has tried for years to downplay fears that the IOUs are an empty promise. The agency's Web site includes
a section that addresses the question, "Is there really a Social Security Trust Fund?"

The SSA's answer: "Yes."

what did the *moron monkeyboy math impaired dumbass think he would find, billion $$ bills in that filing cabinet?

btw, that's a treasonous statement he's making...he's undermining the security of our economy and a great portion of our population.

dp

[grytpype]

20. thx for the nom

[dweller]

22. still need one more...

:kick:

dp

[Igel]

33. The trust fund is held by the government.

It's not separate from the government; it's merely held by a branch of it.

Could you imagine the DOE suing the FDA for money "loaned", especially if Congress is the one that arranged the loan? You would think their boss would at some point be involved.

The bonds will only be presented for redemption if the government authorizes the government to present them to the government for payment by the government. Default on the bonds is just as possible as forgiveness of the debt.

[Kansas Wyatt]

6. If Bush thinks he can spend the Trust Fund...

Like revenue from income taxes, he has defrauded the American people.

Regardless of what the Hell he thinks he knows, there is a very big difference between the Social Security Trust Fund and revenue generated from income taxes. Payroll taxes and income taxes are NOT the same thing.

What he is trying to do is no different from a banker embezzling money from people who have deposited money in that bank to cover his losses.

On Edit: Shrub, you better buckle down on that military spending and start taxing the Hell out of your base until the debt is paid off in full, and you can begin with seizing and liquidating Halliburton first.

[indepat]

10. He is spending the trust fund like it were revenue from income taxes, but

and ain't nobody gonna' stop him.

[BeFree]

18. Years and years

I wish we could blame b**h for this debacle, but congress has been spending the extra SS funds for many a year now. Easy come, easy go.

It is actaully the fault of our glorious and honorable congress.

[smoogatz]

29. Many a year now...

Except for the Clinton surplus years, of course.

[indepat]

30. So true, but GWB is the first to convey those IOUs are worthless, i.e.,

the government has no intention of redeeming those IOUS so the big push now is to greatly reduce benefits of future SS beneficiaries: most future beneficiaries will likely receive a very negative return on those payroll taxes which were taxed up front.

[Deja Q]

15. If * won't put FAITH behind them, why not give us our fuckin' money back?!

x(

FAITH, my ass, *. Maybe the Pope was right... In which case I'll repent my sin of being a homo, even though that pales in comparison with being the Anti-Christ, if that's proven.

Indeed, the money I'd get back and not give would allow me to pay off my debts responsibly. But, there we go again, my debts pale compared to the government's. Wish you got to follow the same rules you put us all through.

[grytpype]

23. Here's Josh Marshall's take on this

Here's Josh Marshall's take on this, basically he agrees with me:

http://www.talkingpointsmemo.com/archives/week_2005_04_03.php#005342

[dweller]

24. AP story

http://staging.hosted.ap.org/dynamic/stories/B/BUSH?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2005-04-05-20-17-51


Bush Questions Social Security Trust Fund

By DEB RIECHMANN
Associated Press Writer

PARKERSBURG, W.Va. (AP) -- President Bush
on Tuesday turned a government file cabinet
in the hills of West Virginia into his Exhibit A
for why Social Security needs urgent change.

To dramatize Social Security's future solvency
problem, the president peered into the
four-drawer ivory cabinet inside the Bureau of
Public Debt office here along the Ohio River.
In the second drawer was a white three-ring
binder filled with pieces of paper providing
physical evidence of $1.7 trillion in Treasury bonds that back Social Security
benefits.

"Imagine," Bush said in a speech a short time later at West Virginia University at
Parkersburg. "The retirement security for future generations is sitting in a filing
cabinet.

"It's time to strengthen and modernize Social Security for future generations
with growing assets that you can control, that you call your own - assets that the
government can't take away."

Democrats quickly labeled Bush's trip to
Parkersburg as nothing more than a gimmicky
photo-op meant to mislead Americans into
thinking that drastic reform is needed to fix the
system's solvency problems.

The pieces of paper Bush saw are not real Treasury securities. In today's
computer age, investors no longer get honest-to-goodness Treasury bonds they
can hold in their hands. However, by law, the bureau creates paper bonds to put
in the file cabinet just in case anybody, like Bush, wants to see the trust fund.

a bit more at link.
dp

[dweller]

25. LA Times

March 6, 2005



Real Bonds, and Worries, Draw Interest
The Social Security trust fund and its ample IOUs are key in the debate over altering the system.

By Joel Havemann, Times Staff Writer

WASHINGTON — Yes, Mary Platz, there really is a Social Security trust
fund. You can find it — about $1.7-trillion worth of special-issue Treasury
bonds — in a Bureau of the Public Debt safe in Parkersburg, W.Va.

Platz, 78, of Mableton, Ga., was one of many people who complained to their
representative in Congress at meetings around the country in recent weeks, that
the government was squandering its surplus Social Security funds on other
federal programs.

"We need to do something to keep from taking money out of Social Security," Platz told Rep.Phil Gingrey (R-Ga.).

The trust fund has become an integral part of the debate over President Bush's proposal to allow
workers to divert some of their payroll taxes into private retirement
accounts invested at their discretion. Everyone agrees, as Platz complained, that the
government has been spending money from the fund — money raised
through the Social Security tax and that is
intended for future retirees.
But debate has escalated over whether the government has the
ability — or even a reliable intent — to repay
that money to the retirement system. As
Bush battles his critics over his plan to
restructure Social Security, both sides are
characterizing the trust fund and the IOUs it
holds in sharply different ways.
http://www.latimes.com/news/nationworld/nation/la-na-trust6mar06,0,5665245.story?coll=la-home-headlines

dp

[Ganja Ninja]

32. For Christ sakes!

IOU's are something you get from your brother in-law. The Social Security trust fund has US Treasury Bonds in it. I wish the LA Times and any other news organization in the future would stop referring to them as "IOU's".
:banghead::banghead::banghead::banghead::banghead::banghead::banghead::banghead::banghead:

[dweller]

26. Bush Plans Heist of $1.7 TRILLION from Social Security Trust Fund

by Bob Fertik on 04/03/2005 5:28pm. - revised 04/03/2005 6:40pm

Call Homeland Security! It looks like Bush is casing the Treasury's bond vault to plan his heist of $1.7 TRILLION in Treasury Bonds.

Gross said one reason the president will make his third trip to Parkersburg in the last 11 months is to tour and be briefed
on the Bureau of Public Debt, which employs nearly 1,700 men and women in Wood County.

"This is a center that, in a sense, houses the IOUs of Social Security," Gross said.

About $1.7 trillion in special-issue Treasury bonds that make up the Social Security trust fund are kept at the bureau.

"The president seeks to highlight the fact that the IOUs housed at Parkersburg are a good example of why this system needs to be fixed," Gross said.

Bush has repeatedly dismissed these bonds as possibly worthless:

3/10/05 Montgomery:

This is a pay-as-you-go system. Money goes in and money goes out. There's no such thing, by the way, as a Social Security trust. Some people probably
think that the government has taken your payroll taxes and held it for you and then when you retire, they give it back to you. That's not what happens.
(Laughter.) The government takes your money and spends it on other things and puts an IOU, a piece of paper, on your behalf, which may be worth
something, and it may not be worth something.

3/18/05 Orlando:

The system today, you have no assets. The money goes in and it goes out. There's IOUs. They're paper. But there's no asset base.

Josh Marshall has one simple question that every reporter covering this trip should ask - and keep asking until they get a straight answer:

Does the president believe that those Treasury notes are backed by the full faith and credit of the United States and will he guarantee those funds will be
repaid?

This is no trivial matter: Bush could be impeached under the 14th Amendment for questioning the validity of these Treasury notes.

Section. 4. The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and
bounties for services in suppressing insurrection or rebellion, shall not be questioned.

http://www.democrats.com/node/4117

bold partly mine, some in article.
dp

[grytpype]

27. Sad but true. It's unbelievable.

[muriel_volestrangler]

31. I see 3 possibilities

1) Bush is so dumb that, after obtaining (somehow) an MBA, years of supposedly being in charge of businesses (which did admittedly fail), being a governor of one of the biggest states, and then president for over 4 years, he still doesn't understand basic economics

2) He is a shameless liar who will do anything to scare gullible voters into accepting his plan to make them pay some of their hard earned wages to Wall St. brokers, whether they like it or not

3) He actually is planning on stealing the trust fund, by selling it off at a discounted price to Wall Street, and then claiming he got a good deal on it. This is just the first stage in the con job. By the end, he be saying the US government is so untrustworthy that they are junk bonds that are only worth pennies. Ironically, this is sort of a self-fulfilling prophecy.

All three choices are terrifying. :scared: