I understand where you're coming from, being bothered by "pseudoscience". I often find science fiction on TV, in movies, and in print to be so flagrantly implausable that it's unbearable. However, I also think that to be fair you should apply your same stringent criteria to other pieces of science fiction, especially to episodic television shows. If you do, I believe you must aknowledge BSG to be at least as good as and perhaps much better than most of the other shows out there. Would the catalog of "Star Trek" series survive your level of critique? Would "Star Wars"? What about popular and critically-acclaimed sci-fi in print, like the "Hyperion" books? Is there anything worth watching or reading?
I'd like you to consider something else, too. Are you absolutely positive you know enough, not just about the abundance of water in the universe, but about the state of BSG technology, about the threat they face, and about the urgency of their resource needs, to know for sure that it would be "easy" for them to find/mine water? Even if we, here on Earth, had similar interstellar space travel technology, are you certain it would be easy for us to do so? Maybe your opinion is "yes and yes", and that's your right. But it is my opinion that you are denying yourself--and in a way encouraging others do do so also--a show that can plausibly be argued is among the best sci-fi on TV.
I submit "as a single mass" as a reasonable translation of en masse from French to English, the need for which is evident to the reader who notices that neither "en" or "masse" are common English words. I doubt many people would interpret the English construction "in mass" to mean the same thing, if they even managed any interpretation at all. I conclude that the two "terms" do not have the same utility in conversation and are not interchangeable.
Okay, now after putting hundreds of thousands of dollars into "Social Security", you die one month after you retire, how much does your family get? The answer to the second question is a big fat zero
I do not understand how this categorical statement ever admits the possibility of "exceptions". In fact, the "exceptions" you alluded to, by my lights are the very events prohibited by your statement.
If I may paraphrase your statement above, you seem to be saying:
"The family of a person who has contributed sufficient credits to Social Security to qualify for full benefits will neverthless receive no benefits if that person dies one month after they retire."
I wrote, essentially,
"I have personal knowledge of such a person, and yet their family member [i.e., my sainted mother] receives his pension, now, today"
According to the loose criteria by which Treasury Bonds are commonly judged by SS opponents to be "IOUs", dollar bills and stock certificates are also IOUs. Think about that.
I have no problems taxing future people, especially future rich people, to pay for my retirement benefits. Some of those future people will be my grandchildren, and I will make sure THEY don't mind. I will tell them, to pay for our generation's retirement is the least they could do considering the life we gave them and the world we bequeathed to them. I will tell them they'll get it back from their grandchildren, just as I intend to get it back from mine. I have been taxed to pay other peoples' benefits, I have been taxed and had that money loaned to the Treasury to fund government projects (some good, some not so much), and I have been taxed to repay loans the government has made to other people. Maybe I'll come out ahead, maybe I won't. Either way, I do not mind.
The government could pass a law tomorrow spurning their obligation to repay the T-Bills and throwing the Trust Fund into default. It could also pass a law banning Country and Western music. The ensuing sh*t storm in either case would be similarly awesome. Heads would roll. It will not happen.
You really should get a grip on the idea that an argument that assumes the consequent is circular, and fallacious. Nothing really restrains the Government from passing a new law, other than the fear its representatives will lose elections. Exactly.
"Idiot argument"??? I should have timed how long it would take for this discussion to devolve into ad hominem.
I have argued that having the Trust Fund circumscribes the behavior of future legislatures, and its absence would grand them greater latitude. These conditions admit the possibility of different financial behavior. Mon dieu! Le Trust Fund, c'est vrai!
If my father had set up a 401(k), then just as his SS pension benefits have not vanished, it too would not have vanished the instant he died. Of course, neither is any comfort to my dear old pop as he reclines on a fluffy white cloud, plucking "Unchained Melody" on his golden harp.
Further up the thread you wrote that if a worker contributes to SS, then dies, the person's family gets nothing. Now, you have written that there exist exceptions for surviving family members. I don't understand. You seem to be contradicting yourself.
I do not believe in the tooth fairy or the Easter bunny. I do believe that many politicians are dedicated public servants, though sadly, not all are.
Bonds do constrain the government, because when its debt burden becomes large, it dominates the news, becomes a hot political issue, and prompts reform, as happened in the early 90s. This occurs for any kind of debt, short-term or long term.
Depending on how old "we" are now and what "our" circumstances are it may not be "we" who pay extra taxes to redeem Trust Fund bonds beginning in 2018. Many future taxpayers are currently in elementary school; other have not yet been born. Further, the Trust Fund was built largely by working class people paying extra SS and payroll taxes in an era when wealthier people enjoyed a plummeting marginal tax rate. Future "progressive" tax increases would tax a different class of people than we who built the Trust Fund. Last, future workers will live in a larger economy, will have higher wages, and will have more resources available to redeem the Trust Fund.
If there is "NO Trust Fund", then it raises many questions. If the government "raised taxes" in 2018 to pay SS benefits, how would that work? Would money be transferred directly into SS from the general fund? Who's taxes would be raised? Everyone's? Middle-class workers? Wealthy people? What's the guarantee that they would have to raise revenue (through taxes, or borrowing, or whatever) as opposed to simply cutting benefits?
It is not at all a settled matter that the government would "do the same thing, at the same time".
The existence of the Trust Fund guarantees that SS benefits will be funded beyond 2018, come hell or high water.
I argue that saying "the Trust Fund does not exist" is equivalent to saying "its bonds will be defaulted". They mean the same.
Besides raising revenue through tax hikes, another option is to reduce discretionary spending. Further, within tax policy the revenue mix from various income types can be tailored (translation: soak the rich!) In practice, it will be some combination of the above.
The government has many options for storing money, as do individuals. The debt option (i.e., selling bonds) has certain virtues, and essentially works like this. It constrains the government to spend its tax revenues in different ways in different eras. In the era of high worker-to-retiree ratios, the government is encouraged to spend on "society" (national security, defense against infectious diseases, universities, water & power, etc.), and in the era of of low worker-to-retiree ratios, the government is constrained to spend more on retirement benefits. Under ideal circumstances (i.e., honest politicians administer statecraft with dispassion in the midst of reasoned debate conducted by a well-informed citizenry) it can be a very smart way to manage resources across generations while enjoying a growing economy. Of course, conditions are not ideal. Your results may vary.
"Most of it wound up in the hands of government bureaucrats...who never met pork they didn't like"
The money that was borrowd from the Trust Fund--and which will be repaid--is being spent, there's no doubt about that. And no problem, either, if what it's spent on is of value.
I presume your argument to be that the money was mostly wasted on things of little or no value. Obviously, that's a judgement call, but I don't think I'd be out of line to suggest that many people will regard your unsupported claim as a wild exaggeration.
This money is accounted for. To say otherwise is to imply that the SS Trust Fund has no or inaccurate records of its holdings, or that the government disputes its claims, or that the government does not dispute its claims but intends to default on them anyway. All of these are ridiculously implausible events.
This "IOU" is sometimes referred to as a "treasury security" because it is, in fact, a treasury security. It cannot be traded because it is held in communion with all other bonds in the Trust Fund, on behalf of American citizens. That does not mean it does not exist, any more than a publicly owned bridge, which also cannot be sold or traded by an individual, does not exist.
It is also true that no funds are "set aside" to meet these...what do you call them..."pseudo" obligations. Does the government ever "set aside" money to redeem OTHER treasury securities in the future? Where does it set it aside? Into its mattress?
a) You're forgetting the extra money that will come from raising the ~$80K cap on FICA taxes, from raising the 12.4% FICA tax rate, from future borrowing, from the sale of public lands, from cuts elsewhere (hello, Pentagon?), or some combination thereof. Oh, and modest benefit cuts will help too.
b) The withering FICA tax revenues obtained amidst the wintry economic climate you depict will be almost as bad as the depressing returns from the stock market in this dismal dystopian era.
c) Either the government will honor its debt obligations, as it always has and is legally bound to, or it will will change the law and enter default. Are you honestly arguing for default?
d) Many people with a buy and hold-for-retirement strategy in the stock market WILL do very well. Of course, it won't be adjusted for price inflation, let alone wage inflation. And they won't do well if they're unlucky enough to retire during a downturn. Or have a spouse die too young. Or become disabled themselves.
Yes, future citizens will be taxed to pay the benefits of future beneficiaries, who commonly will be their parents, their aunts and uncles, their grandparents, and the widows and disabled among them. Will they begrudge this? Perhaps, but I for one intend to raise my children to know better, and to recognize the contours of a civilized society. Perhaps their minds will be comforted knowing the money in the Trust Fund--that quaint relic of a bygone era--was "spent" on hopefully durable bridges, roads, and spaceports, and to secure the safe and prosperous world we labor to create for them.
As for your second point, perhaps you know what you're talking about. All I know is, my father passed away this Fall and my mother now receives his Social Security pension. Not too shabby in my book.
Stock is not an IOU from a corporation. It represents ownership. When a corporation is worth something, a little sliver of it is also worth something. When you buy and sell stock, you're just trading the little slivers of a company (maybe a desk or a coffee machine's worth) for money.
I guess you're saying something like, "stock [has value, unlike Treasury Bonds, because it] represents ownership [in] a coporation [which is] worth something [and therefore has value]". As it stands, this is a tautology, amounting to "stock has value because it has value." Ironically, it's actually the truth--as it is for all assets--because it boils down to "assets have the value that, by agreement, we assign to them". The theory of money can be put many ways, but that's one way.
In any event, to derive the value of a company from that of its physical assets (desks, coffee machines) is naive, because thriving companies are worth much more than that. They are worth the net present value of all of their future income (or profits, depending on how you slice it). If that is ever less than the value of their physical assets, they're vulnerable to takeover and dismemberment. A stock certificate is "ownership" in the company in that it is a right to claim a portion of that future revenue stream. In practice, that right can be, and often is, forfeited. Companies refuse to pay dividends, and sometimes go bankrupt. What real thing do you "own" if that occurs?
So stocks very much are like Treasury Bonds. They're a promise, and like all promises, they can be broken.
What about banks? Well, the bank has to redeem the money in your account on demand, up to a point. Not on bank holidays if you can't find an ATM, and certainly not if they go under. And with inflation, even the money they give back to you may not be worth all that much in the future. So much for bank "ownership" in "property". Again, it's little more than a promise, that can be broken.
If this sounds like semantic horse sh*t, perhaps it is, but then that's where you end up when people start yelling "There's NO Trust Fund!!!"
SS has run a substantial surplus for 20 years, as it will for another decade. If not in Treasury Bonds, then in what would you recommend the government invest? The stock market? That really is too risky, the market distortion would be huge, and the fees would be a politically radioactive issue. Where else? Foreign currency? Precious metals? Land? A mattress? The money has to go somewhere. Investing it in Treasury Bonds is a sound practice, in which structural constraints are placed on future government budgets, with greater spending freedom allowed today. The government is making a hard promise to itself: "ok, spend extra money today on things you'll need, like bridges, highways, the military, etc., because in the future you're going to have to tighten the belt, skip the second pass at the buffet, and go without that extra aircraft carrier or two, because we'll need to spend more on retirees then."
That would be one possible course of action. Whether it is "proper" or even desirable is another matter. Without the the Trust Fund buffer, SS financing beomes tightly coupled to current economic performance. Maintaining SS's commitments during periods of very modest economic performance would then be impossible, orat least very painful. It's not at all clear that this would be proper or even wise public policy.
In other circles these "IOUs" are also known as "Treasury Bonds" and they are among the most reliable investments in existence. They are deemed reliable because, without a change in the law, they cannot be defaulted upon. They are sold to many other individuals, banks, companies, and nations, none of whom worry about being repaid. Why should we?
The fact is, there is 0 chance the Trust Fund will be thrown into default by the government, yet precisely this is the only sense, I argue, in which the canard "The Trust Fund does not exist (exclamation mark)" can have any meaning.
The Trust Fund, and its bonds, represent a permanent set-aside of future tax revenues, to be redeemed on behalf of SS beneficiaries. The government at all times knows what its real outstanding debt obligations are, and adjusts accordingly, with either revenue increases (say, higher taxes) or spending cuts (say, the military).
The Trust Fund is built from excess payroll taxes paid dispraportionately by middle-income people, with the understanding we'd be repaid in future SS benefits. To say the Trust Fund does not exist, that its bonds are worthless and should not be redeemed (i.e., defaulted upon), would be to argue for a massive intergenerational wealth transfer from middle-income people to wealthier people, and would force a wholesale reevaluation of current and past tax rates. This will not happen.
- Politicians have been spending the SS income rather than investing it for years now.
This is not possible. Social Security tax surpluses purchase Treasury bonds which, without a change in the law, cannot be defaulted upon.
- There are going to be more people collecting from SS when the baby boomers retire than there will be contributing to it.
This is unlikely. Perhaps "The Unpossible" meant--which is true--that there will be fewer contributors per beneficiary in the future than there have been in the past. That this will occur was understood in 1983, and it is why the Trust Fund was created.
If you raise taxes, it won't help social security, it will result in more spending, though.
If you raise the payroll tax rate, raise its ceiling, or both, Social Security will be able to pay scheduled benefits for longer into the future.
It's a broken system. You can either start to fix it, or you can try to prop it up until it completely collapses.
If nothing else is done, Social Security will always continue to pay benefits, even after the Trust Fund is exhausted. If the economy grows at at least a modest rate, SS will pay roughly 3/4 of scheduled benefits immediately after the mid-century shortfall. It is unlikely that most people would call this a "broken system" in danger of "collapse".
I bought a Zen Micro for my girlfriend for Christmas; it's what she wanted. Neither of use could use the touch pad interface effectively. I installed the most recent firmware upgrade, which is supposed to alleviate touch pad problems. It was still a disaster. After three days, I sent it back. The problems are: 1) wasted real estate: most of the touch pad surface area is devoted to rarely used functions, 2) inconsistent sensitivity: sometimes light touches would activate a function, sometimes they wouldn't, and sometimes even firm contact would fail to activate a function, 3) scroll pad is also used to select items; errant selections while navigating menus are frequent, rendering it practically unusable. It's like a little torture device.
Also, the PC software is terribly unintuitive. And, except for the colored faceplate, all units have the same sickening white form factor as the iPods, and in two-tone it's actually much uglier.
My recommendation is this. If you're considering the Zen Micro, try a friend's first for a day or so to see if you like it. There's just too high a risk otherwise.
Also, I considered the possibility that I had a "lemon", but if that's true then Creative has a quality control problem and so I still wouldn't recommend them.
Slashdot Mirror
You wrote, "Every release since then has suffered badly from bloat and other crud."
Please explain.
I understand where you're coming from, being bothered by "pseudoscience". I often find science fiction on TV, in movies, and in print to be so flagrantly implausable that it's unbearable. However, I also think that to be fair you should apply your same stringent criteria to other pieces of science fiction, especially to episodic television shows. If you do, I believe you must aknowledge BSG to be at least as good as and perhaps much better than most of the other shows out there. Would the catalog of "Star Trek" series survive your level of critique? Would "Star Wars"? What about popular and critically-acclaimed sci-fi in print, like the "Hyperion" books? Is there anything worth watching or reading?
I'd like you to consider something else, too. Are you absolutely positive you know enough, not just about the abundance of water in the universe, but about the state of BSG technology, about the threat they face, and about the urgency of their resource needs, to know for sure that it would be "easy" for them to find/mine water? Even if we, here on Earth, had similar interstellar space travel technology, are you certain it would be easy for us to do so? Maybe your opinion is "yes and yes", and that's your right. But it is my opinion that you are denying yourself--and in a way encouraging others do do so also--a show that can plausibly be argued is among the best sci-fi on TV.
Peace
D
I submit "as a single mass" as a reasonable translation of en masse from French to English, the need for which is evident to the reader who notices that neither "en" or "masse" are common English words. I doubt many people would interpret the English construction "in mass" to mean the same thing, if they even managed any interpretation at all. I conclude that the two "terms" do not have the same utility in conversation and are not interchangeable.
My bad. I guess I was thinking along the lines of this series of Wikipedia articles:
Logical tautologies use circular reasoning within an argument or statement
and
A circular argument is one which assumes the very thing it aims to prove
Perhaps these Wikipedia articles are in need of editing.
Regards,
David
Isn't a "tautology" an argument that assumes the consequent, and is therefore circular?
If I may paraphrase your statement above, you seem to be saying:
"The family of a person who has contributed sufficient credits to Social Security to qualify for full benefits will neverthless receive no benefits if that person dies one month after they retire."
I wrote, essentially,
"I have personal knowledge of such a person, and yet their family member [i.e., my sainted mother] receives his pension, now, today"
To which you replied, seemingly,
"Well, that's an exception".
Do you understand why I am confused?
According to the loose criteria by which Treasury Bonds are commonly judged by SS opponents to be "IOUs", dollar bills and stock certificates are also IOUs. Think about that.
I have no problems taxing future people, especially future rich people, to pay for my retirement benefits. Some of those future people will be my grandchildren, and I will make sure THEY don't mind. I will tell them, to pay for our generation's retirement is the least they could do considering the life we gave them and the world we bequeathed to them. I will tell them they'll get it back from their grandchildren, just as I intend to get it back from mine. I have been taxed to pay other peoples' benefits, I have been taxed and had that money loaned to the Treasury to fund government projects (some good, some not so much), and I have been taxed to repay loans the government has made to other people. Maybe I'll come out ahead, maybe I won't. Either way, I do not mind.
The government could pass a law tomorrow spurning their obligation to repay the T-Bills and throwing the Trust Fund into default. It could also pass a law banning Country and Western music. The ensuing sh*t storm in either case would be similarly awesome. Heads would roll. It will not happen.
You really should get a grip on the idea that an argument that assumes the consequent is circular, and fallacious. Nothing really restrains the Government from passing a new law, other than the fear its representatives will lose elections. Exactly.
"Idiot argument"??? I should have timed how long it would take for this discussion to devolve into ad hominem.
I have argued that having the Trust Fund circumscribes the behavior of future legislatures, and its absence would grand them greater latitude. These conditions admit the possibility of different financial behavior. Mon dieu! Le Trust Fund, c'est vrai!
Au revoir
If my father had set up a 401(k), then just as his SS pension benefits have not vanished, it too would not have vanished the instant he died. Of course, neither is any comfort to my dear old pop as he reclines on a fluffy white cloud, plucking "Unchained Melody" on his golden harp.
Further up the thread you wrote that if a worker contributes to SS, then dies, the person's family gets nothing. Now, you have written that there exist exceptions for surviving family members. I don't understand. You seem to be contradicting yourself.
I do not believe in the tooth fairy or the Easter bunny. I do believe that many politicians are dedicated public servants, though sadly, not all are.
Bonds do constrain the government, because when its debt burden becomes large, it dominates the news, becomes a hot political issue, and prompts reform, as happened in the early 90s. This occurs for any kind of debt, short-term or long term.
Depending on how old "we" are now and what "our" circumstances are it may not be "we" who pay extra taxes to redeem Trust Fund bonds beginning in 2018. Many future taxpayers are currently in elementary school; other have not yet been born. Further, the Trust Fund was built largely by working class people paying extra SS and payroll taxes in an era when wealthier people enjoyed a plummeting marginal tax rate. Future "progressive" tax increases would tax a different class of people than we who built the Trust Fund. Last, future workers will live in a larger economy, will have higher wages, and will have more resources available to redeem the Trust Fund.
If there is "NO Trust Fund", then it raises many questions. If the government "raised taxes" in 2018 to pay SS benefits, how would that work? Would money be transferred directly into SS from the general fund? Who's taxes would be raised? Everyone's? Middle-class workers? Wealthy people? What's the guarantee that they would have to raise revenue (through taxes, or borrowing, or whatever) as opposed to simply cutting benefits?
It is not at all a settled matter that the government would "do the same thing, at the same time".
The existence of the Trust Fund guarantees that SS benefits will be funded beyond 2018, come hell or high water.
I argue that saying "the Trust Fund does not exist" is equivalent to saying "its bonds will be defaulted". They mean the same.
Besides raising revenue through tax hikes, another option is to reduce discretionary spending. Further, within tax policy the revenue mix from various income types can be tailored (translation: soak the rich!) In practice, it will be some combination of the above.
The government has many options for storing money, as do individuals. The debt option (i.e., selling bonds) has certain virtues, and essentially works like this. It constrains the government to spend its tax revenues in different ways in different eras. In the era of high worker-to-retiree ratios, the government is encouraged to spend on "society" (national security, defense against infectious diseases, universities, water & power, etc.), and in the era of of low worker-to-retiree ratios, the government is constrained to spend more on retirement benefits. Under ideal circumstances (i.e., honest politicians administer statecraft with dispassion in the midst of reasoned debate conducted by a well-informed citizenry) it can be a very smart way to manage resources across generations while enjoying a growing economy. Of course, conditions are not ideal. Your results may vary.
Printing money would generate inflation. I prefer higher taxes combined with reduced spending elsewhere and also modest benefit cuts, personally.
Raise the payroll tax, raise the employee's SS tax, or both. Whichever. Just don't THINK about defaulting on the bonds.
"Most of it wound up in the hands of government bureaucrats...who never met pork they didn't like"
The money that was borrowd from the Trust Fund--and which will be repaid--is being spent, there's no doubt about that. And no problem, either, if what it's spent on is of value.
I presume your argument to be that the money was mostly wasted on things of little or no value. Obviously, that's a judgement call, but I don't think I'd be out of line to suggest that many people will regard your unsupported claim as a wild exaggeration.
This money is accounted for. To say otherwise is to imply that the SS Trust Fund has no or inaccurate records of its holdings, or that the government disputes its claims, or that the government does not dispute its claims but intends to default on them anyway. All of these are ridiculously implausible events.
This "IOU" is sometimes referred to as a "treasury security" because it is, in fact, a treasury security. It cannot be traded because it is held in communion with all other bonds in the Trust Fund, on behalf of American citizens. That does not mean it does not exist, any more than a publicly owned bridge, which also cannot be sold or traded by an individual, does not exist.
It is also true that no funds are "set aside" to meet these...what do you call them..."pseudo" obligations. Does the government ever "set aside" money to redeem OTHER treasury securities in the future? Where does it set it aside? Into its mattress?
a) You're forgetting the extra money that will come from raising the ~$80K cap on FICA taxes, from raising the 12.4% FICA tax rate, from future borrowing, from the sale of public lands, from cuts elsewhere (hello, Pentagon?), or some combination thereof. Oh, and modest benefit cuts will help too.
b) The withering FICA tax revenues obtained amidst the wintry economic climate you depict will be almost as bad as the depressing returns from the stock market in this dismal dystopian era.
c) Either the government will honor its debt obligations, as it always has and is legally bound to, or it will will change the law and enter default. Are you honestly arguing for default?
d) Many people with a buy and hold-for-retirement strategy in the stock market WILL do very well. Of course, it won't be adjusted for price inflation, let alone wage inflation. And they won't do well if they're unlucky enough to retire during a downturn. Or have a spouse die too young. Or become disabled themselves.
Yes, future citizens will be taxed to pay the benefits of future beneficiaries, who commonly will be their parents, their aunts and uncles, their grandparents, and the widows and disabled among them. Will they begrudge this? Perhaps, but I for one intend to raise my children to know better, and to recognize the contours of a civilized society. Perhaps their minds will be comforted knowing the money in the Trust Fund--that quaint relic of a bygone era--was "spent" on hopefully durable bridges, roads, and spaceports, and to secure the safe and prosperous world we labor to create for them.
As for your second point, perhaps you know what you're talking about. All I know is, my father passed away this Fall and my mother now receives his Social Security pension. Not too shabby in my book.
Stock is not an IOU from a corporation. It represents ownership. When a corporation is worth something, a little sliver of it is also worth something. When you buy and sell stock, you're just trading the little slivers of a company (maybe a desk or a coffee machine's worth) for money.
I guess you're saying something like, "stock [has value, unlike Treasury Bonds, because it] represents ownership [in] a coporation [which is] worth something [and therefore has value]". As it stands, this is a tautology, amounting to "stock has value because it has value." Ironically, it's actually the truth--as it is for all assets--because it boils down to "assets have the value that, by agreement, we assign to them". The theory of money can be put many ways, but that's one way.
In any event, to derive the value of a company from that of its physical assets (desks, coffee machines) is naive, because thriving companies are worth much more than that. They are worth the net present value of all of their future income (or profits, depending on how you slice it). If that is ever less than the value of their physical assets, they're vulnerable to takeover and dismemberment. A stock certificate is "ownership" in the company in that it is a right to claim a portion of that future revenue stream. In practice, that right can be, and often is, forfeited. Companies refuse to pay dividends, and sometimes go bankrupt. What real thing do you "own" if that occurs?
So stocks very much are like Treasury Bonds. They're a promise, and like all promises, they can be broken.
What about banks? Well, the bank has to redeem the money in your account on demand, up to a point. Not on bank holidays if you can't find an ATM, and certainly not if they go under. And with inflation, even the money they give back to you may not be worth all that much in the future. So much for bank "ownership" in "property". Again, it's little more than a promise, that can be broken.
If this sounds like semantic horse sh*t, perhaps it is, but then that's where you end up when people start yelling "There's NO Trust Fund!!!"
SS has run a substantial surplus for 20 years, as it will for another decade. If not in Treasury Bonds, then in what would you recommend the government invest? The stock market? That really is too risky, the market distortion would be huge, and the fees would be a politically radioactive issue. Where else? Foreign currency? Precious metals? Land? A mattress? The money has to go somewhere. Investing it in Treasury Bonds is a sound practice, in which structural constraints are placed on future government budgets, with greater spending freedom allowed today. The government is making a hard promise to itself: "ok, spend extra money today on things you'll need, like bridges, highways, the military, etc., because in the future you're going to have to tighten the belt, skip the second pass at the buffet, and go without that extra aircraft carrier or two, because we'll need to spend more on retirees then."
That would be one possible course of action. Whether it is "proper" or even desirable is another matter. Without the the Trust Fund buffer, SS financing beomes tightly coupled to current economic performance. Maintaining SS's commitments during periods of very modest economic performance would then be impossible, orat least very painful. It's not at all clear that this would be proper or even wise public policy.
In other circles these "IOUs" are also known as "Treasury Bonds" and they are among the most reliable investments in existence. They are deemed reliable because, without a change in the law, they cannot be defaulted upon. They are sold to many other individuals, banks, companies, and nations, none of whom worry about being repaid. Why should we?
The fact is, there is 0 chance the Trust Fund will be thrown into default by the government, yet precisely this is the only sense, I argue, in which the canard "The Trust Fund does not exist (exclamation mark)" can have any meaning.
The Trust Fund, and its bonds, represent a permanent set-aside of future tax revenues, to be redeemed on behalf of SS beneficiaries. The government at all times knows what its real outstanding debt obligations are, and adjusts accordingly, with either revenue increases (say, higher taxes) or spending cuts (say, the military).
The Trust Fund is built from excess payroll taxes paid dispraportionately by middle-income people, with the understanding we'd be repaid in future SS benefits. To say the Trust Fund does not exist, that its bonds are worthless and should not be redeemed (i.e., defaulted upon), would be to argue for a massive intergenerational wealth transfer from middle-income people to wealthier people, and would force a wholesale reevaluation of current and past tax rates. This will not happen.
- Politicians have been spending the SS income rather than investing it for years now.
This is not possible. Social Security tax surpluses purchase Treasury bonds which, without a change in the law, cannot be defaulted upon.
- There are going to be more people collecting from SS when the baby boomers retire than there will be contributing to it.
This is unlikely. Perhaps "The Unpossible" meant--which is true--that there will be fewer contributors per beneficiary in the future than there have been in the past. That this will occur was understood in 1983, and it is why the Trust Fund was created.
If you raise taxes, it won't help social security, it will result in more spending, though.
If you raise the payroll tax rate, raise its ceiling, or both, Social Security will be able to pay scheduled benefits for longer into the future.
It's a broken system. You can either start to fix it, or you can try to prop it up until it completely collapses.
If nothing else is done, Social Security will always continue to pay benefits, even after the Trust Fund is exhausted. If the economy grows at at least a modest rate, SS will pay roughly 3/4 of scheduled benefits immediately after the mid-century shortfall. It is unlikely that most people would call this a "broken system" in danger of "collapse".
I bought a Zen Micro for my girlfriend for Christmas; it's what she wanted. Neither of use could use the touch pad interface effectively. I installed the most recent firmware upgrade, which is supposed to alleviate touch pad problems. It was still a disaster. After three days, I sent it back. The problems are: 1) wasted real estate: most of the touch pad surface area is devoted to rarely used functions, 2) inconsistent sensitivity: sometimes light touches would activate a function, sometimes they wouldn't, and sometimes even firm contact would fail to activate a function, 3) scroll pad is also used to select items; errant selections while navigating menus are frequent, rendering it practically unusable. It's like a little torture device.
Also, the PC software is terribly unintuitive. And, except for the colored faceplate, all units have the same sickening white form factor as the iPods, and in two-tone it's actually much uglier.
My recommendation is this. If you're considering the Zen Micro, try a friend's first for a day or so to see if you like it. There's just too high a risk otherwise.
Also, I considered the possibility that I had a "lemon", but if that's true then Creative has a quality control problem and so I still wouldn't recommend them.
How long do you think it will be before Microsoft claims to have already invented this 5 years ago?