Wednesday, March 17, 2010

Connect the dots

Greetings good citizen,

Um, just want to let you know the markets closed ‘up’ today for the seventh session in a row…and what are the ‘headlines’? Aren’t the imbeciles crowing about the markets hitting levels not seen since 2008!

Oh well, what are you gonna do? There’s ‘Happy Talk’ and there’s, uh, ‘mountains out of molehills’ talk. Which is to point out just how ‘poisonous’ conservative propaganda has become, programs that people paid into their entire working lives are now being labeled ‘entitlements’, like it’s something ‘nice’ soft-headed politicians decided to do (at the public’s expense) purely to capture more votes!

Now, after paying in our entire lives, the fucking conservatives are trying to convince today’s young that the Baby Boomer’s are ‘stealing’ THEIR money! (Conveniently ignoring the fact that THEY stole OUR contributions to fund their wars and pay their butt-buddy’s extravagant salaries! But hey, since when do conservatives care about annoying little things like facts?)

All I can say is thank goodness for Blood Pressure meds, onward with tonight’s offering

Connecting the Dots: Social Security Edition

As we have discussed on numerous occasions at Anecdotal Economics since 2006 (see links below), have written about in the dying dead-tree print media since 1999 and have worried about since 1993, the day of reckoning for Social Security drew nigh and now has come and gone, circa 2010.

Only unpleasant decisions lie ahead that will stun the second half of a Baby Boom generation of which some two-thirds essentially have no retirement savings other than the income they think their children and grandchildren will be willing to forego in future years to provide those promised Social Security benefits. [Hard to say what’s worse good citizen, the lies themselves or perpetuating them?]

(Spoiler Alert: That isn't going to happen, although not without a protracted fight which will descend into an ugly inter-generational conflict as income-strapped Millennials, Gen-Xers, Gen-Yers and Echo Boomers refuse to pony up more of their diminishing wages that their savings-strapped parents and grandparents can recline at home beginning at age 62 and watch reruns of Dallas and Knot's Landing. Late Boomers, born between 1954 and 1964, you heard it hear first: Get ready to be employed [Ha!], in some fashion, until at least age 72, maybe age 75, maybe until you are carried out feet first, whichever occurs earlier. (Can you say "Welcome to Wal-Mart?") [There has to be something about being an ‘economist/financial analyst’ that blinds you to reality and makes you spew nonsense! While many ‘Boomers’ have no illusions about their prospects for retirement, where do these idiots think the jobs they’re going to ‘keep’ into their ‘golden years’ are coming from? Most Boomers are ALREADY unemployed! But I shouldn’t be nitpicking, after all, the whole exercise is ‘hypothetical’, isn’t it?]

Social Security, which as recently as a year ago had projected its reckoning day - the point at which annual outgo exceeds withholding tax revenues and interest income - would not approach until at least 2017. No worries, right mate?

Then SSA revised its forecast, advancing the crossover date (in the absence of any program changes) to 2016, a year earlier, but still a long time away in Washington, D.C. years where time virtually crawls. SSA also earlier in the fiscal year estimated its FY 2010 and FY 2011 shortfalls would be about $10 billion. Now the 2010 deficit alone may triple to nearly $30 billion.

Now the Associated Press has "discovered" the day of reckoning already has come and gone, six years early, in a folksy, oh-don't-worry-about-any-of-this piece which seems to find it more interesting that actual, printed, intra-governmental bonds, $2.5 trillion of IOUs, are kept in three-ring binders in the bottom drawer of a locked filing cabinet in West Virginia of all places than the disturbing reality of an insolvent pay-as-we-went retirement entitlement program: [Pardon the interruption but how do you suppose the program became ‘insolvent’? Were the funds ‘mal-invested’ or were they ‘borrowed’ and never returned? Understand good citizen, that EVERY NICKEL of those funds ARE recoverable, it’s just a matter of ‘making it happen’.]

PARKERSBURG, W.Va. – The retirement nest egg of an entire generation is stashed away in this small town along the Ohio River: $2.5 trillion in IOUs from the federal government, payable to the Social Security Administration.

It's time to start cashing them in. For more than two decades, Social Security collected more money in payroll taxes than it paid out in benefits — billions more each year.

Not anymore. This year, for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes — nearly $29 billion more.

Sounds like a good time to start tapping the nest egg. Too bad the federal government already spent that money over the years on other programs, preferring to borrow from Social Security rather than foreign creditors. In return, the Treasury Department issued a stack of IOUs — in the form of Treasury bonds — which are kept in a nondescript office building just down the street from Parkersburg's municipal offices.

Now the government will have to borrow even more money, much of it abroad, to start paying back the IOUs, and the timing couldn't be worse. The government is projected to post a record $1.5 trillion budget deficit this year, followed by trillion dollar deficits for years to come.

Social Security's shortfall will not affect current benefits. As long as the IOUs last, benefits will keep flowing. But experts say it is a warning sign that the program's finances are deteriorating. Social Security is projected to drain its trust funds by 2037 unless Congress acts, and there's concern that the looming crisis will lead to reduced benefits.
(All emphasis added.)

Time for some dot-connecting: From the last paragraph above, "As long as the IOUs last, benefits (to retirees) will keep flowing," shouldn't have gotten past the reporter's editor because it makes an absurd claim disguised as a fact.

Properly edited, that sentence would have read:

"As long as the federal government can keep borrowing 'on-balance-sheet' money from its ever-growing cadre of domestic and international creditors to fund the Social Security deficit and Medicare deficit and fund the massive annual general budget shortfalls projected throughout the decade, the benefits will keep flowing, until such time as Congress is required to break its gilded entitlement promises." [What do you think good citizen, knowing what you know about the ‘nature’ of money? Dickwad is right, the ‘money’ doesn’t exist but people don’t need money, they need resources and those we got! We merely need a way to ‘allocate’ them.]

Peter, meet Paul. And just where is that "lockbox" by the way? [Same thing that’s always been there, dust!] Oh, that's right, that guy didn't win in 2000. (Um, well he might have, but that's ancient history. Paging Mr. Gore...) As the full article correctly observes, the federal government has been "borrowing" the Social Security surplus for more than two decades. (Note: in the private sector, this is illegal. Companies are not allowed to borrow from trust funds established for employee benefits for obvious reasons. Ask your Senators or Congressional Representatives why this is so.)

Now it will borrow again to bridge the deficits, not only from ourselves but from our foreign BFFs who already own such a significant portion of our public national debt it potentially exposes America to financial blackmail, a clear and present national security threat if ever there was one. [Aren’t capitalists weird? With one side of their mouths they’re all about free trade, but out of the other side it’s all about ‘national security’…but when it comes to ‘maximizing personal profits’, national security is on its own!]

But hey, what's $29 billion in FY 2010 against a total projected federal deficit this fiscal year of $1.5 trillion? It's a rounding error, right? Nope, and here's why. As it becomes increasingly likely that at some point within this decade the entitlement promises will have to be broken (and we already have crossed the financial Rubicon as age-62 early retirement and pre-62 disability Social Security benefit applications already are soaring far above SSA projections [Because the job market sucks so bad!]), the accelerating number of early retirement and disability benefit applications, to get while the gettin' is good, will swamp these modest shortfall projections and, in fact, hasten the requirement to radically restructure the entire program. [Um, more than just our national pension program needs a major overhaul!]

That will be the true day of reckoning, some arbitrary date, say five years from now, before which Boomer retirees will qualify for all benefits under the current program and after which, well, sorry about your luck. Judging from trial balloons this Administration has launched over the last six months about entitlement "reform," we will not be surprised when some of us are told, by accident of date of birth, we will not get "our share." Furious, yes, but suprised, no, at least we shouldn't be if we are reading correctly the scribbling of the invisible hand on the wall. [Um, what the fuck is wrong with these nitwits? This is every bit as ridiculous as the fellow last night who insisted we’d be made to turn our children over to the state! I’ll only be in my late fifties in five years time…I may not be able to run but I sure as hell can still squeeze a trigger! What are these fools thinking…PS by the way, I’m also among the older group in the 1954 to 1964 crew, meaning there are a whole bunch of people counted as Boomers who are still hale and hearty.]

Which sets us up for the mother of all inter-generational conflicts. Late Boomers will get squeezed (consider yourself warned) and see their retirement dates kicked far into an unknowable future, but don't be mad at your children and grandchildren - the Boomers would have done the same to their parents and grandparents in a heartbeat. [Now there’s a boldfaced lie! Most people my age are doing contortions to provide for their elderly (and often needy) parents. But the conservative universe is a cold, cruel place…well, every once in a while they let their true feelings slip out…usually when they are accusing others of the same reprehensible behavior.]

And you children and grandchildren of the Boomers, wondering exactly why it is your parents and grandparents have no money saved for retirement...? Before your righteous indignation sets in, please take a moment to remember, fondly, all the Beanie Babies, Pogs, Tomagachis, Furbys, Barbies, Cabbage Patch Kids, music lessons and instruments, athletic lessons and equipment, summer adventure camps, trips to Disney World, skiing at Vail, Back Street Boys concerts, mountain bikes, X-Boxes, Nintendos, Segas and video games, CDs, DVDs, computers, stereos, televisions, cell phones, boom boxes, iPods, iPhones, 4,000 sf suburban homes, automobiles, boats, jet-skis, motorcycles, expensive-but-useless college educations, cosmetic surgery and glitzy/destination weddings which your elders showered upon you throughout your enchanted upbringings. [Um, geez fucktard, you don’t suppose it has anything to do tax cuts for the wealthy while everybody else saw their wages stagnate, do ya? Nah, it could never be something as obvious as that!]

And don't be surprised when they (we) have to move in with you someday. Back to three generations in the same household, but look on the bright side: it might save on childcare expenses, depending on Grandma and Grandpa Boomer's schedules at Wal-Mart.

Maybe pussnuts didn’t pen this all by hisself BUT he posted it to his blog without condemning it and that says something rather disturbing all the same.

Sure, facetious remarks about Grandparents forced to work for minimum wage at Wal-Mart…there’s something about a statement like that which just smacks of ‘Libertarian Justice’.

But hey, stupidity runs rampant these days…and speaking of stupid; I was listening to National rePublican Radio (NPR) this afternoon and some chuckle-head was saying most boomers were short in their ‘retirement savings’…by roughly a quarter of a million dollars!

I don’t know about you Slim but I have yet to earn anywhere near a quarter of a million dollars, and it makes me wonder how Bo-bo thinks I was supposed to get my hands on that kind of money (doing honest work…)

If I still had EVERY NICKEL I ever earned, I’d still be short by roughly half of what this joker was saying. And, naturally, I got to pondering just how he had arrived at this quarter of a million dollars figure?

Unfortunately, I don’t know the answer to that question. I have to assume that his ‘base assumptions’ (or may he himself) was ‘high’.

But that’s not particularly surprising, most conservatives have deep and abiding trouble handling reality. They’re just not equipped to deal with it.

Understand, if these morons succeeded in brainwashing their kids with their own beliefs, then the only ones who will be in any danger (ironically) are them! And THAT’S ‘poetic justice’ in the first degree!

Thanks for letting me inside your head,


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