Tuesday, December 8, 2009

Crisis by Fiat

While everyone is making Health Care sausage or Environmental (Cap and Tax) sausage or even "Jobs" sausage they are ignoring the mess that is already wrapped around them and us like an anchor – Social Security.

I am one of many out here that does not expect to receive any benefit from all the money seized out of my pay check since 1972 when I filed my first W-4 (I was a dish washer making 90 cents an hour at Geno's on north Coors Road in Albuquerque, they served Mexican and Italian fare). That is some 37 years of contributions to a system that is being ignored and will simply, rot on the vine.

Instead the Wise One, PresBO himself declared Health Care in the US a crisis that needs to be fixed despite more that 80% of the people being not only insured but a vast majority of them happy with their coverage and care. The crisis for who, the 20% or 45 million that don't have insurance and this is important, no one in the US goes without Health Care, some simply don't want or have access to an insurance plan but anyone that needs care can simply walk into a hospital and get that care. So, in my mind without dead bodies lining the roadways here in America, this is a cooked up crisis, very similar to the Climate debate.

Cooked up or books cooked, either way the true crisis in America is the train wreck that Social Security is and no one is talking about that.

Well, maybe not no one: From Economics21 "Social Security's Grim Milestione" a report about the little known fact that for six straight months this last Fiscal year (2009, ending 30 September) the Social Security systems operating budget was completely in the Red. That is to say that its total operating expenses (Benefit outlays and Administration) was all borrowed. For six straight months there was more money outgoing than incoming into the SSA.

Here is a chart: If you look close, there was yet one other month when they ran out of money to run the system, February. This means that for 7 out of the 12 months there was not enough money to run SSA.

Now the recession and high unemployment adds to this money crisis because with fewer people working there are fewer paycheck from which to seize money from. Couple that and the following from Carpe Diem: "4 out of 10 pay NO Income Tax"; a story about how few people actually pays taxes. More 1 in 4 skips out in some way shape or form from paying taxes. A whopping 39% either do not file taxes or file a return with Zero or a Negative tax liability. By the way, Negative in this case means that person gets money from the treasury that they did not contribute into. Note: These numbers do not include all the people in the Obama Administration or in Congress who are evading taxes.

Here is another chart: So, with fewer and fewer people paying taxes, millions more on unemployment and even more holding jobs whose wages have been depressed because of the rescission there will be even less money flowing into that deep pit known as Social Security. I am guessing that there will be 8 or 9 months of negative spending from the SSA this year.

I am almost willing to take bets that Social Security will be completely bankrupt in 2 to 3 years. Watch for an Obama style "takeover", you know "I don't want to be in the Social Security business but…"

BT: Jimmy T sends.


Buck said...

Your points about SS are well taken, Jimmy. But I want you to remain employed and keep paying into the system... coz you're funding my retirement, yanno?

Yeah: I "went early." I saw the moving finger on the wall YEARS ago and I was down at the local SS office on-time and with bells on shortly before I turned 62. So far... so good. But I'm glad I have the 401(k) to fall back on.

Bag Blog said...

I am in agreement. If 80% of the people are insured and fairly happy with their coverage, and the other 20% get their health care free (and certainly don't want to pay for insurance), why would we need all this big health care package. For years, my husband has been saying the SSA is going down. Maybe we need to make all the illegals legal so they can start paying into SS :)

JimmyT said...

Buck, I have 9 more years and I am there, lessn of course I hit the lotto, then it's a life on wheels for me, till they take the drivers license from me.

Lou, the Health Care mess is all drummed up to get socialist/communist hooks into the government and they don't care what burns down around them while they are doing that. As for making all the illegal’s legal, well I would not go that far, they vote democrat which means even more social programs that we can't pay for, it would only get worse. The whole immigration issue is a new post altogether.

BT: Jimmy T sends