Social Security is not bankrupt. It has massive assets, and is fiscally sound until sometime in the 2040s. The problem is that the government has borrowed that money and used it for other stuff. It now needs to start paying it back, but that's no different than any other loan you make.

The government has massive liabilities precisely equal to it's massive assets. I could loan myself $100 billion dollars, and then claim I own $100 billion in assets. But if I earn $25,000 and my expenses are $35,000, I'm still broke.

> [SS] has massive assets

Those "massive assets" are T-bills.

If push comes to shove, who do you think will get shafted - SS or China?

More to the point - how much are you personally willing to pay to maintain the SS benefits for folks 10-20 years older than you? How much do you think that folks who are 10-20 years younger than you are willing to pay to maintain your SS benefits?

What happens if we put it all into the stock market and the baby boomers retire?

I really don't want to see a stock market that has 3x the money coming out as is coming in.

The stock market is ownership of various kinds of assets. The demand for those assets will change. However, it is world-wide. And, there are income producing assets. Folks are saying "I'd rather have an iPad than $400 even though I know that that ipad costs only $35 to make".

T bills are a claim on future US tax revenue. That's very different.

You didn't even begin to address my question, you just threw out a bunch of hand-wavey silliness about how "ownership" and "assets" makes everything ok.

What happens to the prices of those assets when the baby boomers retire and are pulling out more money than there are young workers putting in? You have the same problems as SS. What if we had all of that SS money in the market? It'd be a disaster.

The whole world didn't have a baby boom at the same time.

WRT companies that produce stuff, the critical time is not when boomers retire, it's when they stop spending money. Fortunately, many will stop when they die, which reduces demand and the "load" on both the stock market and SS. Again, the whole world thing is relevant.

And, since boomer spending is income for later generations....

Do you really think that money invested in the stock market is like SS obligations? (Here's another difference - Congress can repeal SS whenever it feels like it.)

That's not at all true. Social Security's issues are massively exaggerated by certain groups. The real problems with regards to our "entitlements" is in Medicare. Unless the price of healthcare can be kept under wraps its going to be a nightmare. But there's too many people out there with a lot of money that don't want to see that problem dealt with.

Suggest you google "Is Social Security Bankrupt" and review the governments own projections. SS receipts are at parity or below obligations. It is, therefore, bankrupt and only maintained by the federal governments ability to run infinite* deficits.

(*) Infinite, that is, until the Chinese and other foreign nations stop purchasing our debt.

The Social Security trust fund has begun selling off it's very large supply of government bonds. This is exactly why the trust fund accumulated these assets. If a person or private pension fund accumulated a large supply of bonds in order to meet their obligations, it would be very odd to describe them as "bankrupt". Indeed, if I had enough bonds and income to meet my obligations for decades to come, I might well describe myself as being in possession of "fuck you money"

Going forward, in general, the Federal Government will not be able to rely on the Social Security Trust fund purchasing the bonds it issues. It can cut spending, raise taxes, or find other buyers who want to purchase bonds.

There is no particular reason to be concerned about the ability of the Social Security system, for years to come, to support it's obligations to the workers who have paid into the system. Unless, of course, you fear that wealthy elites will manufacture a bogus social security "crisis" to dispossess the savings of workers and continue to enjoy (federal spending/tax cuts) that can not otherwise be sustained.

You're living in a fantasy world: http://money.cnn.com/2010/02/02/news/economy/social_security...

I'm amused how the snarky, content-free comment critical of Bush gets upvoted, while this snarky yet entirely correct response is downvoted.

I think some people here don't grasp the seriousness of the US government's financial situation, and how much it worsens the longer the recent status quo is maintained.

The Bush comment wasn't to criticize the president, just distinguish it from the Clinton-era proposal that said the same thing but didn't capture the public debate like the proposal in 2001-2002 did.