Our budget crisis in "real" terms

[rbell]

The numbers are too big. Here's an example of what government would look like if it were family-sized yet had the same spending habits:

If the Federal government were scaled down to the size of the average US household, here’s what its finances would look like:

• The Federal government would earn $50,000 a year in tax revenue (the same as the average US household).

• It would be $325,000 in debt.

• It would pay almost $10,000 a year in interest on that debt.

• Last year, it would have spent $79,000.

• This year, it is hoping to spend $86,000.

• The $100 billion in spending cuts (that some politicians view as draconian) would be equivalent to the household cutting its $86,000 in planned spending down to a mere $83,700. Not a bad start, but the household has another $33,700 to go before it balances its budget.

Wow.

SOURCE

 

[InTheLight]

Thanks for the post. This spending problem is the number one political/economic problem facing our nation.

I'm passing this along to peeps in my email rotation.

 

[rbell]

It will take a truly courageous leader to tackle the sacred cows of entitlement spending.

 

[glfredrick]

It will take a truly courageous leader to tackle the sacred cows of entitlement spending.

And that leader had better get it right on the first try, for they won't get another chance for at least one 4-year cycle.

We've not even begun to see the true spending that has been thrust upon us by the current administration. Most of the bills they have signed into law are also set to begin after the next presidential term. That will make the next president look fairly idiotic as he (or she) tries to manage a government out of control and virtually bankrupt. it is almost as if the current administration knows that they will loose the upcoming election -- and has planned on purpose how to solidify their Marxist agenda after that.

I'd chuckle at our President's promises (we will balance the budget in 16 years... etc.) if they were not so completely falsified as to cause me to weep instead...

 

[carpro]

We've not even begun to see the true spending that has been thrust upon us by the current administration. Most of the bills they have signed into law are also set to begin after the next presidential term. That will make the next president look fairly idiotic as he (or she) tries to manage a government out of control and virtually bankrupt. it is almost as if the current administration knows that they will loose the upcoming election -- and has planned on purpose how to solidify their Marxist agenda after that.

Good point. It's a shell game.

Obamacare, for instance, will cost $ 7.6 trillion over 10 years, but almost nothing this year.

 

[freeatlast]

The numbers are too big. Here's an example of what government would look like if it were family-sized yet had the same spending habits:





If the Federal government were scaled down to the size of the average US household, here’s what its finances would look like:

• The Federal government would earn $50,000 a year in tax revenue (the same as the average US household).

• It would be $325,000 in debt.

• It would pay almost $10,000 a year in interest on that debt.

• Last year, it would have spent $79,000.

• This year, it is hoping to spend $86,000.

• The $100 billion in spending cuts (that some politicians view as draconian) would be equivalent to the household cutting its $86,000 in planned spending down to a mere $83,700. Not a bad start, but the household has another $33,700 to go before it balances its budget.

Wow.

SOURCE

While your assessment is nice the problem is much worse. I really do not believe that the debt is fixable any more. I believe that we will go under as a nation in the near future. That will depend on how long other nations are willing to hold onto our debt before they cash in.
First we are over 14 trillion dollars in debt. One trillion is a million dollars a day, every day, for 2739 years. We are 14 times that in debt. That debt is growing at the rate of 4 billion a day. That is 4 thousand one million dollars bills a day every day deeper in debt. The government is currently borrowing over 30% of every dollar they spend. The president has just proposed a 3.7 trillion annual budget.
By the way. Social security is not part of the federal budget debt. it has its own fund and has a surplus of 2.6 trillion and can continue to pay at the current rate without going in the read for another 26 years. By then the baby boomers will be dying off and no new SS taxes needed.
However the politicians are claiming that Social security is a problem. The reason they are claiming that is so they can reduce the pay out and rob the system to try and cover their wasteful spending. They want that 2.6 trillion.

 

[carpro]

By the way. Social security is not part of the federal budget debt. it has its own fund and has a surplus of 2.6 trillion and can continue to pay at the current rate without going in the read for another 26 years. By then the baby boomers will be dying off and no new SS taxes needed.

I'm speechless!

How completely ignorant can any one person be?

 

[FR7 Baptist]

By the way. Social security is not part of the federal budget debt. it has its own fund and has a surplus of 2.6 trillion and can continue to pay at the current rate without going in the read for another 26 years. By then the baby boomers will be dying off and no new SS taxes needed.
However the politicians are claiming that Social security is a problem. The reason they are claiming that is so they can reduce the pay out and rob the system to try and cover their wasteful spending. They want that 2.6 trillion.
[/FONT]

It is true that the SS Trust Fund has $2.6 trillion in assets. However, those assets are Treasury bonds so the government has to pay SS back.

 

[freeatlast]

I'm speechless!

How completely ignorant can any one person be?

I don't know you well enough to judge that but if you read this you might know the answer better then me. While it is true that the fund is full of IOU's in the form of bonds, it is still the funds money and not the federal governments.
http://www.disabled-world.com/disability/social-security/usa/social-security-surplus.php

http://www.cbpp.org/cms/index.cfm?fa=view&id=3104

 

[freeatlast]

It is true that the SS Trust Fund has $2.6 trillion in assets. However, those assets are Treasury bonds so the government has to pay SS back.

it doesn't matter. it does not belong to the government. it belongs to the fund. The fund is solvent. What they are trying to do is get out of paying back what they robbed from the fund.

 

[carpro]

I don't know you well enough to judge that but if you read this you might know the answwer better then me. While it is true that the fund is full of IOU's it is still the funds money and not the federal governments.

There is no money. It's already been spent and the IOUs are worthless.

Surely you at least know that.

I'm still so flabbergasted at your ignorance that I can hardly breathe.

 

[freeatlast]

There is no money. It's already been spent and the IOUs are worthless.

Surely you at least know that.

I'm still so flabbergasted at your ignorance that I can hardly breathe.

I can understand you being flabbergasted, but please call 911 for your breathing. Your just not ready for such a traumatic experience. The fund is solvent. You simply do not understand economics, but that is fine you can't understand everything. It is even earning interest on the bonds. What the politicians do not want is for the fund to start cashing in the bonds. Let me make it a little simpler for you as I know you are experiencing difficulties with this. 2+2=4. Bond plus interest equals more then bond face value.
Now stay with me. I know this is difficult but with some help you can get through it. Have you called 911 Yet? As they cash in the bonds they can use the money along with the money being paid in currently and all is fine with the fund. This is not adding to the debt because the fund is not solvent because the fund is solvent.. This is the federal Government meeting their obligation from past deals. Now we will get a little deeper so you might want to wait until they give you some oxygen.
One of the problems with added expenses to the SS system is the baby boomers. Let me know if that is a new term for you and I will explain. Within the next twenty or thirty years they will all be gone and the fund will remain solvent because of the bonds with interest, and because there will be more people paying into the fund then what is being paid out.
I realize this is all difficult, but think of it this way. You can now take a deep breath and relax and carry on an intelligent conversation with your neighbors without being embarrassed on this subject.
Oh by the way. I seriously doubt that we make it twenty years as a default is much closer then that, but you just lay down and take it easy and let that oxygen do its stuff and don't fret as our government leaders are in control and SS is in the black.

 

[carpro]

The fund is solvent.

One can't fix what you've got and I won't even try.

 

[shodan]

Trillions in Debt

Most people probably have no grasp of "Trillion"

If 1 Million Dollars in hundred dollar bills weighs 22 pounds,

then 1 Trillion Dollars in those bills weighs 22 Million pounds

 

[Ruiz]

I can understand you being flabbergasted, but please call 911 for your breathing. Your just not ready for such a traumatic experience. The fund is solvent. You simply do not understand economics, but that is fine you can't understand everything. It is even earning interest on the bonds. What the politicians do not want is for the fund to start cashing in the bonds. Let me make it a little simpler for you as I know you are experiencing difficulties with this. 2+2=4. Bond plus interest equals more then bond face value.
Now stay with me. I know this is difficult but with some help you can get through it. Have you called 911 Yet? As they cash in the bonds they can use the money along with the money being paid in currently and all is fine with the fund. This is not adding to the debt because the fund is not solvent because the fund is solvent.. This is the federal Government meeting their obligation from past deals. Now we will get a little deeper so you might want to wait until they give you some oxygen.
One of the problems with added expenses to the SS system is the baby boomers. Let me know if that is a new term for you and I will explain. Within the next twenty or thirty years they will all be gone and the fund will remain solvent because of the bonds with interest, and because there will be more people paying into the fund then what is being paid out.
I realize this is all difficult, but think of it this way. You can now take a deep breath and relax and carry on an intelligent conversation with your neighbors without being embarrassed on this subject.
Oh by the way. I seriously doubt that we make it twenty years as a default is much closer then that, but you just lay down and take it easy and let that oxygen do its stuff and don't fret as our government leaders are in control and SS is in the black.

I know economics, and I do not think the fund is solvent.

Social Security will spend $7.7 trillion more than we will take in within the next 75 years. While we can cover the benefits of people for the next few years, the actuarial science sees it going negative. Economists Beach and Tyrell say that we will run out of money by 2015. This is proven by the decreased number of people paying into the taxes, the increased age of Americans, and the expected increase in the number of people expecting to get retirement.

Even at that rate, while social security is a part of the budget, the budget is not doing well. Our overspending in other parts of the budget has dramatic implications on this area as well.

 

[targus]

As they cash in the bonds they can use the money along with the money being paid in currently and all is fine with the fund.

As they cash in the bonds?

Where is the federal government - that is currently borrowing 40 cents of every dollar that it spends - going to get the cash to pay off on the bonds as they are cashed in by the SSI fund?

Your lack of knowlege here is beyond belief.

 

[carpro]

As they cash in the bonds?

Where is the federal government - that is currently borrowing 40 cents of every dollar that it spends - going to get the cash to pay off on the bonds as they are cashed in by the SSI fund?

Your lack of knowlege here is beyond belief.

Print it or borrow it, just like they did to cover the bonds they had to redeem last year and will again thisd year. Borrowing money to pay back borrowed money is a recipe for disaster on every level.

Solvent is not a word to describe any person , business, or government that does so. But the government does, at least, have printing presses no one else has, as we've already discovered. Another recipe for disaster.

 

[freeatlast]

As they cash in the bonds?

Where is the federal government - that is currently borrowing 40 cents of every dollar that it spends - going to get the cash to pay off on the bonds as they are cashed in by the SSI fund?

Your lack of knowlege here is beyond belief.

I understand your inability to believe, but that is all right because you can get you through this if you really try and think. I know it will be difficult, but i believe in you.
The issue was is the SS system broke. The answer is no. It is not. Now stop and take a deep breath because this must be real news to you and i do not want you to have to call 911 to be ventilated.
The current bonds held by SS are not adding to the debt. They are already figured in. Stay with me here. My government bonds are figured into the current debt figures. Only if I buy more am i adding to the debt. The same wit SS. They are not buying more because there is no extra money for the US government to seal from them as they are paying out every penny they get in.
This makes life for corrupt politicians uncomfortable because they cannot cover their irresponsible handling of the peoples money. So they are now lying to the public and claiming that SS is in the read, which it is not. The US government is in the read, not the SS fund. Stay with me now this is getting more difficult.
it is just like other countries hold bond debt for the US. The US knows that they cannot cut back on their payments and they cannot say that their bond holdings are in the red. That would cause a run on the US treasury. So instead the corrupt politicians are trying to pull the wool over the eyes of the public and blaming SS as part of the problem when the problem is with the spending, not SS which is in the black.
Do you have your resuscitation mask on? I don't want you to hyper ventilate. So the answer is not SS. The answer is for the politicians to stop their corrupt spending and cover ups and let SS continue to be in the black without any change. You can breath deep now and you can stop thinking again as I do not want to tax you.

 

[Earth Wind and Fire]

Budget cuts need to be applied on all levels. Federal, State & local. On a state level, look at wisconson. There asking teachers to pay what 12% of their healthcare. Whats the big deal. In the private sector you pay far more. They are striking for 3 days ....that means kids are home & parents have to take off work to care for them. So 3 days of no money plus Im paying these teachers entitlements.

In my state, New Jersey, Chris Christy our governor asked the teachers to pay 2% of their health care. The Teachers union went wild....how dare he. If I had the job as Governor I would say, If you dont like it we will fire you ALL & hire non union teachers & then do it if they dont knuckle under. No more mister nice guy.

 

[freeatlast]

I know economics, and I do not think the fund is solvent.

Social Security will spend $7.7 trillion more than we will take in within the next 75 years. While we can cover the benefits of people for the next few years, the actuarial science sees it going negative. Economists Beach and Tyrell say that we will run out of money by 2015. This is proven by the decreased number of people paying into the taxes, the increased age of Americans, and the expected increase in the number of people expecting to get retirement.

Even at that rate, while social security is a part of the budget, the budget is not doing well. Our overspending in other parts of the budget has dramatic implications on this area as well.

SS is a separate fund that has its own books. That is why it is holding bonds (IOU's) from the general fund. You have been listening to those politicians again. And wall street economics is not the same as this. Also no one is projecting 75 years down the line. next we are already out of money (US government) However the SS fund is in the black. SS is not the problem. The politicians are however. They have put the US government into a place where the government cannot get itself out so as any good politician and economist, you are an economist correct, will do is lie to those who they have scammed. Ever heard of Bernie Madoff? Now that was economics! is that what you are saying you know about?
Any way the SS fund is in the black, but because congress is in debt to it they do not want to pay up and are trying to get out of it by changing the system and cover their criminal activities with the fund.