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Forum Post: The Obvious Solution to Our Social Security Problem

Posted 2 years ago on April 15, 2012, 8:40 p.m. EST by flip (7095)
This content is user submitted and not an official statement

Guaranteeing America's working people a decent retirement has become increasingly difficult with the decline of traditional pension plans and the glaring inadequacy of the 401 (k) savings accounts that have replaced them.

So what to do? The answer is obvious to the AFL-CIO, and should be to everyone else: Increase Social Security benefits.

As AFL-CIO President Richard Trumka notes, "Social Security is a phenomenally successful program that represents the very best in American values and has virtually no waste, no corruption and almost no overhead."

The program does have one serious problem, however – "its benefits are too low."

Trumka certainly has that right. The average Social Security payout for men is only about $16,000 a year, barely above the minimum wage. Payouts for women average only about $12,000 a year, barely above the poverty line.

Most of those drawing benefits earned much more during their working days. The retirement programs in most other industrialized countries pay retirees benefits in amounts far closer to what they made while working.

It's for a very good reason that the AFL-CIO has taken an official position calling for "an across the board increase in Social Security benefits," including adjustments to account for retirees' steadily escalating health care costs and, among other economic setbacks, "the loss of home equity experienced by millions of Americans in the Great Recession."

Remedial action is clearly needed. As the AFL-CIO says, "Our retirement system is falling apart at the seams. Millions of Americans are afraid to retire because they know they can't maintain their standard of living in retirement, and more and more seniors have to keep working well past the age when they should be retiring."

Democratic Senator Tom Harkin of Iowa, who calls Social Security "the most successful program in history," has introduced a bill – the Rebuild America Act – that includes changes in the program such as the AFL-CIO is advocating.

Harkin's bill would increase benefits by about $60-$70 a month and guarantee that the trust fund from which benefits are drawn would remain solvent and able to pay out full benefits for at least another 40 years, in large part by removing the $110,100 cap on income subject to Social Security deductions.

Quite a contrast to what's been discussed in Washington, where most of the talk about Social Security has been about Republican proposals to cut benefits. That has especially included increasing the retirement age and cutting back cost-of-living adjustments.

Harkin's measure would not only revitalize the Social Security system. It also calls for modernizing transportation and energy infrastructures and education systems, increasing access to quality child care, expanding time-and-a-half overtime pay, raising the minimum wage, increasing the availability of paid sick leave, expanding union rights and increasing opportunities for disabled workers. The bill also would end tax breaks for companies that ship jobs overseas.

Increasing Social Security benefits remains a top priority with Harkin and other Democrats. As the AFL-CIO sees it, "the overwhelming majority of working Americans of every political persuasion in every part of the country 'get' the absolutely critical importance of adequate Social Security benefits, but our elites don't seem to get it. Social security is the solution, not the problem."

Dick Meister is a San Francisco-based writer who has covered labor and politics for more than a half-century as a reporter, editor, author and commentator. Contact him through his website, dickmeister.com.

85 Comments

85 Comments


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[-] 2 points by cJessgo (729) from Port Jervis, PA 2 years ago

Problem is Wall street must have that Money.Now people will say it does not belong to them. Well this is true but it has never stoped them in the past.And you can hear foolish cries we are broke.Wall street gets what Wall st wants.And it has had it's eye on the American people's trust fund for a very long time.This Blurb has been brought to you buy Goldman Sacs

[-] 2 points by flip (7095) 2 years ago

just like all those 401k fees they have been getting for the past 30 years or more - the political system is corrupted by money!

[-] 1 points by cJessgo (729) from Port Jervis, PA 2 years ago

yep

[-] 2 points by shoozTroll (17632) 2 years ago

Yes! Remove the cap.

I've been saying this for while. It would likely fund it in perpetuity.

[-] 1 points by Pequod (17) 2 years ago

Removing he cap would entitled those who paid in more to receive more. How would that help?

[-] 2 points by shoozTroll (17632) 2 years ago

Not necessarily. It's insurance, not a pension.

Benefit caps could be written in when the cap is lifted.

I know the greedy fucks think they are entitled to so much more than everyone else, but should they always get their way?

[-] -1 points by Pequod (17) 2 years ago

Social security would have to be re chartered. It was specifically designed not to be welfare. The cap wasnt there to reduce the amount rich people would have to pay, but to limit the amount they could collect. Remember that. Unlimited contributions would lead to unlimited benefits.

[-] 2 points by shoozTroll (17632) 2 years ago

Then recharter it. It's retirement insurance not welfare anyway.

I've paid higher taxes than people making less than me all my life, it never bothered me.

Why is it these rich fucks feel so entitled?

[-] 1 points by Pequod (17) 2 years ago

As retirement insurance, higher contributions would lead to higher benefits. Its original mandate was to avoid looking like welfare. People forget that.

[-] 2 points by shoozTroll (17632) 2 years ago

These days, I don't care what it looks like.

It needs to be fixed and this is a way to fix it.

Care to answer my question?

[-] 0 points by Pequod (17) 2 years ago

i cant answer, you need to ask them.

[-] 2 points by shoozTroll (17632) 2 years ago

I don't know any of them.

So why then do you think, they feel so entitled?

As insurance, it would be doled out according to need. Hell, they wrote that rule, That's how insurance works.

If you pay high costs for full coverage on a BMW, you don't get a refund, if you never wreck it.

[-] 0 points by Pequod (17) 2 years ago

For clarification neither insurance OR pensions are doled out for need. Both are linked to either the contribution you made, pension, or the premiums you paid, insurance. I think you are inaccurate about insurance and how it works.

[-] 2 points by shoozTroll (17632) 2 years ago

OK, I'm going to say this just one more time, although I know how mush(sic) (R)epelican'ts like to repeat themselves. I don't.

My God, how you people repeat yourselves, I do believe I've had this conversation before. Was it a different iteration of you???

So know this and don't ask or insinuate again.

I don't care what they call it! FLAKESnews can call the nastiest thing they can get away with. Glenn Beck can call it satans calling card,. and you know they will. I don't care.

Remove to cap, to fix it.

It's simple. All the rules can be re written. They rewrite them against us all the time, at the behest of ALEC, and any number of similar entities.

What the hells wrong with rewriting something in a way that's good for all the rest of us?

If only just to equal out all the BAD legislation they've written.

[-] 0 points by me2 (534) 2 years ago

Why should workers' wages fund social security at all? It's counter productive.

[-] 1 points by shoozTroll (17632) 2 years ago

Actually, you are correct.

http://pragcap.com/understand-the-modern-monetary-system/understanding-modern-monetary-system

But, until we adopt this system, you are incorrect.

[-] 0 points by Pequod (17) 2 years ago

Every self employed person will vote against raising the cap. If you are self employed, this would amount to a 13% tax increase. Most self employed people do not consider themselves filthy rich. Your local dentist, making maybe $200000 and employing 8 staff members is doing ok but he isnt going to sit lightly and take a $13000 paycut and have his benefits capped.

You seem very angry, which usually stems from deep frustration. Work within the system and you might get results.

[-] 0 points by shoozTroll (17632) 2 years ago

I'm not angry, just frustrated with your inability to understand that all of these things could be dealt with upon lifting the cap.

I'm sure you could find an excuse to just repeal the whole thing, as that appears to be the direction you are trying to steer this.

If your only concern in life is to maximize your own monetary ROI, you are in a sorry state anyway.

How in the hell can you possibly work in a system created by agents like ALEC?

The other frustrating part, is that you didn't address anything I actually said. You just inserted something off subject.

[-] 0 points by Pequod (17) 2 years ago

And I replied lifting the cap has consequnces for people who dont consider themselves rich. I did answer you.

Everyone should strive to maximize their ROI as long as its legal. Your statement makes no sense.

Tearing down a system that has worked well since 1776 makes no sense, and since it is the system with which I am presented, its the system within which I will work. I like order, not chaos. That suits me best. Others may be better suited for a chaotic life. There are outlets for that, also.

[-] 0 points by Pequod (17) 2 years ago

I would raise the payroll tax and raise the retirment age.

[-] 0 points by shoozTroll (17632) 2 years ago

Whatever. You've offered nothing, but status quo and refused to admit that anything at all will help.

So what's your cure for the SS dilemma, real of imagined?

[-] 0 points by francismjenkins (3713) 2 years ago

Retirement isn't insurance, it's a pension (and I don't care how it was originally formulated or defined). We shouldn't be forever stuck with how our ancestors defined things.

[-] 2 points by flip (7095) 2 years ago

this is the richest country in the world - lots and lots of money - where is it?

[-] 1 points by SparkyJP (1646) from Westminster, MD 2 years ago

Being the richest country in the world is why we attracted a Kleptocracy (our present form of government).

Kleptocracy, alternatively cleptocracy or kleptarchy, (from Greek: κλέπτης - kleptēs, "thief"[1] and κράτος - kratos, "power, rule",[2] hence "rule by thieves") is a form of political and government corruption where the government exists to increase the personal wealth and political power of its officials and the ruling class at the expense of the wider population, often without pretense of honest service. This type of government corruption is often achieved by the embezzlement of state funds.

No sense robbing a poor country.

[-] 1 points by flip (7095) 2 years ago

while true not very much on point - have you followed the conversation

[-] 0 points by craigdangit (326) 2 years ago

Citation please.

[-] 2 points by craigdangit (326) 2 years ago

Ah, yes, yet another problem with this board. Asking for a citation should never be considered offensive, or improper, if anyone even remotely cares about the truth. Too many here don't, they just want to be on the winning side.

[-] 1 points by flip (7095) 2 years ago

you need a citation that this is the richest country the world has ever seen?? i don't really think that is necessary do you - which country (empire) would you put up - britian 1925 - rome 300ad - maybe the old soviet union

[-] 1 points by craigdangit (326) 2 years ago

Of course I do. I try not to take anything at face value. Too much "accepted fact" is just another distortion.

Alright, fine, I will look it up myself.

Going per total GDP you could say we are, but this figure does not really reflect "wealthiness" the way GDP per capita does. And even if it did, the European union beats us.

GDP per capita is a more important bellweather, because if money is to be redistributed from the rich to the poor, the amount of money available needs to reflect the number of people it will be distributed across.

By this figure, we are number seven. http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita

[-] 1 points by flip (7095) 2 years ago

. http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita - this gets me nowhere but is this really what you want to debate - that maybe switzerland or some little shit country is richer than the usa - can't be

[-] 1 points by craigdangit (326) 2 years ago

Okay, so we're the second richest then, behind the EU.

This is silly. Political boundaries are arbitrary and useless. If all of Europe joined together, they would be many times "richer" than the US by your measurement of total GDP, even though nothing would change terms of average incomes.

That is where GDP per capita comes into play. If the US split into two countries, would that mean we are not the richest country any more by your measurement?

Besides, even among the countries with higher GDP per capita, many of them have much lower public debt than we do as a percentage of GDP. Qatar's public debt is actually FALLING, imagine that. Less than 10% of GDP.

[-] 1 points by flip (7095) 2 years ago

this is your response to - this is the richest country in the world - lots and lots of money - where is it? - well all of europe is not joined together - and qatar - seriously - the point stands - we are rich beyond compare - lots of money everywhere. mostly in the pockets of corporations and the rich

[-] 1 points by craigdangit (326) 2 years ago

Not really. Qatar is in much better economic shape, due to the fact that their moron politicians haven't run them into debt up to their eyeballs.

The US isn't joined together, either, any more than the EU is. The constitutional relationship between the federal government and the states is not really all that different from the relationship between the EU and its member countries. In the constitution, the states were to be taxed to provide wealth for the federal government, which is supposed to do little more than print money and run the military and the courts.

So just as I said before, GDP per capita is more important than total GDP, in terms of how able the population of a country is to help its poor. Think about it.

Where is this theoretical wealth going? Back to the poor of the country, in the examples we are discussing. Therefore, Qatar is much much more able to help its poor people than we are.

[-] 1 points by flip (7095) 2 years ago

The US isn't joined together, either, any more than the EU is. - complete nonsense - don't you pay attention to the news - don't you know why the greek crisis may break up the euro. silly conversation. we won ww2 on the basis of our industrial might - gdp is an economic fiction in many ways. industrial base, resources even access to water is a better way to measure the wealth of a country but count the trillions in offshore accounts, then the trillions in corporate accounts and then the trillions in the pockets of the .1% - go ahead - send me the numbers then tell me about qatar.

[-] 1 points by craigdangit (326) 2 years ago

You've got to be kidding.

What do you plan to do about money in offshore accounts? Attack the countries holding it?

Yes, count up all those trillions and subtract the national debt. Do that, I dare you.

[-] 7 points by flip (7095) 2 years ago

we have a printing press - the debt is not a problem - it is only a problem for poor countries that must pay the mafia don - it is never a problem for the don. as to off shore money it is simple - if your corporation wants to do business in this country then you pay for that right. haven't you noticed that we are the richest most powerful country in the world - nobody can mess with us so we are in a very good position to collect money or do whatever we want. this all started with you disputing that we are the richest country the world has ever seen - keep believing what you like - qatar or monte carlo is richer that the usa - if that is really what you think it's ok - the moon is made of green cheese also

[-] 2 points by craigdangit (326) 2 years ago

We have a printing press.

Sigh

[-] 3 points by geo (2638) from Concord, NC 2 years ago

+1

The printing press only ensures that we will never become insolvent or bankrupt... it does not create wealth as flip may think, only productivity creates wealth.

[-] 1 points by flip (7095) 2 years ago

don't sigh - educate yourself - it is not that hard - we owe the chinese (and the world) money - and how will we pay them in electronic dollars or barrels of oil - can you guess? and if we don't pay them - what will they do - sigh? you are a fool

[-] 1 points by Puzzlin (2898) 2 years ago

So many are so brainwashed with myths about Social Security that this rationale sounds completely off the hook for them. Sadly, it's the truth, but they can't sense it enough to even bother to check it out. One can be assisted to the truth by motivation and then look at the problem objectively leaving the emotions out where the belong when one quests for what's true. So many are cut off from knowing the truth about SS, except when that motivation strikes hard and quick, like for those folks over 40. The closer you are to when you "should" and would "like" to retire you'll sense that skin you have in the game of do I retire richly or do I retire poorly. Suddenly it will be more than an interesting topic to debate. Suddenly the rich balancing their checkbooks off your food for survival will take on a significant meaning.

Let me clear the air. Social Security MUST be funded and we should look at increases to make it viable for those who will inevitably NEED it. Social Security makes our country better and stronger. We need to stand united and have compassion for each other. Wars are wastes if you want to rid the world of these I stand with you. Anyone who wants to take the last vestige of any kind of dream away from any American has no heart and must despise certain types of people which makes them Judge, Jury, and Executioner. Heartless people truly do not care about anyone but their own. Only. From the heartless comes the haters. Unfortunately, we do know them, and we should because they need to watched and muzzled.

For those who call for abolishing Social Security like the Tea Partiers, and many in the GOP, remember Rick Perry? They outright want it gone. Their solidly with the "gut it and let it bleed out" crowd. It will come in the guise that their actually fixing it by beating it down. It's like the Mitt Romney shell game. And then poof, it's gone, self fulfilling prophecy. So we told ya it was no good, and now it's gone, so it must have been no good. Mister Etch -a- Sketch can always make reason fit any rhyme, his truth is malleable.

The Puzzler

Good thread. We might get lucky and wake up one person.

[-] 1 points by Odin (583) 2 years ago

I agree that we should remove the cap of $110,100 on income subject to social security deductions. The other thing that will be key to our success is how we frame issues. For example: Do you think we should cut down on our military spending, and then shore up social security, and medicare?

[-] 1 points by flip (7095) 2 years ago

you are right - aircraft carriers are not making us secure

[-] 1 points by francismjenkins (3713) 2 years ago

The problem with social security is you don't accumulate anything. Technically, you don't even accrue a property interest in your monthly benefit, and upon death, your heirs get exactly nothing (unless you have a surviving dependent). Even a garden variety, very safe pension (that doesn't invest in anything crazy, just shit like municipal bonds, treasuries, annuities, and so on) leaves you with a nest egg you can pass to your heirs. So that would be my one complaint with social security. Of course privatizing it could only make it worse, but I think there's more than two choices in our vast universe.

[-] 3 points by flip (7095) 2 years ago

i am with you here - we are the richest country in the world - you would think we could get a good pension

[-] 1 points by DemandTheGoodLifeDotCom (3213) from New York, NY 2 years ago

Do you have any stats on that?

I just did some rough numbers. If you averaged $35k over 40 years and paid 10% of that into retirement and earned 4% on your bonds, you would have $345k.

That would pay you a $13k dividend if you just lived off the 4% (which would be difficult since rates fluctuate). If you paid yourself the full $385k over 25 years, that would also work out to $13k.

So you are not really getting a better deal with bonds and you are taking on risk. Bonds can drop in value, especially municipals.

If we just had a flat 10% pension tax on all income including interest income and retained earnings, instead of just the payroll tax, that would raise $1.5 trillion.

We have 40.5 million aged 65 and older. If we paid out that money equally, it would amount to $37k per year per senior.

[-] 1 points by francismjenkins (3713) 2 years ago

First, if workers had their own accounts, there is one obvious (and huge) benefit, even assuming your numbers are accurate (and they sound pretty good, except that average income is higher than $35K), you still wind up with a nest egg you can pass to your heirs. Yes, I acknowledge, we'd probably wind up with approximately the same (or very similar) monthly benefit, but (assuming retirees are required to draw from an annuity rather than withdraw from accumulated principle) you get a nest egg, wealth that can be passed through your estate.

Also, yes the market value of bonds does fluctuate, but that's only the spot price in the market on any given day. The face value of the bond (assuming the bond is retained for its entire period) doesn't change (nor does the interest rate promised at the time of sale). Moreover, different state bonds perform differently, and of course the social security administration would buy and sell these securities in a way calculated to maximize return (and this is not a high risk proposition). I mean, when's the last time a state defaulted on its obligations?

Nonetheless, I don't mind your pension tax idea, it sounds like a solid idea (I'm just saying social security should simply be managed like a pension fund, and right now it's not).

[-] 1 points by hchc (3297) from Tampa, FL 2 years ago

Ummm, we're broke dude.

[-] 4 points by alexrai (851) 2 years ago

Plenty to throw around at the military machine and prison industrial complex though...

Anyone need a few more F35 fighters?

[-] 1 points by tep22 (1) 2 years ago

The article above is full of math fail.

Social security is broken because it's a failed ponzi scheme set up by the economically illiterate.

Any program that earns no interest and is front loaded with bennies (first in first out) will eventually collapse and screw the last ones in. Bernie Madoff reinforced that... he learned his trade from the social insecurity program.

The FUGLY numbers: http://www.usdebtclock.org

[-] 1 points by hchc (3297) from Tampa, FL 2 years ago

Exactly. Anyone who thinks they are going to give the money to the SS fund instead of their wars, when the dollar is finally almost done, is insane.

Bombs over people is their way.

[-] 2 points by geo (2638) from Concord, NC 2 years ago

Don't believe the hype... the dollar is not almost done. It has been and is still the highest volume traded currency on the planet.

[-] 1 points by hchc (3297) from Tampa, FL 2 years ago

Of course it is highly traded. Everyone is afraid we will blow a hole in them if they stop.

But it hasnt stopped Russia and China from ditching it in trade. And more are following suit.

They are making the decision for war over the people everyday here. This isnt good.

[-] 1 points by geo (2638) from Concord, NC 2 years ago

The decision between Iran, Russian and China to drop the dollar wasn't an economic decision (a little bit because of the exchange rate advantages of not trading Iranian oil using the dollar) but a highly political decision.

[-] 1 points by hchc (3297) from Tampa, FL 2 years ago

Yes, seems how they laughed in the face of Britton Woods.

There was a guy that said first you get currency wars (been going one), then you get trade wars (which are starting to heat up) and then you get real wars.

[-] 2 points by Puzzlin (2898) 2 years ago

No, we're not dude.

Ever take take a loan dude? Buy a house?

Dude, do you understand finances?

How many times in the history of this country have we run a deficit? Do you know? Have to look it up?

The Puzzler

[-] 0 points by hchc (3297) from Tampa, FL 2 years ago

We are in unique times right now, with both inflation and deflation happening, and a new global economy.

The writing is on the wall. I guess it depends on what your definition of broke is. Mine is GDP/Debt ratio.

[-] 2 points by geo (2638) from Concord, NC 2 years ago

Not broke at all... but getting close to our limit to print money before it becomes a real negative effect to the dollar.

[-] 1 points by extroll (47) 2 years ago

Before it becomes a negative effect? We're hemorrhaging purchasing power. And yes, the country is broke. Have you seen the kind of debt we are in?

[-] 2 points by geo (2638) from Concord, NC 2 years ago

We have always been in debt without the ability to pay it off.... almost always, there was one time during Andrew Jacksons term for about 6 months the debt was zero, but that was it. Whether it was $500 Billion or $25 Trillion we weren't paying it off.

What matters is whether we can meet the interest payments on the treasurys that were sold. And the answer is yes we can.

[-] 1 points by extroll (47) 2 years ago

I said the kind of debt. Our interest bearing debt is close to 100% of GDP. Not good. So what if we can make interest payments, we are borrowing the money to pay the interest also. If other countries decide they don't want to invest anymore (Likely, and paradoxically, because we have so high of a debt to income ratio), we will be forced to float our nations payday loans at a higher interest rate, causing snowball.

[-] 1 points by geo (2638) from Concord, NC 2 years ago

'Our interest bearing debt is close to 100% of GDP.'

There is a huge productivity gap with a large portion of the population underemployed plus our unemployment, which gives us a lot more headroom then just straight GDP numbers.

I am not a fan of QE. Monetizing our debt is bad policy, and the source of our perceived tightness. Our short term higher rate treasury's have recently been 'refinanced' into mid term and long term treasury's. The kicker is we don't have to sell treasury's to finance the deficit... this is done to keep the bond market chugging. By doing so, the Fed Resv is choosing a middle road to keep business happy and deal with the deficit. IMO its wrong.

[-] -1 points by extroll (47) 2 years ago

It's heading for disaster. You should talk to Shooz, he says we can just print anything we want to cover debt.

[-] 1 points by geo (2638) from Concord, NC 2 years ago

Modern Monetary Theory... he is correct. Classical Liberal macroeconomics doesn't deal well with a fiat monetary system... the system we have had for better or worse, since Nixon closed the Gold Window in 1971.

MMT deals strictly with the rules of fiat currency, which might seem counter intuitive to those not familiar with it. Debt is not the same as debt encountered in a gold backed system.

Rule 1: A nation that creates its own sovereign currency can not become insolvent.

[-] 1 points by DKAtoday (26179) from Coon Rapids, MN 2 years ago

Though it can experience hyper inflation. Any one have a wheelbarrow I can borrow I need to take some money to the store for a loaf of bread.

Think I'm kidding ? It has happened before. Look into Hyper inflation - instances of.

[-] 1 points by geo (2638) from Concord, NC 2 years ago

In 1945 our spending vs. GDP was 125%, in 1946 the war ended, millions of military men came home, industry downshifted off the war footing, and there was no hyperinflation. And we had a fiat monetary system with massive federal spending to finance the war.

[-] 1 points by DKAtoday (26179) from Coon Rapids, MN 2 years ago

Don't know why that would cause hyper inflation. Hyper inflation is due to the devaluation of currency - example:

You have 100,000,000 dollars worth of gold but you print 100,000,000,000 dollars in bills - notes of mark - denero. Anyway it gets out that you have done this so your creditors decide they do not like or trust that.

What do they do?

They divide the artificial money ( printed notes ) by the actual amount of gold you have on hand then instead of charging you a dollar for a loaf of bread they may want 100.00

Well you don't like the crimp that has put in your pocket so you decide that you need to print more cash to offset this distasteful turn of events and you print out another 100,000,000,000 dollars in bills. Well now you have twice as much ready cash on hand, You are feeling pretty good about yourself now boy - let me tell you.

But shit - I mean WTF - now the want a 1000.00 for that self same loaf of bread. Well this really chaps your ass and so you go back to the print shop.

Long story short the cycle to hyper inflation.

Anyone see how that might happen if someone started calling in our debts? You know like banks have been known to do to lenders when they may have been late or missed a payment?

[-] 1 points by geo (2638) from Concord, NC 2 years ago

WWII was the greatest example of Federal Spending that century. The government was buying goods with money they didn't have.... and consuming them, they weren't selling tanks and bullets to the Nazi's and Japanese.

There was no gold standard and money was printed as needed. Again, spending was 125% of GDP.... there was no hyperinflation. Our spending today isn't even that high.

Today we have no gold standard, so dividing up the notes printed and comparing it to the amount of gold we have on hand doesn't apply.

[-] 1 points by DKAtoday (26179) from Coon Rapids, MN 2 years ago

Ever hear of a war bond? Payable to bearer on maturity value of =

That is called pushing off payment until you can recoup.

They changed the standard. You can not have money if it is not tied to a standard - and any standard of value is subject to the same rules.

Have you ever had a basic economics course?

[-] 1 points by geo (2638) from Concord, NC 2 years ago

In a fiat monetary system the value of the dollar is tied to the GDP and employment. The currency is not commodity linked for value.

MMT is the macroeconomic theory that applies to fiat currency. And this is the system we have been working with for 40 years. Many people misunderstand this system and push policy and other ideas that work with commodity based currency, and it screws our economy up.

[-] 2 points by DKAtoday (26179) from Coon Rapids, MN 2 years ago

So you are saying essentially that being 15 or more trillion dollars in debt should not affect our currencies value? Is that what you are trying to say?

[-] 1 points by DKAtoday (26179) from Coon Rapids, MN 2 years ago

Also if tied to the GDP how is that affected by outsourced product manufacture? Has any one looked into that?

I mean we have such a huge number of people who were kicked to the curb by loss of employment due to the meltdown and it's system wide effects. There is also all of those failed businesses. All of those abandoned properties and failed mortgages and lost revenue from workers - actually reversed revenue due to unemployment insurance until they run out of benefits. I mean something in this mix in this mess has got to have a major impact on the value of currency.

[-] 1 points by shoozTroll (17632) 2 years ago

You and me see eye to eye on this one geo.

MMT should be adopted.

Here's another link.

http://bilbo.economicoutlook.net/blog/

[-] 0 points by extroll (47) 2 years ago

Then why do you say you are not a fan of QE?

[-] 3 points by geo (2638) from Concord, NC 2 years ago

Monetizing debt is plain stupid. We do not have to sell treasury's to finance deficits. We do not have to create interest on money that can be created by the government. Selling treasury's is solely to support the bond market. Granted many 401k's and other pension vehicles rely on bonds, so quite a few americans are effected by this market.

[-] 0 points by extroll (47) 2 years ago

It sounded like you were a fan of MMT/QE, so I was wondering what the conflict was.

[-] 1 points by geo (2638) from Concord, NC 2 years ago

I am a fan of MMT. MMT does not promote QE.

[-] 2 points by flip (7095) 2 years ago

this is the richest country in the world - lots and lots of money - where is it? tough queation but you can figure it out!

[-] 1 points by hchc (3297) from Tampa, FL 2 years ago

Its being used by rich assholes who dont give a shit about SS. Or they would end the wars and get their shit together.

Dont expect that to happen anytime soon. And if they have to, and they will, they will choose war over SS payments to seniors. Bet on it,

[-] 2 points by flip (7095) 2 years ago

possibly true - so you give up?

[-] 0 points by hchc (3297) from Tampa, FL 2 years ago

I prefer they just let me keep my cash.

Im much better with money than they are.

[-] 2 points by flip (7095) 2 years ago

sounds like you have not lived through the tech crash and the 2008 crash - or maybe you are one of those guys from the big short and made billions shorting housing. if you are so good at managing money can you help me out - where should i put it right now - cds, stocks (which ones) or maybe bonds - thanks

[-] 0 points by hchc (3297) from Tampa, FL 2 years ago

Hard Assets. Currently low income housing is a guaranteed 15-20% return. Other hard assets should be considered also. But there is no solution to objectively thinking for one's self.

[-] 1 points by flip (7095) 2 years ago

i have considered hard assets - have you considered deflation - seems to me to be a very real possibility. your hard assets could be worth much less. you do remember the housing bubble - is it done deflating? we are pretty diversified - gold and oil etc but these times are very unusual

[-] -2 points by Zombiefighter (-16) from Ione, CA 2 years ago

A big part of the problem is drug addicts, convicted criminals, and too many people who have never put anything into the system are drawing out of it. Retirement is one thing. Paying criminals is something else.

[-] 1 points by Puzzlin (2898) 2 years ago

Legalize drugs, we cut our prison population by 2/3. Portugal has done just this. The myth is if that happens then suddenly half the pop become dopers. But it's actually the opposite, the dopers dwindle in number. But hey who the hell cares about the facts. Just dismiss if it doesn't fit your narrative. Sorry to disrupt those sensitive wave patterns out there.

The Puzzler