Stuck In The Circle
- Nov 28, 2011
- Reaction score
- Political Leaning
sighOne problem if we default on payment of the debt, the SS system holds the largest amount of our debt....
Those intragovernmental holdings for SS are, again, just another smokescreen. As we draw more from the SS Trust Fund, those holdings will get smaller and smaller. There is also no chance whatsoever that the federal government will default on SS payments.
I already pointed that out. When the Trust Fund is depleted, we will have to cut benefits and/or raise taxes and/or use general tax revenues and/or borrow to pay benefits.we haven't had to use any of it to pay the benefits for people who are on it but that could change around in a few years then what do we do, cut benefits , raise the FICA tax
And hey guess what? We've been through this already. Reagan implemented taxes on Social Security income (which amounts to a significant benefit cut), increased payroll taxes a little bit, and bumped up the retirement age a little bit. All of that extended the solvency of SS, and surprise! it didn't cause the US economy to melt down.
Seriously, after 40 years of deficit hawks screaming about the evils of the debt, then doing nothing or increasing the debt, and not seeing any economic harms, and seeing harms when governments pursue austerity, I'm over it.