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Guest Post: Social Security Has A Real Problem

Tyler Durden's picture




 

Submitted by Lance Roberts of Street Talk Live,

The Social Security Administration made an alarming announcement recently that they will exhaust their funding capability by 2033 which was several years earlier than originally projected.   According to a recent article from Reuters"Unless Washington politicians, who have been at war with each other over government spending priorities and federal budget deficits, can decide how to put Social Security on a sound footing, retirees' pension checks would start running out in 2033, according to an annual report. 


The baby boomers - those 78 million Americans born between 1946 and 1964 - started retiring last year. With 10,000 of them expected to retire every day for the next 19 years, according to the Pew Research Center, they will increasingly strain Social Security." 

As millions of baby boomers approach retirement more strain is put on the fabric of the Social Security system.  The exact timing of this crunch is less important than its inevitability.  The problem that Social Security has is "real" employment.  I say "real" employment simply to sidestep the ongoing arguments about the validity of government employment survey's from the Bureau of Labor Statistics.  The question we want to know is if we are creating jobs and what types of jobs are we creating?  The answer to those questions tells us much about the strength of the underlying economy.

The Federal Government receives income from the Social Security "contribution" from employee's paychecks.  The chart above shows the annual levels of employment as reported by the BLS versus the receipts of social security contributions.  As you can see while there has been a negligible increase in the number of non-farm employees - social security "contributions" have decreased sharply by almost $70 billion from its peak.

This is due to two factors.  The first is that the number of "real" employees, while growing, is in lower income producing and temporary jobs. Since social security contributions are calculated as a percentage of income - lower income levels produce lower contributions.  We have written about this previously on the "real" employment situation.  However, in a recent interview Richard Yaramone spoke specifically to this issue stating "I'm fortunate enough to travel and speak to chambers of commerce with 300 to 500 people in the audience. They all tell me, 'Hey, listen, I am letting go of workers. I'm hiring them back at a fraction of what I used to pay them.  You hear from the other side, 'Hey, I finally got a job after two years of being unemployed. I used to make $100,000 (each year), now I'm making $45,000 or now I'm working part time.' Or (you hear), 'I used to make $500,000 and now I'm making $200,000 or making $125,000.'...."

Here is the key statement and something that we address often in regard to the NFIB survey's:  "So you are actually seeing this collapse, contracting on a real basis, of real disposable personal incomes. If you don't have the money, you can't facilitate expenditures. So that's the core of the problem. That's what's really going on in the US economy.  You don't listen to what all of these bigger numbers coming across the screen tell you. You talk to the people who are running the country. 99.7% of all employer firms in this country are small businesses. So when they speak, you have to listen."

The second factor is that a larger share of personal incomes is made up of government benefits which does not affect social security contributions. The chart tells the tale in this regard.  Since the financial collapse government support of personal incomes spiked from just over 25% of incomes to almost 35%.  This also does not include the 45 million plus Americans also collecting nutritional assistance, or "food stamps", from the government.  

The dependency upon government for financial support is a long term economic problem because it reduces economic prosperity.  However, the problem that Social Security faces is that the program's annual cash surplus continues to shrink due to lower receipts from working American's.  The problem for Social Security, and the U.S. in general, comes long before 2033.  In 2017 or 2018, just 5 to 7 short years from now, Social Security will begin paying out more in benefits than it receives in taxes.  It could come even sooner.   As the cash surplus is depleted, which is primarily government I.O.U.'s, Social Security will not be able to pay full benefits from its payroll and other tax revenues. It will then need to consume ever-growing amounts of general revenue dollars to meet its obligations--money that now pays for everything from environmental programs to highway construction to defense.  Eventually, either benefits will have to be slashed or the rest of the government will have to shrink to accommodate Social Security.

As millions of baby boomers begin to retire another problem emerges as well.  Demographic trends are fairly easy to forecast and predict.  (My friend Doug Short has done some excellent work in this area)  Each year from 2008, when those born in 1946 reach Social Security's early retirement age of 62, until 2025 we will see successive rounds of boomers reach the 62 year-old threshold.  There is a twofold problem caused by these successive crops of boomers heading into retirement.  The first is that each boomer has not produced enough children to replace themselves which leads to a decline in the number of taxpaying workers.  It takes about 25 years to grow a new taxpayer.  We can estimate, with surprising accuracy, how many people born in a particular year will live to reach retirement. The retirees of 2070 were all born in 2003, and we can see and count them today.

The second problem is the employment problem.  The decline in economic prosperity, that we have discussed extensively, caused by excessive debt, reduction in savings, declining income growth due to productivity increases and the shift from a manufacturing to service based society will continue to lead to lower levels of taxable incomes in the future.  Furthermore, with unemployment in the U.S. remaining stubbornly high, the longer that all-important 25-35 year old person remains unemployed the related loss in relevant job skills leads them to becoming unemployable.

This employment conundrum is critical.  Back in 1950, as the baby boom was just beginning to start, each retiree's benefit was divided among 16 workers. Taxes could be kept low. Today, that number has dropped to 3.3 workers per retiree, and by 2025, it will reach--and remain at--about two workers per retiree. Each married couple will have to pay, along with their own family's expenses, Social Security retirement benefits for one retiree. In order to pay promised benefits, either taxes of some kind must rise or other government services must be cut.  The chart shows this relationship between social benefits paid out in total (including social security, Medicaid, Medicare, etc.,) and the burden upon each non-farm employee.   Back in 1966 each employee shoulders $555 dollars of social benefits.  Today, each employee has to support $17,387 of benefits.  The trend is obviously unsustainable unless wages or employment begins to increase dramatically and based on current trends that seems highly unlikely.

The entire social support framework faces an inevitable conclusion and no amount of wishful thinking will change that.  The question is whether our elected leaders will start making the changes necessary sooner, while they can be done by choice, or later when they are forced upon us.

 

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Thu, 04/26/2012 - 18:24 | 2378397 fonzannoon
fonzannoon's picture

I love how the baby boomers started retring last year. I know tons that are 63 and retired at 53.

Thu, 04/26/2012 - 18:39 | 2378449 Tippoo Sultan
Tippoo Sultan's picture

Means testing will be a foregone conclusion, within one decade's time; of this you may be certain.

Thu, 04/26/2012 - 18:50 | 2378479 SilverTree
Thu, 04/26/2012 - 19:18 | 2378562 Paul451
Paul451's picture

But by the time congress gets around to implementing it, there wont be anyone left who could be excluded.

We'll all be destitute.

Thu, 04/26/2012 - 19:52 | 2378648 Bicycle Repairman
Bicycle Repairman's picture

"The Social Security Administration made an alarming announcement recently that they will exhaust their funding capability by 2033"

WRONG.  FAIL.  DOUCHE BAG.

Fri, 04/27/2012 - 12:57 | 2380524 Backspin
Backspin's picture

Down arrows?  Bicycle Repairman is correct.  They will not exhaust their funding capability by 2033, simply because they exhausted it long ago.

There is no social security trust fund.  There is no "lock box".  It was all spent long ago.  Now, there is only debt.

Thu, 04/26/2012 - 19:43 | 2378625 sessinpo
sessinpo's picture

Tippoo Sultan                           2378449

Means testing will be a foregone conclusion, within one decade's time; of this you may be certain.

 

Comment:

Take a step further. I agree with you testing will happen. At this point the foregone conclusion should be SS insolvency.

Fri, 04/27/2012 - 01:12 | 2379304 Harlequin001
Harlequin001's picture

I suspect that once the bond markets collapse the elderly and retired will be living with their children.

Thu, 04/26/2012 - 19:56 | 2378660 Bicycle Repairman
Bicycle Repairman's picture

Go ahead and means test people who have saved nothing and have no pension.  They will be collecting $12K-$20K a year and that will be their entire income.  You want to tax them?  Well, what do you think the tax will be on your $50K to $100K wage?

Thu, 04/26/2012 - 21:44 | 2378922 Bicycle Repairman
Bicycle Repairman's picture

To the people who downgraded me:  I'm sorry you didn't think it through.  It's a real bitch.

Fri, 04/27/2012 - 01:13 | 2379306 Harlequin001
Harlequin001's picture

Where will they get the $12-20K a year from?

The govt won't have any money...

Fri, 04/27/2012 - 08:04 | 2379621 Beam Me Up Scotty
Beam Me Up Scotty's picture

Sure it will. CTRL-P

Fri, 04/27/2012 - 08:04 | 2379622 Beam Me Up Scotty
Beam Me Up Scotty's picture

Sure it will. CTRL-P

Fri, 04/27/2012 - 08:38 | 2379684 greyghost
greyghost's picture

the u.s. goverment has all the money it wants. as sec. of the treasury i have this day ordered treasury employees to direct deposit all soc. sec. payments direct into all retires' checking accounts. these payments are created out of thin air, at a computor keyboard just like the federal reserve creates money out of thin air and at no cost. these payments will be considered a no cost solution to the generational ponzi scheme called soc. sec. payments into and by current workers to fund soc. sec. will continue ,however those reciepts will be used to pay down the debt of the united states. these actions are by executive order by the president of the united states and require no approval by congress.

Thu, 04/26/2012 - 21:38 | 2378909 Buck Johnson
Buck Johnson's picture

Bingo, they will mean test like crazy and make it a crime to hide assets while doing this for SS.  And heaven help the people getting disability via the SS, they may send you to federal prison aka "camps" for defrauding them if something doesn't fit.  Maybe this will explain why 450 million hollow point bullets where bought by the DHS (dept of homeland security). 

They may be getting ready for the inevitable cuts in benefits and such.

Thu, 04/26/2012 - 21:51 | 2378941 i-dog
i-dog's picture

... but ... but ... it was an "investment"! Those who put in will want it all back, plus interest. Those who didn't put [much] in will still want a full benefit (and will probably pass the "means" test, too)!

Thu, 04/26/2012 - 19:58 | 2378661 Cabreado
Cabreado's picture

The 53-year-olds could either a) afford it  b) thought they could afford it, or c) owe their future to the govt/public unions.

(b) and (c) are in for a surprise.

Fri, 04/27/2012 - 03:32 | 2379399 samlowrey
samlowrey's picture

I love it when an ill conceived government ponzi scheme clashes with its own faulty labor statistics.  It's like two morons meeting in the middle of a busy highway and getting run over!  Darwin at its finest!

Thu, 04/26/2012 - 18:26 | 2378402 A Lunatic
A Lunatic's picture

Just raise the age of eligibility to 87 1/2. See, all better..........

Thu, 04/26/2012 - 19:38 | 2378609 Born-Again Bankster
Born-Again Bankster's picture

No, no no.  You gotta think outside the box.  DECREASE the age to 50, but require anyone accepting benefits prior to 87.5 sign a life insurance policy payable to the US Gov in order to receive benefits.  They should be able to bundle those up, derivitive the shit out of them and get us at least another 10 years of prosperity before we have an "accidental" water poisoning at state-run nursing homes nationwide.   

Thu, 04/26/2012 - 20:17 | 2378713 bobert
bobert's picture

Gee I like the way you think!

Thu, 04/26/2012 - 19:58 | 2378662 Bicycle Repairman
Bicycle Repairman's picture

There are plenty of boomers whose "nut" is so large they can never retire.  They will continue to work, and contribute, until they drop.  Just like you.  Happy now?

Thu, 04/26/2012 - 23:32 | 2379157 Dre4dwolf
Dre4dwolf's picture

Just raise the age of eligibility to 90, and instill a mandatory age limit of 89....... problem solved.

At the age of 89, all men and women will be forced to fight to the death in the jungle on national television.

Thu, 04/26/2012 - 18:27 | 2378405 Conman
Conman's picture

Thats ok, they will just start deducting social security from social security payments.

Thu, 04/26/2012 - 18:39 | 2378448 lemonobrien
lemonobrien's picture

they already do, when you pay income tax.

Thu, 04/26/2012 - 18:45 | 2378462 Conman
Conman's picture

True in some cases it is taxable but that just goes to bailing out banks, food stamps, and keeping the postal service running. They need a direct way to keep ss running, They should just create a SIV for social security and have the fed buy it or give banks money to buy it.

Thu, 04/26/2012 - 20:19 | 2378720 bobert
bobert's picture

I'm voting for you and Born Again Bankster for congress.

 

Thu, 04/26/2012 - 18:28 | 2378410 UP Forester
UP Forester's picture

There's a problem with Social Security?

What, someone stole the 3-ring binder of IOUs from the filing cabinet?

Thu, 04/26/2012 - 20:00 | 2378668 Bicycle Repairman
Bicycle Repairman's picture

No, the political class doesn't want to be blamed for the coming debacle, so they are looking for a "divide and conquer" issue.  They want old fighting young.

Thu, 04/26/2012 - 20:41 | 2378773 WonderDawg
WonderDawg's picture

Doing it with race, as well, as can be seen by the Trayvon Martin charade.

Fri, 04/27/2012 - 14:03 | 2380676 TBT or not TBT
TBT or not TBT's picture

That would be mostly the race hustling party, the party of the Old South, of Jim Crow, of segregation, of the KKK, of violent resistance against civil rights movement.  

They converted over to the new racism a little while after losing the civil rights fight(their yes votes were embarrassingly low in both chambers of Congress), and converted the party of positive discrimination, race hustling, but changing anything on this note: 

they are now and have been since FDR's first race pandering in the FDR Depression, the party of identity politics.    

The NOT E Pluribus Unum party.

The In GOVERNMENT we trust party.

 

Fri, 04/27/2012 - 13:56 | 2380662 TBT or not TBT
TBT or not TBT's picture

Actually FDR predicted this outcome back when they were doing the calculations as to its viability, that someday, as soon as 1980 back when they did the math, the system would become a giant burden to the young.  

It already has been, as people on this site will understand, it has sucked out something like 13% of their potential wages throughout their careers, for most of them, and will not, cannot be paid back.  

It has gone to current expenditure all along.   Poof.    Worse than the spoof about Wall Street investing.

Fri, 04/27/2012 - 08:33 | 2379670 bingo was his name
bingo was his name's picture

I remeber a few year back watching some 60 minutes special (I think) on SS and they actually do keep all the bonds/ IOU's on paper in binders - none of it was electronic - fire in nondescript office building and trust fund goes bye bye

Fri, 04/27/2012 - 10:11 | 2380068 Bicycle Repairman
Bicycle Repairman's picture

Dude, everybody gets a report on their future benefits from the SSA every year.  I keep mine in a 3 ring binder in a fire proof vault.

Fri, 04/27/2012 - 13:57 | 2380665 TBT or not TBT
TBT or not TBT's picture

Those are...computer printouts...dude holy crap, did you think they hand typed that report?

Thu, 04/26/2012 - 18:30 | 2378421 buzzsaw99
buzzsaw99's picture

Since the financial collapse government support of personal incomes spiked from just over 25% of incomes to almost 35%.  This also does not include the 45 million plus Americans also collecting nutritional assistance, or "food stamps", from the government...

 

Now we know where the iphone money is coming from.

Thu, 04/26/2012 - 18:34 | 2378431 Dr Benway
Dr Benway's picture

Everyone, including the author of this post, assumes that there is some kind of "solution", some way to avoid the decline.

 

But perhaps all this is inevitable

Thu, 04/26/2012 - 19:15 | 2378548 vast-dom
vast-dom's picture

It's paging Dr. Benway with his rusty scalpel to fix the SS patient.

Thu, 04/26/2012 - 18:35 | 2378436 No One
No One's picture

"The entire social support framework faces an inevitable conclusion and no amount of wishful thinking will change that. "

 

but printing is more powerul than wishful thinking!!!

 

Thu, 04/26/2012 - 18:41 | 2378456 lemonobrien
lemonobrien's picture

i just want my money back; i want a lump sum pay out now. assholes.

Fri, 04/27/2012 - 09:52 | 2379998 Leraconteur
Leraconteur's picture

1) It's not 'my/your money', it never was.

2) You never 'paid in'.

3) You do not have 'an account'.

4) There is no money to get back to you in a lump sum

You were lied to.
It's a tax, there is no contract, you are entitled to nothing.

The money was spent within 2 weeks of your paycheck being cut. It went into the General Fund and paid for all of the government expenditures over your lifetime.

Thu, 04/26/2012 - 18:46 | 2378472 tajitj
tajitj's picture

Congrats baby boomers. Thanks for about 20% serving, but the other 80% have destroyed my future.

Thu, 04/26/2012 - 19:34 | 2378601 knightowl77
knightowl77's picture

I think it is closer to 5% having served......

Thu, 04/26/2012 - 20:02 | 2378677 Bicycle Repairman
Bicycle Repairman's picture

We've all served in the Social Security system.  Service of any other kind is completely irrelevant for the purposes of this discussion.

Thu, 04/26/2012 - 20:44 | 2378781 WonderDawg
WonderDawg's picture

Here's an idea for you: take responsibility for your own future rather than pre-emptively blaming someone else for your failure.

Thu, 04/26/2012 - 22:12 | 2378984 tarsubil
tarsubil's picture

Very true. Dad was visiting last weekend, just retired this year, and he was helping with fixing up the house. Little stuff, nothing major. He kept telling me really basic stuff until I finally said I'm a fucking doctor not a retard. He said he was sorry, he just wasn't around when I was younger to teach me any of this stuff (he abandoned the family before I can remember). I said it's okay, life isn't all parades and birthday parties. It was very touching almost like a Hallmark ad.

Just one of the many little ways I get to tell the powers that be to fuck off. You better believe they hate any type of reconciliation between generations.

Thu, 04/26/2012 - 18:53 | 2378490 Everybodys All ...
Everybodys All American's picture

Unbelievable that the author of this article does not discuss the payroll tax cut which funds the friggin system. Less money going in to the system. Gee, guess what happens? The insolvency date gets closer.

Fri, 04/27/2012 - 08:13 | 2379634 Beam Me Up Scotty
Beam Me Up Scotty's picture

It will go insolvent anyway. At least we can keep that 2% today. The people here know what to do with it. So don't look a gift horse in the mouth.

Thu, 04/26/2012 - 18:53 | 2378491 Rainman
Rainman's picture

Factor # 3 : Odrama dropped the payroll tax rate 2%, a taxpayer savings that transferred immediately to the oil cartel.

Thu, 04/26/2012 - 18:59 | 2378509 sangell
sangell's picture

No means testing. Cut benefits across the board and let the grasshoppers deal with it. We ants want our fair share!

Thu, 04/26/2012 - 19:48 | 2378641 sessinpo
sessinpo's picture

sangell                   2378509

Cut benefits across the board and let the grasshoppers deal with it. We ants want our fair share!

 

Comment:

I agree with you. Though I would say cut benefits to zero. The big question is, what is the cut off age. I know I have paid in and will probably never see a dime. Unfortunately, life isn't always fair. I would gladly give up what I have contributed if I could stop contributing right now and invest it myself with my own account that no one could touch (though I'm sure congress would tax me even more to death.)

Thu, 04/26/2012 - 20:05 | 2378689 Bicycle Repairman
Bicycle Repairman's picture

Hello.  We were ants, too.  We supported our parents/grasshoppers.  BTW who's tax dollars provided your K-12 education?  This ant.  Guess why we did it.

Thu, 04/26/2012 - 22:15 | 2378994 tarsubil
tarsubil's picture

I hate to break it to you but you got ripped off with a phony retirement fund and a phony educational system.

Fri, 04/27/2012 - 10:08 | 2380057 Bicycle Repairman
Bicycle Repairman's picture

Hate to break it to you, but the check will be in the mail.  The political class responds to the votes.  A large cohort of aged boomers have the votes. Every boomer I talk to liberal, conservative or confused all agree, rabidly, they're getting paid.  If there is anything that is clear about the future, it's that.  Only a complete systemic breakdown would change this.

 

Thu, 04/26/2012 - 19:01 | 2378517 Rubbish
Rubbish's picture

61 months to go and counting...keep working youngens. I have more doubt everyday I just won't make it. The landscape is turning brown.

Thu, 04/26/2012 - 19:05 | 2378524 Banksters
Banksters's picture

Who in the govt. do I sue for stealing my money?

Thu, 04/26/2012 - 19:15 | 2378546 Rainman
Rainman's picture

Franklin Roosevelt

Thu, 04/26/2012 - 19:16 | 2378551 Will To Live
Will To Live's picture

Dude, your fuct.

Thu, 04/26/2012 - 19:16 | 2378553 Winston Churchill
Winston Churchill's picture

Just return to the initial framework.

Retirement two years AFTER ave life expectancy.

No Medicare.

Problem solved.Politicians hanged.Twofer.

Thu, 04/26/2012 - 19:21 | 2378570 my puppy for prez
my puppy for prez's picture

We won't make it till 2033!

Thu, 04/26/2012 - 22:18 | 2379009 tarsubil
tarsubil's picture

Yeap. That prediction relies on all kinds of rosy scenarios. Even if SS goes tits up in 10 years instead of just falling short in 20, the dollar will probably collapse before that so it is a mute point.

Thu, 04/26/2012 - 19:23 | 2378576 in4mayshun
in4mayshun's picture

If the Gov is making these calculations for 2033, then it means SS will be bankrupt by 2019.

Thu, 04/26/2012 - 19:30 | 2378591 ultimate warrior
ultimate warrior's picture

I'll take the under on that.

Thu, 04/26/2012 - 19:32 | 2378586 ThaBigPerm
ThaBigPerm's picture

"As the cash surplus is depleted, which is primarily government I.O.U.'s, Social Security will not be able to pay full benefits from its payroll and other tax revenues. It will then need to consume ever-growing amounts of general revenue dollars to meet its obligations"

Methinks you don't understand what an I.O.U. is... it isn't cash on hand to spend.  It's already been spent, a Treasury Bond put in its place (the aforementioned "I.O.U.").  Aside from Obamacare, you cannot spend the same money twice by merely declaring the IOU to be "cash reserves".  In order to convert that IOU to cash, it must be redeemed either out of (then) current tax revenue or by issuing a new bond to another sucker, er, buyer, and those procedes used to redeem the old bond and pay benefits (I suppose they could sell the not-yet mature bonds on the open market as well, and the Fed could always print the $ to buy them in an increasingly saturated market).  Both options, by the way, being the same options available to the government if they'd never gone through the shell game of issuing itself IOUs in the first place and simply spent the money and worried about funding it later.  Crazy, I know.

Thu, 04/26/2012 - 21:24 | 2378887 SamThomas
SamThomas's picture

The bonds in the Trust Fund are called Special Issue bonds.  They are non-negotiable Treasurys which can only be redeemed by the Treasury itself.  Right now, Social Security is still in a positive cash flow when you include the interest paid into the Fund by the Treasury on these bonds, and when you include taxes on Social Security incomes of higher-income taxpayers.  But this will not last forever and eventually Social Security will start to run in a net deficit.  That is when the bonds in the Trust Fund will be presented to the Treasury for payment.  They will have to be refinanced, as you point out, by issuing regular Treasurys at auction in order to raise these monies.  And this is where I think the trouble will start, since this new supply will put pressure on the Treasury market and compound the overall fiscal situation of the Federal government--higher interest rates will cause higher government interest expense, and this will both have to be financed itself, or spending will have to be reduced in other areas accomodate it.  The budgetary pressure will be extremely difficult.  The easy way out will doubtless be pursued, since the problems are so large and intractable, meaning that the Fed will conspire with the Treasury (and Congress) and add billions of Treasurys to the Fed's balance sheet.  This monetization will have awful consequences in the near future as it translates into inflation and a lower standard of living.  Americans really have no clue what is going to hit them. 

Thu, 04/26/2012 - 19:29 | 2378587 Vince Clortho
Vince Clortho's picture

Everyone needs to relax.  Benny and the Laser Jets can print whatever amout of FRN is needed.

SS is saved.  We can lower retirement age to 19.

Be prepared to enter a new golden age for mankind.

And never forget, we owe it all to Ben freaking Bernanke and his uber-intelligent associates.

Thu, 04/26/2012 - 20:08 | 2378693 Bicycle Repairman
Bicycle Repairman's picture

They will print to fund lots of things, military, food stamps, disability, section 8, Columbian hookers, etc.  And SS.

Thu, 04/26/2012 - 20:58 | 2378827 engineertheeconomy
engineertheeconomy's picture

unemployment, postage, disability, etc, etc. printing is the gdp

Thu, 04/26/2012 - 19:43 | 2378623 BandGap
BandGap's picture

Wow, there's a jolt. I was going to support myself with SS and a bait shop. You know, collecting a check while selling six packs of Blatz beer and nitecrawlers.

Damn, way to burst my fucking bubble. I guess I'll have to try my luck at over 50 exotic dancing.

Thu, 04/26/2012 - 19:51 | 2378646 sessinpo
sessinpo's picture

BandGap                 2378623

I was going to support myself with SS and a bait shop.

 

Comment:

I guess you'll be the Master baiter?

 

Thu, 04/26/2012 - 22:07 | 2378969 worbsid
worbsid's picture

From about 1934 till 1957 my grandmother lived exclusively from renting boats and selling worms.  There was a lot of family help getting the boats ready by Memorial Day and taking them out in September.  The rest of the year she traveled ... from one kid to another until spring.  She didn't live very high on the hog but she lived and we all helped.  I cleaned boats and gathered worms for three summers.   

Thu, 04/26/2012 - 20:00 | 2378669 Bobportlandor
Bobportlandor's picture

I'm taking online classes to become a pimp.

Fri, 04/27/2012 - 00:58 | 2379286 Dburn
Dburn's picture

If that doesn't work out, try the training for entry level job as an assistant crack whore.

Thu, 04/26/2012 - 20:25 | 2378736 bobert
bobert's picture

Just hang around the Secret Service detail. That's where the real money is.

Thu, 04/26/2012 - 19:56 | 2378658 BandGap
BandGap's picture

I can jerk beef and venison, too, if they sit real still.

Good Lord, let's get on with the fucking collapse. 

 

Thu, 04/26/2012 - 20:04 | 2378674 Weisbrot
Weisbrot's picture

an easy fix - 1> remove the cap on the fica tax

                   2> NO $ out if you never put $ in

                   3> no $ out if you are truly financially secure

 

or perhaps I have an overly simplistic point of view.........

 

 

Thu, 04/26/2012 - 22:50 | 2379066 zot23
zot23's picture

How fucking dare you insert a sensible, logical solution amack in the middle of a perfectly good panic attack!  Some damn people, I tell ya...

Thu, 04/26/2012 - 20:15 | 2378710 yogibear
yogibear's picture

This pozi scheme lasted a long time. Sorry about all that money the Johnny come lately s will loose when it collapses.

Oh, you also made Apple shareholders a lot of money by buying all that I-stuff.

Eventually both go down.

 

Thu, 04/26/2012 - 20:47 | 2378790 Tom Green Swedish
Tom Green Swedish's picture

It was 2041 2 years ago. WTF happened?

Thu, 04/26/2012 - 21:02 | 2378838 BandGap
BandGap's picture

Oh geez, you didn't get the memo. See, as the spin state of the earth flips time will be compressed. It has to do with our individual magnetic fields (we are all driven my electrical impulses after all) coupling with the overall magentic field of the earth. As this drifts towards anisotropy, time - as we perceive it, is compressed.

Or, they pulled these numbers out of their ass and now they switched the asses they pull the numbers out of.

 

Fri, 04/27/2012 - 00:50 | 2379282 TBT or not TBT
TBT or not TBT's picture

Where did you study electromagnetic fields?   Clearly this has to do with hysteresis losses.

Fri, 04/27/2012 - 02:12 | 2379349 StychoKiller
StychoKiller's picture

It always comes back to Hysterics, don't it? :>D

Thu, 04/26/2012 - 20:51 | 2378796 Seasmoke
Seasmoke's picture

sounds just about right ......any suckers born 1965 or later are not in the boomers frat and will be left holding the bag

Thu, 04/26/2012 - 20:55 | 2378810 engineertheeconomy
engineertheeconomy's picture

so, let me see if i got this...

A Ponzi scam is a good thing if the rich benefit, a bad thing if the working class benefit...

how bout we end the bankers ponzi first

Thu, 04/26/2012 - 21:08 | 2378852 Pancho Villa
Pancho Villa's picture

In political terms, 2033 is pretty much equivalent to "the end of time". Nothing significant will be done until failure is only a couple of years away.

But they keep pushing forward the estimates of when SS will run out of money. It wouldn't surprise me if the actual date turned out to be 2025 or even 2020.

Thu, 04/26/2012 - 23:00 | 2379080 i-dog
i-dog's picture

 

"Nothing significant will be done until failure is only a couple of weeks away."

There...fixed it for you. (A couple of years is somebody else's problem).

No forecast, plan, budget, promise or action that is outside the current fiscal quarter is remotely believable (and even some within the current quarter are subject to "change due to unforseen circumstances", or "external factors").

What a fucking joke central planning is!

Fri, 04/27/2012 - 00:47 | 2379279 TBT or not TBT
TBT or not TBT's picture

Exactly.   The going broke process goes gradually for a long while then happens all at once, as we are going to see in cascade in Europe this year.

Thu, 04/26/2012 - 21:09 | 2378855 OrestesPenthilu...
OrestesPenthilusQuintard's picture

A gov't program going bad?

 

Not according to my TV.

Thu, 04/26/2012 - 21:34 | 2378902 Jason T
Jason T's picture

The average baby boomer thinks something along these lines.  They think they have $400k in their IRA ( SS fund) but they have $3 million in debt from boats, kids college educations they paid for, the vacation home, all those dinners out racked up on their credit cards, etc.

What they fail to understand is, all those gov't deficits that were rung up for the military industrial complex, bailout of the banks, war on drugs and whatever the hell else big gov't blew all them trillions on, that them SS checks are going to have to go to service the debt instead of paying for the bills.  

Best investment strategy is to go galt.  

Thu, 04/26/2012 - 22:47 | 2379060 zot23
zot23's picture

So can we stop issuing payroll holidays?  Since this is obviously super-nova hyper critical to solve?  

Fri, 04/27/2012 - 00:46 | 2379277 TBT or not TBT
TBT or not TBT's picture

Um, because 2033 is in the FUTURE, and congresscritters need to get elected in the PRESENT.

Thu, 04/26/2012 - 23:31 | 2379155 jarrollin
jarrollin's picture

So, social security is going to run into some problems?  File that under no shit Sherlock.

Fri, 04/27/2012 - 00:02 | 2379216 Change-In-Trend
Change-In-Trend's picture

  • My short S&P 500 position remains in play but is currently underwater. Rather than add additional shorts into strength i decided to keep my position sizing in order to reduce any more exposure to higher prices. 

  • If we are due for a higher close on Friday i will exit my position at a loss and protect my capital.
  • The equity cycles are suggesting that a move down is now imminent.
  • 3 Dow bellwether stocks, Microsoft, Exxon Mobil and and Boeing are already showing signs of weakness.
  • Exxon Mobil is showing signs of peaking at a time cycle high with a very strong dominant trend and high statistical probability. (see attached)
    • The USD Dollar ETF (UUP) is poised to move higher.

    https://www.dropbox.com/sh/ip40fvw18u62s2s/ToZcF9tITd/27%20Apr%202012

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    Fri, 04/27/2012 - 00:11 | 2379232 dirtbagger
    dirtbagger's picture

    So what happened to the money.   After contributions were doubled under the Reagan Admin SS fix, that was supposed to build a large enough surplus to take care of all of the boomers.   I think the plan was to also reduce the contribution rates after the boomers starting dying. 

    Granted contributions have decreased in recent years due to lower paying jobs and higher unemployment,  but you have to wonder if the Social Security Admin used unsustainable economic growth rates in their projections.   I've been contributing the full amount on both sides for over 3 decades, and want to see some return on my investment.

    Fri, 04/27/2012 - 00:45 | 2379275 TBT or not TBT
    TBT or not TBT's picture

    ....and want to see some return on my investment.

    SS became a slush fund for current spending, to buy off voters in the present, back in the past.   Your ROI will be very poor, unless some miracles in human longevity and/or productivity arise.

    Fri, 04/27/2012 - 00:42 | 2379270 TBT or not TBT
    TBT or not TBT's picture

    Bring out your dead!

    Fri, 04/27/2012 - 00:54 | 2379285 El Gordo
    El Gordo's picture

    Like there is any money in there in the first place.  We're 15 trillion in debt and someone is worried that SS will run out of money?  We ran out of money a long time ago, and that includes the SS contributions that were looted and spent as well.

    Fri, 04/27/2012 - 07:32 | 2379592 Peter Pan
    Peter Pan's picture

    When they talk about two workers to every retiree in 2025, they are talking about chaos. You may as well send grandma and grandpa on a six week luxury cruise when they turn 65 and then put them out of their misery with a needle. It might sound shocking but the alternative might be even more shocking. The mathematics are just impossible to overcome even with all the goodwill in the world.

    Fri, 04/27/2012 - 08:03 | 2379619 Disenchanted
    Disenchanted's picture

     

     

    Separate the SS monies from the general funds as was intended originally.

     

    Stop using the SS taxes that I and my employers have paid in on mine and others behalf to fund your goddamn wars, bailing out international banksters, and propping up Israel, Pakistan, House of Saud, etc.,etc....also known as 'foreign aid' or known to me as tax dollars(particularly SS money) subsidizing war profiteers, Zionist foreign policies, banksters, and corporate cronies.

    And no I don't give a flying fuck that 'foreign aid' is only 1% of GDP or any other bogus statistics or numbers someone wants to pull out of their ass to justify any of the previously mentioned misappropriations of our SS funds(or my tax dollars in general).

    Fuck you all very much.

    One more thing, put all the Federal employees and especially the politicians back into SS and everything else We the People have to deal with and take away their special retirement/health care plans. Then we'll see more serious discussion about 'fixing' SS and Medicare/Medicaid problems. As long as they have their separate and special plans those in charge do not give a real damn about what the 'little people' face with SS/Medicare.

    Fri, 04/27/2012 - 09:41 | 2379819 rwe2late
    rwe2late's picture

     Get your priorities straight!

     It is impossible to know how "real" the SocSec "problem" is without FIRST dealing with the annual trillion dollar global Pentagon,the Fed handouts to banksters, and the protections given to continue the "health care" racket.

     Get your priorities straight!

    BEFORE gunning for the so-called "entitlements" to the aged and infirm, ... go after the arms merchants, financial parasites, and the unholy alliance of the pharmaceutical and insurance industries.

    Get your priorities straight!

    Don't try "fixing" the jobs situation without dealing with the Depression caused by all the diversions, misuse  and waste by out-sourced labor, militarism, 'Homeland' policing, the neo-Prohibition prison industry, and the decades-long lack of human and physical infrastructure investment.

    In fact there isn't much chance of fixing anything without first dealing with the outrageous concentration of wealth and power by corrupt elite tycoons and their corporations.

     (though of course if one's intention is to ignore the above, fix nothing and just continue the fleecing ...)

    Fri, 04/27/2012 - 09:52 | 2380001 jplotinus
    jplotinus's picture

    The article is tiresome because the word "defense" appears merely once. The word "cut" is not found in close proximity to it, either.

    The issue is not one of affordability, rather the issue is prioritization of spending. Most developed nations on earth understand that pensions are a much higher priority than weapons. In the USofA, however, the mindset centers on a choice having been imposed upon us to live by the sword, come what may (I.e., death).

    That is too bad.

    Fri, 04/27/2012 - 09:55 | 2380009 jplotinus
    jplotinus's picture

    The article is tiresome because the word "defense" appears merely once. The word "cut" is not found in close proximity to it, either.

    The issue is not one of affordability, rather the issue is prioritization of spending. Most developed nations on earth understand that pensions are a much higher priority than weapons. In the USofA, however, the mindset centers on a choice having been imposed upon us to live by the sword, come what may (I.e., death).

    That is too bad.

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