Social Security Proposes "Immediate And Permanent Reduction" In Benefits

Authored by Simon Black via SovereignMan.com,

On a deep, dark evening last June in the spectacularly celestial deserts of northern Chile, scientists made a phenomenal discovery.

It was a supernova… one that they named ASASSN-15lh.

This wasn’t just any supernova. It was the BIGGEST and BRIGHTEST supernova ever recorded.

Supernovas are exploding stars whose ejected mass and energy can create a light show so brilliant that they can sometimes be seen with the naked eye in our own night sky.

At its most luminous, ASASSN-15lh was over 500 BILLION times brighter than our own sun, and FAR greater than the previous record holder.

This is so bright that, according to one of the lead researchers, if it had been located within our own galaxy there would have been no darkness on earth for weeks.

Fortunately for us, ASASSN-15lh was from a galaxy far, far away– 3.8 BILLION light years away. So its intensity didn’t have much of an effect on Planet Earth.

Of course, such a prodigious distance also means that ASASSN-15lh actually went supernova 3.8 billion years ago.

The star was so far away from our planet that it took billions of years for the light from the supernova to reach us.

It’s mind boggling to think about. But in a way, the same can be said of many of the financial risks that we face.

 

https://www.zerohedge.com/sites/default/files/inline-images/20180109_ss.png

Consider the exploding star of Social Security, one of the largest and most important pension programs in the world.

Literally tens of millions of people depend on it.

The Social Security Administration itself reports that 62% of recipients rely on the program for at least HALF of their income.

And further research by the Center on Budget and Policy Priorities (CBPP) shows that, without Social Security, 22.1 million Americans would fall below the poverty line.

Needless to say, major cuts to the program would have nuclear effects.

And yet, year after year, the Social Security Board of Trustees publishes an annual report that describes the program’s terminal financial challenges in excruciating detail.

They mince no words in plainly stating that Social Security pays out far too much money, and takes in far too little.

According to the 2017 Trustees report, “Trust Fund reserves become depleted in 2035.”

They’re practically giving us a date that we can circle on a calendar and mark “End of Social Security.”

The Trustees go on to lightly propose solutions, including an “immediate and permanent reduction” in benefits to all current and future Social Security recipients.”

And in case you’re wondering who these whack-job Trustees are, they include the Treasury Secretary of the United States, the Secretary of Health and Human Services, and the Secretary of Labor.

These aren’t just random people.

We’re talking about politicians at the highest levels of government who are telling us that Social Security is running out of money… and calling for an immediate and permanent cut in benefits.

Given the tens of millions of people who depend on the program, the consequences of either scenario would be catastrophic.

Sadly, this is not a new problem. The Trustees have been screaming for years that Social Security’s finances are unsustainable.

Yet year after year, the problem was ignored… which brings the end-game one year closer, and the ultimate solution that much more painful.

That’s what makes Social Security a gigantic supernova.

The star exploded years ago. But it will take until 2035 for everyone to realize it… though frankly it could be sooner than that.

People are living longer than ever before– the average life expectancy in the US is a full EIGHTEEN YEARS longer than it was when Social Security was conceived back in the 1930s.

This means that Social Security will have to pay out more money to more recipients for much longer than they’ve ever had to pay before.

This will be an enormous cost to the program.

Simultaneously, despite all the celebration of the low unemployment rate in the US, the Labor Force Participation Rate is still near a multi-decade low.

This means that there are fewer people in the work force who are actually paying in to the Social Security System.

According to its own projections, Social Security requires 3 employed workers to support one retiree.

And they watch this worker-to-beneficiary ratio very closely.

In 2010 it dipped below 3 for the first time, and in 2013 hit 2.8. The Trustees’ projections show it will continue to fall, to as low as 2.2.

So if you look at the big picture, a growing number of beneficiaries is being supported by a declining number of workers.

This isn’t rocket science– it’s pretty obvious what’s going to happen.

Yet the collective response is to simply ignore the problem… or outright refuse to believe it, as if this is some crazy conspiracy theory.

This isn’t a theory.

It’s simple arithmetic based on government data, backed by the same conclusions reached by the Treasury Secretary of the United States.

Now, the bad news is that none of us can actually fix Social Security.

And we sure as heck can’t convince someone to prepare for a problem that they refuse to acknowledge.

But we can easily do something about it ourselves.

After all, this is one of those MAJOR problems we’ve been talking about– and one that can easily be avoided.

The good news is that many of the solutions haven’t changed with the new tax law.

You can still establish, for example, certain self-directed IRA structures or a solo 401(k).

These structures not only dramatically increase your contribution limits (to more than $50,000 annually), but also vastly expand the universe of investment options– real estate, cryptocurrency, private equity, etc.

So ultimately you could save more, and earn more, for your retirement.

The Social Security star has already exploded. But it will take the light another 15+ years to reach us.

That’s plenty of time to prepare for anyone with the right education and the will to act.

Comments

RAT005 Lost in translation Jan 9, 2018 5:08 PM Permalink

Not one mention of the early excess funds being stolen when the gov. turned it into a ponzi scheme so sure there would always be enough future payments to pay current obligations.  If the money had never been stolen, and accumulated at even only 10yr T-Bill rate, there would be no shortage now.  We each contribute about 13% of our lifetime earnings.  That amount adequately funds your annuity from age 65 - ~85 at around 25% of your employed salary when compounded at 10yr Tbill rate for the ~40yrs you contribute.

In reply to by Lost in translation

Golden Showers FoggyWorld Jan 9, 2018 6:22 PM Permalink

Far as I can tell Social Security is unlawful. There is no law that says one has to pay social security taxes, nor for that matter "income" taxes. Both are voluntary.

What Social Security is--is a federal government employee retirement account where it is presumed you work for the federal government and therefore you give up your Constitutional Rights for the privelege and benefits of a federal government employee. You get a savings account that pays de-facto employees today and it's pure socialism.

Try to get a jobby job without registering or fraudulently portraying yourself as an "Office Holder" in the federal government (without taking an oath) and that is FRAUD. However the presumption is that you are indeed a statutory us citizen office holder for the purpose of the benefit and privelege of being taxed on "income" and "wages".

Every tax form you fill out, you witness against yourself and perjure yourself. However, you are compelled to do so. You are compelled to sign up for selective service at 18 if you are a male. Pretty much everything you sign, attach your social # to is illegal, unlawful, and purjory. Fact is you have no fucking rights. The Constitution IS just a piece of paper. And it doesn't matter because your federal reserve dollars are worthless.

The only document you have signed by any government or state office is your Birth Certificate. Go look.

Being born a citizen or being sworn in a citizen grants you zero freedom. Illegal immigrants have more freedom than statutory US citizens. That's obvious.

Between now and '35 the government will make up some new shit to fuck with your kids with.

Also please go back to the bus for Ida May Fuller, first SS recipient: http://www.dailymail.co.uk/news/article-2932568/Meet-Ida-May-Fuller-rec…

In reply to by FoggyWorld

nmewn YUNOSELL Jan 9, 2018 8:52 PM Permalink

See!

You try to tell people for what...going on eight years now?...that YOUR MONEY IS NOT THERE THAT YOU PUT IN...that "the system" is in fact, socialist and like all other socialist systems it has taken your money, that you trusted them to take care of, for you, until you retired and..."the system" has spent it.

Now "the system" wants your kids and your grand kids to pay..."the system"...to take care of you WITH a promissory note that "the system" holds up saying its valid and it (the system) will take care of them when THEIR time arrives.

Ya nooowah!...Little Timmy Giethner inadvertently exposed this little ponzi fraud during the last government shutdown by HIS actions, right?...lol...that money taken out of your check every week DOESN'T go into "your retirement fund".

That money goes to the most fiscally sound entity one can think of (lol) who's impeccable history of sound monetary policy and fiduciary duties & responsibility to "their clients" at managing their finances is unquestioned.

It goes to .gov and is promptly...spent ;-)

In reply to by YUNOSELL

Bastiat RAT005 Jan 9, 2018 5:21 PM Permalink

Sell 100 year 2% Bonds to the Fed, Fed creates the money out of thin air because they have "this thing called a printing press" to quote the Bernankster.  If the Fed doesn't want to buy the bonds at 2%, lower it 1% and surround them with tanks. Problem solved. Or are the $trillions from thin air only for crooked banksters?

In reply to by RAT005

Itinerant Bastiat Jan 9, 2018 10:05 PM Permalink

Indeed. Whatever the real problems involved in paying social security, the problem is not lack of money. Having stuffed the mattrasses at the SS Administration in the eighties would make no difference to the ability to provide seniors in the 2030's with the power to consume. The problem is not whether there is enough money stuffed into a certain pot, but whether the economy will have the productive capacity to provide for seniors. Thinking about it in terms of jars full of money is kind of like not thinking at all.

In reply to by Bastiat

Dabooda boattrash Jan 10, 2018 2:52 AM Permalink

You wish.  Every dime they stole has been spent.  Any refund can only come from .gov stealing MORE.  My sympathy to everyone who believes they are entitled to "their" Social Security, because they paid into it all their lives.  But the money they paid is gone.  Spent on bombs, on welfare (mostly to corporations), and on thousands of porkbarrel boondoggles.  You've heard of the umpteen-trillion dollar hole which is the National Debt? That is your Social Security trust fund.

In reply to by boattrash

MK ULTRA Alpha RAT005 Jan 9, 2018 7:22 PM Permalink

Social Security owns over $3 trillion in US government debt. Social Security uses federal government payments on that debt to pay out claims each month.

Social Security is easy to save, it's underfunded, it's not just for the poor, it's for the middle class. The income exempt from social security needs to be raised a small amount and suddenly, social security is solvent. Plus, the 10 or 20 million or maybe it's 30 million undocumented workers need to pay social security, that's another drag on solvency when a portion of the work force isn't paying in.

Trump made the pledge not to cut social security. It looks like Sessions went back on his word on a lot of things, Trump seems to follow suit. The VA just attempted to throw homeless vets into the street, around 150,000-180,000 counting total programs, it could be more.

The entire tax cut will be paid for on the backs of the poor, disabled and those who are unemployed because corporate and federal government policy was to ship all the jobs to China. Now they'll revoke the mandate for payroll tax. Then we will know Trump is against working poor.

Trump is losing support by the day, the Sessions cannabis fiasco plays to red neck haters, but to a wider segment who held their nose to vote for Trump, (the democrat choice wasn't acceptable), but to this segment, the "Defectors" these social issues are important enough to vote Trump out of office.  This is far more important to a greater population segment, we'll hear, my uncle, my mother etc lost their social security. It will become the main driving issue, main platform for the Democrats. Even Sessions cannabis war will become a major political platform. Trump believes if the economic numbers are good, he will automatically be reelected.

In reply to by RAT005

MK ULTRA Alpha shovelhead Jan 9, 2018 9:37 PM Permalink

The homeless vets are in housing, man do you have to have everything spoon fed to you. The Trump administration's stated goal is a cut of $150 billion in social services spending, that's on the backs of the poor and disabled. The intended cuts are to be used to pay for the tax cut per congress and Trump, it is being said it is the same method used by Reagan.

Do you get all your knowledge from TV and then come here to rebroadcast. Try reading more and maybe, just maybe, your understanding or should I say, learning curve might kick in.

In reply to by shovelhead

Bwana MK ULTRA Alpha Jan 10, 2018 2:59 PM Permalink

For instance, The US gives 75 billion dollars to illegal immigrants. Their medical care cost another 50 billion annually. Then if you take the illegal immigrants off social security we would have a surplus. If I was an illegal immigrant who has never paid a dime into social security I would get an additional $1,000/ month (thanks Jimmy Carter). Really! why should illegals get anything from the US treasury or the tax payer?

In reply to by MK ULTRA Alpha

Crawdaddy MK ULTRA Alpha Jan 9, 2018 9:27 PM Permalink

SS is a govt scam. Free men and women do not need it. It is only because we have been robbed so long of our assets now we turn to the theft and recklessness of govt to consider the govt force fed options. The govt is corrupt, there to stick its nose in your wallet and make you like it. And your neighbor most likely signed off on it, hopefully in ignorance, under duress.

In reply to by MK ULTRA Alpha

MK ULTRA Alpha Crawdaddy Jan 9, 2018 9:41 PM Permalink

How old are you and how long have you been paying into social security. Most people pay into social security all of their lives, and expect to get it back in old age payments.  Have you been brainwashed about social security, it's bad etc for many reasons. Well when the homeless which is now epidemic increases by 30 million Americans, then you'll say like Bush II they're not working hard enough.

How long have you been paying in? How old are you? I am over 60 and paid in to social security all of my life, now it is to be taken away or cut in half.

In reply to by Crawdaddy

rwe2late RAT005 Jan 9, 2018 7:51 PM Permalink

 SocSec was changed from a retirement program

to also pay for disability insurance. It was cover for the lack of

proper investment in physical and social infrastructure,

the debilitating "war on drugs",

and environmental degradation and pollution

---all of which caused a decline in the general health of the public.

Let's not forget how the taxes allegedly collected for SocSec were

instead thrown into the general fund and used for wars and bankster bailouts.

In reply to by RAT005

MK ULTRA Alpha rwe2late Jan 9, 2018 9:48 PM Permalink

Really, Social Security has well over $3 trillion official US government bonds, how is congress or Trump going to break the law to take it back. You didn't know, every dime borrowed by congress was a BOND. Part of the US national debt of over $20 trillion is owed to our own government institutions.

If you want to see Trump a one term, follow Paul Ryan's insanity to reform social security to save it by cutting off those below 56 and have your mandatory payments sent to Wall Street to save it. The lies being told about Social Security is to rob social security payments made by Americans.

Everything I have read by the TV heads on this board about Social Security is inaccurate. No objectivity, just belligerent parroting their propaganda programming.

 

 

In reply to by rwe2late

CNONC MK ULTRA Alpha Jan 9, 2018 10:21 PM Permalink

You really should know better.  The "bonds" held by the SS trust fund are non tradable and not counted in the official tally of US gov't debt.  It is a pure accounting gimmick.  The revenue generated by SS taxes, when they were in surplus, were transferred directly to the general fund and spent.  Only an accounting entry, masquerading as a bond, exists where the money once was.  When it is time for SS to "redeem" those "bonds," the money must come from the same general fund.  It is at that point that the government must either raise taxes or borrow from the private sector.  Only then does the debt incurred become "official" and counted in the total US debt.

If you insist on believing that those bonds have any real value, do a little more research and find out what happens if the government defaults on the bonds held by the SS trust fund and compare that to the consequences of defaulting on publicly held treasury instruments. 

Get back to me after your research and let's reexamine your belief that social security can be easily fixed.

In reply to by MK ULTRA Alpha

Tapeworm CNONC Jan 13, 2018 7:03 PM Permalink

You have this completely correct.

 I am now 67 of years and have not yet tried for SS as i KNOW THAT IT IS JUST A THEFT FROM the youngers that "contribute". As an employer I get to pay the other half of all of my employee's "contributions" and mine. The same goes for medicare.

 I pay far more than half of my gross income to taxes. My guess is about 64.5%, although it is difficult to measure the taxes upon taxes upon taxes.

 My pay into SS has been going on now for fifty-three years where most years were at the maximum.

 No SS funds exist. All is transfer payments from youngers to older that paid in but didn't do anything about the thefts.

In reply to by CNONC

MoreFreedom RAT005 Jan 9, 2018 9:00 PM Permalink

"... when the gov. turned it into a ponzi scheme "

It was always a Ponzi scheme.  And politicians promises about it are as good as a socialist's promises, because Social Security (and Medicare) are socialist. 

Speaking of Medicare, it turns out that seniors getting their "free" Medicare, spend more (relative to their spending) on health care than they did before Medicare existed.  So says David Goldhill (CEO of GSN, life long Democrat, and author of "How American Health Care Killed My Father").   Which is what intelligent people would expect of a government socialist program.

In reply to by RAT005

fattail RAT005 Jan 10, 2018 6:59 AM Permalink

I wonder what were the economic growth assumptions munchkin was using.  The obama treasury secty used a 5.1% 10 year economic growth rate to get to 2034 for SSI and 2027 for medicare.

If you go back and read the articles the projected insolvency of SSI has been hanging out there at the 18 year mark for quite a while.  

In reply to by RAT005