Election 2010: Teabaggin' the Ds & Rs

[Adder]

Originally Posted by Mmmm, Burger (C.J.)

Did you account for the fact that the Navy escapes from any environmental cleanup costs of the nuke?

No. Er. Or maybe I mean yes. I had assumed that the environmental cleanup would make the nuclear option more expensive than your conventional replacement.

[Adder]

Originally Posted by Greedy,Greedy,Greedy

There more savings at lower levels. Yeh, we can cut a million here and there on shipping surf-boards for white house staffers, but given the number of federal employees, if we find a way to save $1 per day for each one, we save millions every day. It's all about cutting their benes, perks and salaries, not worrying about the white house.

That's a good start. Burger, work your magic!

[sgtclub]

Originally Posted by Adder

Yeah, that was my point. The trust fund is a fiction.



Honestly, I'm not sure what you are trying to say, and in particular what you mean by now vs. then.

Oh, so maybe we are making the same point.

[Cletus Miller]

Does he have any chance?

This makes too much sense, tho.

[sgtclub]

Originally Posted by Cletus Miller

Does he have any chance?

This makes too much sense, tho.

His name is currently mentioned in the third tier of GOP candidates. I think it's too early to tell how it shakes out, but I don't see anyone in the top tier (Romney, Palin, etc.) being able to beat Obama.

[Adder]

Originally Posted by sgtclub

Oh, so maybe we are making the same point.

I think so. The trust fund isn't relavent to paying future benefits. I said they will need to be paid for out of current tax receipts going forward (as they have been in the past actually), and on further review I think you said or we borrow to pay (because a deficit is a deficit).

Btw, I think an implication of this line of thinking we should ignore the $4+ trillion in debt that's held by the trust fund. So woo hoo! Less debt! Still higher future taxes, of course.

Of course I am assuming that one day we will have a government that is interested in making the tough decisions to pull together enough spending cuts and tax increases balance the budget.

[Cletus Miller]

Originally Posted by sgtclub

His name is currently mentioned in the third tier of GOP candidates. I think it's too early to tell how it shakes out, but I don't see anyone in the top tier (Romney, Palin, etc.) being able to beat Obama.

I of course didn't mean agst Obama, I meant in the R primaries.

[Tyrone Slothrop]

Originally Posted by sgtclub

His name is currently mentioned in the third tier of GOP candidates. I think it's too early to tell how it shakes out, but I don't see anyone in the top tier (Romney, Palin, etc.) being able to beat Obama.

If the economy is bad, anyone of them can beat Obama. And if the economy is good, they're all hosed.

[Cletus Miller]

Originally Posted by Adder

Btw, I think an implication of this line of thinking we wer should ignor the $4+ trillion in debt that's held by the trust fund. So woo hoo! Less debt! Still higher future taxes, of course.

I don't think this is correct, as once the SS Bonds are being paid off (ie, swapped for public debt), the shortfall goes on-balance sheet, where the accumulation of the SS Bond debt has been off-balance sheet.

[Adder]

Originally Posted by Cletus Miller

Does he have any chance?

This makes too much sense, tho.

Um. Not this part: "The government is, essentially, the last monopoly."

In the hope that they will all someday be my clients, I will not list the various monopolies that come to mind, but let's just say there is more than a few.

Also, this is a description of a broken democracy (which is not to say it's wrong): "In government, I always say you have to transplant or implant accountability, ’cause it doesn’t come naturally."

As to this: " That is to say it should protect the liberties and the safety of citizens, first and foremost, and then it should act to make possible … the growth of the private sector, on which everything else depends…"

Well, yeah, but what about those monopolies (which have traditionally been an organic part of private sector growth)? What about externalities?

I like what he says about SS and Medicare, and in particular that he doesn't pretend that the hard questions don't exist, but some of this sounds like pretty standard conservative "government is always a problem."

[Mmmm, Burger (C.J.)]

Originally Posted by Cletus Miller

I don't think this is correct, as once the SS Bonds are being paid off (ie, swapped for public debt), the shortfall goes on-balance sheet, where the accumulation of the SS Bond debt has been off-balance sheet.

Maybe I'm misunderstanding you, but as the SS trust fund redeems the Tbills it "owns" to pay benefits (i.e., its net purchases become negative) then Tbills will have to be sold instead to the private sector to finance the debt. But it's still debt, just to someone different. FWIW, the "debt" that is widely cited ($14T and growing) includes the debt to the SS trust fund.

[Adder]

Originally Posted by Cletus Miller

(ie, swapped for public debt)

If this is what happens, you're right. But that's not what happens to those bonds if we are paying for SS out of current revenue (again, assuming a balanced budget that includes SS, which is the fantasy world I'm working in).

Maybe I'm missing something, and I don't really have a sense of the relative size of the flows and the mechanics of how they work, but bonds from the trust fund only get paid off as surplus turns to deficit, right? So if there's no more deficit (i.e. current revenues are sufficient), there are no bonds to pay off aside from rolling over, or better yet legislating them away).

Also, based only on the numbers you cited, I thought the trust fund bonds were included for purposes of the debt ceiling (currently around $14 trillion and roughly the sum of the two numbers you gave).

[Cletus Miller]

Originally Posted by Mmmm, Burger (C.J.)

Maybe I'm misunderstanding you, but as the SS trust fund redeems the Tbills it "owns" to pay benefits (i.e., its net purchases become negative) then Tbills will have to be sold instead to the private sector to finance the debt. But it's still debt, just to someone different. FWIW, the "debt" that is widely cited ($14T and growing) includes the debt to the SS trust fund.

I was under the (possibly? certainly? mistaken) impression that SS wouldn't be selling the bonds, but having them repaid. If they are actually going to be selling them on the open market, (1) they will recover less than face and (2) that will likely have some unexpected/unintended consequences.

[Cletus Miller]

Originally Posted by Adder

If this is what happens, you're right. But that's not what happens to those bonds if we are paying for SS out of current revenue (again, assuming a balanced budget that includes SS, which is the fantasy world I'm working in).

Maybe I'm missing something, and I don't really have a sense of the relative size of the flows and the mechanics of how they work, but bonds from the trust fund only get paid off as surplus turns to deficit, right? So if there's no more deficit (i.e. current revenues are sufficient), there are no bonds to pay off aside from rolling over, or better yet legislating them away).

Also, based only on the numbers you cited, I thought the trust fund bonds were included for purposes of the debt ceiling (currently around $14 trillion and roughly the sum of the two numbers you gave).

SS is in deficit this FY. To pay all benefits in FY-11, SS will need to draw on the bonds.

And, yes, the SS Bonds are covered in the debt ceiling.

[Adder]

Originally Posted by Cletus Miller

I was under the (possibly? certainly? mistaken) impression that SS wouldn't be selling the bonds, but having them repaid.

I don't see how this relates to Burger's question. Today, before my fantasy world, the trust fund redeems the bonds (i.e. has them repaid by treasury). There is currently a deficit, so treasury issues new bonds to pay for it (oddly enough, likely at lower rates, but let's leave that aside). But net change in the $14T in debt is zero, no? Instead of owning the trust fund, new bond holders are now owed.

ETA:

If they are actually going to be selling them on the open market, (1) they will recover less than face

Is that right? Assuming that they could actually sell their special issue securities, it like a lot of what they hold maybe at well above market interest rates.