Bush essentially Calls U.S. Treas Bonds 'Worthless

In Bush's attempt to derail Social Security, He actually demonstrated to the World today that you cannot trust U.S. Securities.

The Money Bush is spending is currently being financed by the same methods that he was ridiculing. We are already suffering because of the falling of the dollar and he just made it worse.

Does this guy understand that his spending programs are hurting the financial health of this country faster than any deficiet of Social Security?

Quote:

Quoting the article: "A lot of people in America think there is a trust -- that we take your money in payroll taxes and then we hold it for you and then when you retire, we give it back to you," Bush said in a speech at the University of West Virginia at Parkersburg. "But that's not the way it works," Bush said. "There is no trust `fund' -- just IOUs that I saw firsthand," Bush said. Earlier, Susan Chapman of the Office of Public Debt Accounting had shown Bush an ivory four-drawer filing cabinet with numeric locks. "This is it," she said. "This is what exists," Bush said, illustrating his point that the promise of future Social Security benefits are simply stashed in a file. Chapman opened the second drawer and pulled out a white notebook filled with pseudo Treasury securities -- pieces of paper that offer physical evidence of $1.7 trillion in treasury bonds that make up the trust fund.

[JohnP]

This is a blatent attempt at a monumental theft of moneys that were entrusted to the US government until needed after retirement. $1.7Trillion is $1,700 Billion or $1,700,000 Million - so it is not chump change!

What the president is attempting is a double theft;
(1) Privatizing SS leading to a full transfer of retirement risk to working people and
(2) a dis-acknowledgement of baby-boomer's pay ahead contribution since 1983.

I don't have the exact figures in front of me, but I believe that $1.7Trillion is a double digit percentage of the net worth of the entire United States.

It deserves your attention. Think about it - this is truly a monsterous theft. If the president can negate this debt (while still benefiting every year from the SS Surplus) then our creditors should be quaking in their boots.

JohnP

[unclemick]

I can think of a few central banks around the world that 'might' feel impelled to give Mr B. an additude adjustment. Sort of like they socked it to Tricky Dick in the 70's. We got to share the pain(stagflation??) of that one a long long time.

[Martha]

So Bush says there is no trust fund and only a bunch of paper in a drawer. He should tell that t0 the social security administration. The official government web site at www.ssa.gov/OACT/ProgData/fundFAQ.html says:

. . . most of the money flowing into the trust funds is invested in U. S. Government securities. Because the government spends this borrowed cash, some people see the current increase in the trust fund assets as an accumulation of securities that the government will be unable to make good on in the future. Without legislation to restore long-range solvency of the trust funds, redemption of long-term securities prior to maturity would be necessary.

Far from being "worthless IOUs," the investments held by the trust funds are backed by the full faith and credit of the U. S. Government. The government has always repaid Social Security, with interest. The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the Federal government.

Many options are being considered to restore long-range trust fund solvency. These options are being considered now, over 35 years in advance of the year the funds are likely to be exhausted. It is thus likely that legislation will be enacted to restore long-term solvency, making it unlikely that the trust funds' securities will need to be redeemed on a large scale prior to maturity.

[Zipper]

You guys need to look at the Canada Pension Plan.

For years it was a slush fund for the provinces to borrow at below market rates.

We saw your problems back in 1998 and took steps to correct the situation. No more worthless IOU's.

Now it invests in the best available. Worldwide.

I started collecting the month after I turned 60 in 11 2003.

And I have no worries that my sons (31) & (33) will collect at 60 as well.

And Mrs. Zipper's numbers come up in 03 2009!

[Nords]

Quote:

You guys need to look at the Canada Pension Plan.

OK (*sigh*), we'll take it. *How much do you want for it? *In EE bonds or will you take a discount for cash (dollars)? Can we pay you a little later on?

[Zipper]

The major point Nords, is the CPP board is stand alone, and not subject to political interference.

[unclemick]

Dream on!

Governments are governments - wait till they need the money. Think Britain in the 70's.

One can hope though.

[Eagle43]

Quote:

The major point Nords, is the CPP board is stand alone now, and not subject to political interference.

A not insignificant point; politicians can't keep their hands off a pile of money, no matter where it is. I already worry about IRA withdrawals, when some well-meaning politician decides that I make/have too much, therefore he's gonna have to either stop my ss or tax my IRA more. That would be so he could take care of the unfortunate individual who did not have foresight to save, don't ya know. Gotta take care of them unfortunates

Eagle,

Your Boy Bush screwed up big time with these comments on Treasury Bonds! - If nobody calls him on this one I'd be surprised!

He can only hope that the right/wrong people don't run with this!

[haha]

Quote:

Your Boy Bush screwed up big time with these comments on Treasury Bonds! - If nobody calls him on this one I'd be surprised!

Don't you just get really tired of having a dyslexic ADHD moron for a President? I know I do.

Mikey

[Jarhead*]

Quote:

A not insignificant point; politicians can't keep their hands off a pile of money, no matter where it is. *I already worry about IRA withdrawals, when some well-meaning politician decides that I make/have too much, therefore he's gonna have to either stop my ss or tax my IRA more. *That would be so he could take care of the unfortunate individual who did not have foresight to save, don't ya know. *Gotta take care of them unfortunates *

Eagle43: With mulitiple pensions, Soc. Sec. and Ira, you wouldn't mind sending "OL Jarhead" a few bucks, would you? That's alright, but the next rounds on you.

[Sheryl]

Quote:

Don't you just get really tired of having a dyslexic ADHD moron for a President? I know I do.

In a word: Yes.

[Craig]

Quote:

"But that's not the way it works," Bush said. "There is no trust `fund' -- just IOUs that I saw firsthand," Bush said.

For heaven's sake. With respect, I don't see the big deal. He's right. They are IOU's. Backed by full faith and credit perhaps, but ... they are IOU's, not the infamous "lock box" of cash. And Democrats and Republicans alike have been spending the social security surplus for years, and using it as an offset to report a lower budget deficit. We let them.

This isn't just Bush's creation, any more than it is just Clinton's. And we were getting wind of this many, many years ago. No one screamed then.

I'm certainly not an expert, or an economist ... but it may be worth our while to consider alternatives, like those adopted by countries like Chile and many others. The current system is not viable long term. This isn't about a bozo President ... Clinton or Bush.

I hear Canada is great all the time ... especially from Canadians that come here to start businesses or take advantage of our health care ...

[Michael]

Quote:

Now it invests in the best available. Worldwide.

Putting that 1.7t in an international index fund might make SS solvent, but how did you ever get your politicians to go for it?

[uncledrz]

Quote:

This isn't just Bush's creation, any more than it is just Clinton's. *

The economic policies of the Bush administration most clearly are his, as are the results. This President has never had a balanced budget. He put through massive tax cuts at the same time he significantly increased spending. Thus, a budget surplus has turned into a budget awash in red, with no realistic hope that it will be brought under control. The end result is that the government will have difficulty meeting its commitments.
No one person is completely responsible, President Bush and his economic policies are a major contributor.

[MRGALT2U]

Well, I don't think Bush is stupid, just a little
inarticulate and not really a deep thinker.
Shoots from the hip (lip?) without really analyzing
the impact of what he says. If he wasn't the Pres.
of the US, some might find this charming.

JG

[farmerEd]

Quote:

Well, I don't think Bush is stupid, just a little inarticulate and not really a deep thinker. Shoots from the hip (lip?) without really analyzing the impact of what he says. *If he wasn't the Pres. of the US, some might find this charming.

Lets see...a "non deep thinker" that "shoots from the hip", "without analizing the impact of what he says"...if thats not stupid I don't know what is.

If it walks like a duck, and it quacks like a duck.....

[MRGALT2U]

farmerEd has a point, which I assumed someone
would bring up (I love it when you pay attention)

I find "W" likeable, so I cut him a lot of slack. I also
keep reminding myself that I would not have wanted
the other guy, no matter what..............even if Bush
was a blithering idiot, which I know many of you believe
to be the case.

JG

[unclemick]

Bush is not dumb by long shot. Being left handed - here's the deal:

Bogle, Bush, and the Canadians are on the same page - remove the temptation of other agendas.

Bogle: costs matter- i.e. if 'they' are charging high expenses/fees - the industry(mutual funds, pension management, etc) are ignoring the 1940 Investment law, lining their own pockets and NOT putting the customer first as stated in the Act.

Bush: put some of the money into the hands of the customer and let him decide presumably with his inlightened best interest working independant of other(political agendas).

Canadian: Put in some trustees with 'independance' from other agenda's(politicians, govt money wants,etc) so they can focus on the customer/retiree.

Trashing the 'full faith and credit of Treasuries' and the ability of the U.S. to pay it's debts may touch the nerve of American scepticism of politicians - but I worked with a lot of Brits over thirty years - some of whom could tell you about the long decline of the Pound after they borrowed from American banks(circa -1900, the Boer War) *- never mind subsequent debts.

The nuts and bolts of working the problem - are the nuts and bolts- they are not going away.