UnThreaded | Threaded | Whole Thread (10) | Ignore Thread Prev Thread | Prev | Next | Next Thread
Author: AdvocatusDiaboli Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 682449  
Subject: Re: Harry Reid is dangerously stupid. Date: 10/3/2012 11:40 AM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 5
I wonder what is behind the Democratic commitment to avoiding reality at all costs. Is it raw stupidity or is it something more sinister? In Reid's case, it comes across as raw stupidity.

It's a question of how you define the deficit.

In essence, if you want to "cut SS to decrease the deficit", you're defaulting on the Social Security Trust fund which was created by Reagan to ensure the long-term viability of SS.

Until very recently, Social Security was in surplus, with that surplus being "invested" into government bonds. Unfortunately, the way the accounting was done was to count SS payroll taxes towards general government revenues so that the SS surplus seemed to reduce the actual deficit the government was running. Which it really didn't.
This optical illusion/sleight of hand/accounting fraud allowed Reagan and Bush II to cut taxes and run deficits that were much larger than they appeared. Bush II, at the peak of the economic cycle, was running a deficit that was really around 700 billion dollars.

In retrospect, the SS looks less like a mechanism to guarantee the viability of SS and more like a strategy in which the GOP raised taxes (payroll taxes) on the middle class, using the proceeds to finance tax cuts for the rich.
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (10) | Ignore Thread Prev Thread | Prev | Next | Next Thread

Announcements

Invest Better Hub
Take advantage of our newest free service, Invest Better!
New Fool-Branded Credit Card Available!
How does your card compare to ours?
Post of the Day:
Supernova Phoenix 1

When Does the Party End?
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Facebook Fool Fan Club
Be a fan of the Fool over on Facebook!
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Get the Fool Phone App
Save and share content, zero in on sectors, podcasts, and much more!
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement