Jul 12, 2011

Finally, A Warning

From CBS News:
President Obama on Tuesday said he cannot guarantee that retirees will receive their Social Security checks August 3 if Democrats and Republicans in Washington do not reach an agreement on reducing the deficit in the coming weeks.
"I cannot guarantee that those checks go out on August 3rd if we haven't resolved this issue. Because there may simply not be the money in the coffers to do it," Mr. Obama said in an interview with CBS Evening News anchor Scott Pelley, according to excerpts released by CBS News.
Update: I have taken down a couple of ridiculous comments arguing over whether the President is "lying." There have been too many abusive comments of this sort here.If anyone thinks the President is "lying", take a look at the Republican response to the President revealing that Social Security checks won't go out on August 3 unless something is done very soon on the debt ceiling.

18 comments:

Anonymous said...
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Anonymous said...
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Anonymous said...

I am highly skeptical that failure to raise the debt limit will result in cuts or delays in Social Security checks since the funding source is intact -- payroll taxes will keep rolling in. The only reason that checks would be delayed or cut would be if Democrats in Congress or the President (or his administration) wants to play games and try to pressure the Republicans into agreeing with their terms. I would be much more concerned about federal employees receiving their paychecks on time; hospital/doctors receiving Medicare/Medicaid reimbursements -- which are already notoriously slow; and other services/payments being provided timely.

Anonymous said...

What if you criticize Obama, you post gets pulled. If I said Boehner is lying, I’m sure it would still be there.

Anonymous said...
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Anonymous said...

Anon 423: You are talking about playing games and pressuring--give me a break. This is one big game to the R's and they keep pressuring the President to do everything they want or they pick up their marbles and go home. What a bunch of babies. When are they going to compromise? They haven't given in on one single thing. Just cut everything for the middle class and the needy but don't touch anything for the rich and businesses. Oh go eat your peas!

Anonymous said...

This blog is the mainstream media in miniature. It is leaning so far to the left, I’m surprised that it doesn’t fall over.

Anonymous said...

"When are they going to compromise?"

Why should they. I guess you forgot about last November's election.

Anonymous said...

I did not claim that the Republicans were not engaging in pressure tactics; both sides are posturing and trying to apply pressure. Rather, I stated that the claims of Social Security cuts or delays on August 3rd are fear-mongering in my opinion. I do not believe there is a legitimate need/risk of these cuts or delays in payment. In fact, if the FED is no longer allowed to borrow money as of August 3rd, it ought to make the Social Security trust fund more secure since the Fed could no longer borrow payroll tax receipts to fund other programs, as has been the case for decades. Retirees and DIB recipients ought to be fine. SSI recipients, on the other hand, may be screwed since SSI comes out of general revenue.

Don Levit said...

Anonymous (the last one)
Very well said.
And the prior comment that FICA taxes keep rolling in is correct also.
These taxes go directly to the beneficiaries.
There is an interest deficit, however, for outgo exceeds income, excluding interest.
Thus deficit can be made up only with general revenues (or increasing the debt ceiling).
Don Levit

Anonymous said...

How can you take away ssi from everyone you are not looking out for us!!! but you can rebuild other Countries with our money people that have blown us up, killed our people and still plan too this is sick! Get stuff straight in the offices. this is just pure evil to do this to your own. it sickens me to know we have hungry children in our Country that go hungry every night but yet we feed other Countries. the American people help out the American people not the congress ect... may be you all should take a cut in your pay roll that would get us out of debit!!!!!

Anonymous said...

"How can you take away ssi from everyone you are not looking out for us!!! but you can rebuild other Countries with our money people that have blown us up"

Stop voting for the same knuckleheads each election.

Anonymous said...
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Anonymous said...

It's simple in my mind.

Democrats= belief in,and concern for poor people and social programs such as social security.


Republicans= belief in,and concern for the wealthy therefore eliminate social programs

Anonymous said...

First: Anon 7:08 got it exactly.
Second: If the R's abdicate their responsibility and expect the President to raise the debt ceiling without them, then they should quit and go home. What use are they??? Do your jobs now.

Anonymous said...

http://market-ticker.org/akcs-www?post=189943

Don Levit said...

Anonymous who provided the market-ticker.org web site:
The author is correct that the total debt will not change by exchanging the $2.6 trillion in the trust fund on a one-to-one basis for new debt.
What this does is transform intragovernmental debt into debt held by the public, without raising the total debt.
Intragovernmental debt is debt owed by one government agency to another - the Treasury owes the $2.6 trillion to the Social Security trust fund.
While the debt remains as intragovernmental debt, interest can continue to be paid into the trust fund by issuing more of this special issue type debt.
However, when the intragovernmental debt is transformed into debt held by the public, interest will have to be paid from general revenues.
If there is not enough revenue to pay the interest,then the debt ceiling WILL have to be raised.
I don't know if this type of event has happened before. There are about 20 trust funds which comprise intragovernmental debt. I can see how many people could view this as a magical accounting trick, in which the government, in essence, has defaulted.
The original debt holder was the Treasury. Now, it's the public, with no increase in the total debt?
Come on!
Don Levit