It's a short item from Waldo's Political Blogroll from Thursday night. But the headline show the deep trouble we're in.
Social Security Isn’t the Problem
The fact is, Social Security holds U.S. bonds that are the U.S. government is no more likely to default on than they would China’s.
Social Security is broke because the money has been spent. By Democrats and Republicans over the past 30 years.
There's no money, just IOUs.
What's going to pay the IOUs? Several unappealing possibilites.
Inflation. If you owe a $1 million dollars, but inflation makes a million dollars worth of items cost $2 million, then the government can feel it's met the obligation while the people suffer.
Today's youth - unborn during the times when Social Security ran a surplus - will pay higher taxes to support those who spent the money in the first place. And likely never see any of that money for themselves.
That's not going to go well for the younger generation.
Because if they're paying higher taxes, they won't be buying stuff. They won't be buying your house when you want to retire and enjoy your golden years.
Budget cuts now are the only way to provide hope for the future. Trimming the rates of growth should have been done 15 years ago, but it was just a crisis in the future.
The future is closer than you think.