gamb00ler

I console myself that a good percentage of my net worth will stay in some investment until I die, meanwhile I can't use any of it... unless I somehow can accurately predict my demise well ahead of time.

CATO insists that OASI funds held as GAS are not 'real money'. That is not true. Those GAS were purchased with real money sent to Treasury from FICA tax collections. Now, Treasury is paying out SS benefits using the real value held as GAS by OASI. CATO is very disingenuous by stating such an opinion. Somehow CATO has the insane notion that the act of purchasing a GAS and then redeeming it somehow makes the funds not 'real money'. And you believe this? Try to explain this theory to the T-bill (only slightly different than GAS) holders and you will be the butt of much laughter.

You requested that I provide links which prove that the current shortfall in SS cash flow does not increase the NATIONAL DEBT. To prove it, you only need to know two facts. FACT 1 is the true definition of NATIONAL DEBT as stated on a Treasury.gov web page: https://fiscaldata.treasury.gov/datasets/debt-to-the-penny/debt-to-the-penny The Debt to the Penny dataset provides information about the total outstanding public debt and is reported each day. Debt to the Penny is made up of intragovernmental holdings and debt held by the public, including securities issued by the U.S. Treasury. Total public debt outstanding is composed of Treasury Bills, Notes, Bonds, Treasury Inflation-Protected Securities (TIPS), Floating Rate Notes (FRNs), and Federal Financing Bank (FFB) securities, as well as Domestic Series, Foreign Series, State and Local Government Series (SLGS), U.S. Savings Securities, and Government Account Series (GAS) securities. FACT 2, is that every redemption of a Treasury obligation (debt) reduces the NATIONAL DEBT. I hope this doesn't need proving. Obviously when a debt is paid off the total debt owed goes down. SSA is currently redeeming the GAS securities it holds in OASI to cover the shortfall. Fact 2 proves that such a redemption eliminates the Treasury's obligation for that particular GAS. The Treasury, knowing that a redemption of a GAS is imminent will sell T-bills in the amount required. Temporarily the NATIONAL DEBT increases by the amount of the sales required to complete the redemption. When the GAS is redeemed the NATIONAL DEBT is reduced by the dollar amount of the redemption. At the completion of this two-step process, the NATIONAL DEBT is unchanged since the sale and redemption are for the same amount. The sequencing of the T-bill sale/GAS redemption may be flexible because I'm sure the Treasury has a sizeable float available to make such linked financial transactions flow smoothly. After a couple of more searches and a lot of reading, it appears that the definition of 'public debt' used by the Treasury DOES include the GAS that are held in OASI. https://fiscaldata.treasury.gov/datasets/monthly-statement-public-debt/summary-of-treasury-securities-outstanding

You continuously state that the shortfall in SSA income is increasing the NATIONAL DEBT. Your statement would be true if you claimed the shortfall was increasing the 'public debt'. I NEVER claimed the 'public debt' was not increasing. But in reality the 'public debt' was artificially decreasing during the baby boom decades and NOW the 'public debt' is reverting to a more realistic number as the OASI depletes. That change is NOT a problem... it is a feature of the design of OASI. CATO should just stay away from comments about the 'public debt' and focus on the actual problem... which is the flawed actuarials used to determine SS benefits vs funding. The 'public debt' number really only has relevance over a relatively short period of time. That time period started when OASI began growing and ends when OASI is depleted. Outside that time period the 'public debt' will not differ much from NATIONAL DEBT because intragovernment lending didn't or won't exist.

Amazing... your hindsight is 20/20. Maybe you don't realize that sometimes the Western/Thailand exchange rate moves in favor of the Western currency?

Well then.... the decrease in 'public debt' due to the OASI excess is exactly offset by the increase in 'public debt' as OASI is depleted.... it can't be anything but an equal but opposite effect.... or as they say.... it's a wash. The amount of principal out of the OASI exactly equals the amount of the principal into OASI in the boom years. Of course the grand total out is greater than the total in because of the decades of interest accrued. The amount of that interest is identical (or insignificantly different) than the interest the Treasury would have paid out if those SS T-bills were instead owned by the public. What facts are you in possession of that make any of those statements false?

Still towing the CATO line.... sad. I bet you don't even read the links I provide that disprove CATO's opinion. That would hurt your feelings too much.

The public debt increase is solely caused by its remarkable decrease during the years when the FICA taxes were pouring in and building up a huge excess that shifted the government's borrowing to intragovernmental loans. If that excess didn't happen... then obviously the 'public debt' couldn't increase from the artificially low levels created by OASI excess funds. Without the huge buildup in OASI lending.... the 'public debt' would be almost 100% of NATIONAL DEBT. So if you truthfully believe that the decline in OASI trust fund is 'bad' and causing trouble then you must accept that the huge buildup of OASI in the baby boom years was 'great'. When OASI lending stops.... the NATIONAL DEBT will be near 100% 'public debt'.... which it would have been if SSA were never created. As for your promulgation of the notion that CATO's intent is to bring attention to the impending SS benefit reduction upon the demise of OASI funds.... that is just hogwash. Many much better informed sources have been blasting out the facts on SS shortfalls without the extreme angst that CATO is injecting into the topic.

A very simple explanation of the effect created by the shortfall in OASI income just occurred to me. The depletion of OASI is simply the unwinding of the 'benefit' that the excess FICA collections created in the baby boom years. When OASI is depleted US will return to 'normal'. The NATIONAL DEBT will be almost identical to the 'public debt'.

Yes... because instead of the 'public debt' total being held down by the influx of the excess FICA taxes, Treasury would have had to sell T-bills to the public... Consequently, the 'public debt' would have been higher for decades. But of course.... through out all those years the total NATIONAL DEBT would be unaffected...... because the NATIONAL DEBT consists of both intragovernmental and public debt. You're really embarrassing yourself by ignoring all these obvious effects. I'm glad you created your parable and asked this question. The answer to your question clearly illustrates that CATO's obsession about the 'public debt' is a very red fish.

You keep forgetting that when ANY T-bill holder redeems it.... the US NATIONAL DEBT is reduced. Absolutely an indisputable FACT. So when SS redeems one of their special T-bills, the NATIONAL DEBT is reduced. But I do agree with you that the Treasury must simultaneously sell a new T-bill to the public to raise the cash required to redeem said SS T-bill. Reduction of NATIONAL DEBT through T-bill redemption is offset by a new T-bill sold to the public which does increase the 'public debt'. NATIONAL DEBT includes both intragovernmental and public debt. Therefor the NATIONAL DEBT does not change. The only thing that does change is who receives the interest and principal repayment from the Treasury. The Treasury owes the same interest and principal after as it did before. From Wikipedia https://en.wikipedia.org/wiki/National_debt_of_the_United_States The national debt can also be classified into marketable or non-marketable securities. Most of the marketable securities are Treasury notes, bills, and bonds held by investors and governments globally. The non-marketable securities are mainly the "government account series" owed to certain government trust funds such as the Social Security Trust Fund, which represented $2.82 trillion (~$3.45 trillion in 2023) in 2017.

You're egregiously misstating Mr. Sanders position on SS. He has long been aware of the fast approaching depletion of OASI. But... he does agree with my opinion that the current shortfall in SSA cash flow is NOT increasing the NATIONAL DEBT.

I got a TIN in CM in 2021. I knew I would probably never owe Thai tax so I wasn't worried about the TRD 'knowing' about me. I took my passport, certificate of residency and a bank book showing tax being withheld from my interest to the Chiang Mai Area Revenue Branch Office 1-2: https://maps.app.goo.gl/STtj8AuitbeZJFGV8 it took about 20 minutes from start to end.

Yes... and you're headed in the wrong direction. I have provided plenty of evidence to support my explanation.... and you have provided what? The OASI did provide cash to the Treasury, but obtained essentially T-bills in return. Now OASI is redeeming those T-bills for cash. Completely normal transactions that happen between any T-bill purchaser and the Treasury. Absolutely no qualitative difference from public T-bill useage. You're out to lunch.... but I'll read any link that you provide as long as it comes from Wikipedia, congress, Treasury or SSA. No opinion pieces will be accepted or read.

You must have the same brain worm as RFK had. You parable is way off. In your story, there was no obligation created by the Treasury. In real life there was. Each and every special T-bill held by OASI is truly a Treasury obligation. That is the why your little story is worthless. You keep forgetting that when ANY T-bill holder redeems it.... the US NATIONAL DEBT is reduced. Absolutely an indisputable FACT. So when SS redeems one of their special T-bills, the NATIONAL DEBT is reduced. But I do agree with you that the Treasury must simultaneously sell a new T-bill to the public to raise the cash required to redeem said SS T-bill. Reduction of NATIONAL DEBT through T-bill redemption is offset by a new T-bill sold to the public which does increase the 'public debt'. NATIONAL DEBT includes both intragovernmental and public debt. Therefor the NATIONAL DEBT does not change. From Wikipedia https://en.wikipedia.org/wiki/National_debt_of_the_United_States The national debt can also be classified into marketable or non-marketable securities. Most of the marketable securities are Treasury notes, bills, and bonds held by investors and governments globally. The non-marketable securities are mainly the "government account series" owed to certain government trust funds such as the Social Security Trust Fund, which represented $2.82 trillion (~$3.45 trillion in 2023) in 2017.