JimGant

My last two transfers -- in May and June -- were for $25000 each. And both took seven days. Both to Bangkok Bank; ACH "pull" from USAA checking acct. Just did a couple dummy runs with Wise, and seven days is still the advertised timing -- at least for amounts above $2300 (two days for lesser amts). Can't send more than $50000 with ACH (Maybe with a "push." By I'm not set up that way).

Maybe this Cato blog will answer your question. https://www.cato.org/blog/social-security-spending-adds-national-debt#:: A quote from the blog:

Nope, just markers -- but not assets to the US govt.

Well, duh, you have a negative cash flow situation -- are you short on mathematical skills? To accommodate this cash shortfall, the Treasury has to turn to selling bonds to the public -- since we haven't been in a positive tax collection situation since Clinton. And, so, national debt increases proportionally. The value of the Trust fund just represents how much the Treasury owes the Trust fund for loaning its excess cash in years prior. It's not an asset, like gold or Sovereign Trust Fund -- it's just a marker for how much the Treasury owes the Trust fund. Here's where you and Bernie get confused.... Intragovernmental debt is a zero sum game. That's literally a paper tiger. Those IOU's are NOT an asset, like gold or dollars under a mattress -- they're just a legal reminder of what the Treasury owes the SS Admin. Those excess FICA dollars went internally to US govt assets -- not externally, where, in the future, they could be recouped WITHOUT affecting the US debt picture. Intragovernmental debt is an entirely different animal than public debt -- loaning to yourself ain't the same as loaning to Ahso Wong. Actually, those opinion pieces, like from Cato, certainly have a lot more credence than your representations... You have? Please refresh my memory. A nicely written article on how the Trust fund affects national debt would be nice.

Let me see if I’ve understood all you’ve said/implied: The billions in negative cash flow by the SS Admin since 2010 has NOT increased the annual deficits, because the dollars the Treasury had to borrow from China were zeroed out – in accounting terms -- one for one, by the redemption of Trust fund IOU’s. Thus, you’re of the Bernie Sander’s school of accounting, where the negative cash flow, paid by Chinese dollars, isn’t a problem because the Trust fund doesn’t run out of IOU’s until 2033 or so. Thus it just doesn’t matter that the public deficit has increased by those Chinese dollars, because those Chinese dollars have cancelled an equivalent amount of intragovernment debt. So, rest assured by the likes of a pinko like Bernie Sanders. Now the Cato school of accounting says, hey Houston – we have a problem. And we can’t wait until 2033 to address that problem – the billions in negative cash flow is occurring now – resulting in a public deficit increase equivalent to those Chinese dollars having to be borrowed. That Bernie Sanders, and other fools, believe the Trust fund has equivalent value to those Chinese dollars – is confusing reality with accounting methods. Thus, the only way to present the very real problem is to NOT include intragovernment debt into the equation. Then, maybe Congress will get the message to act now, because the Trust fund really doesn’t give you until 2033 to act. Or do you, like Bernie, believe this negative cash flow since 2010 – doesn’t represent a problem – because the Trust fund hasn’t run out of IOU’s? Too bad the Trust fund didn’t invest their surplus dollars in gold, or a Sovereign Wealth Fund; then we wouldn’t have to have this discussion.

No, because they know that intragovernmental debt is a non player when it comes to reporting a meaningful deficit number. And that only public debt, e.g., those bonds sold to China should be considered. In your example, having to sell $70B to China to cover the SS benefit cash flow shortfall -- means nothing, because it is matched dollar for dollar in the drawdown of Trust fund IOU's. So, on your accounting worksheet, there's absolutely no increase in deficit -- meaning, it makes no difference whether or not the Trust fund is running a cash flow shortfall -- or a cash flow surplus. But, of course, it does make a difference. So smarter people use different accounting worksheets. By the way, intragovernmental debt is recognized as a number that need be sidestepped in certain situations -- to get to a meaningful position. Such is the case when it comes to the debt ceiling -- where the intragovernmental debt represented by the SS Trust fund -- is excluded.

The SSA wouldn't invest in a new T-bill without positive cash flow -- the SSA pays out its total cash flow in to beneficiaries -- then cashes in its IOUs for the cash deficit payout required -- then with that cash, makes the additional payout required. But, these mechanics are incidental to the scenario at hand... ....which is: the Trust fund is just an accounting entity, trying to match cash flow in with cash flow out -- to make sure Social Security pays for itself. What's going on now, and since 2010, is: It isn't paying for itself, when you look at cash flow in vs. cash flow out. That the Trust fund has a nice fat surplus number in paper IOU's, for now -- doesn't mean squat. This whole drill is about cash flow. So, based on cash flow, the SS Admin has to borrow from the Treasury -- and the Treasury has to get that cash from selling Treasuries to the public. So, based on cash (necessarily so), the deficit increases by the amount the Treasury needs to borrow from the public; but it DOESN'T decrease -- on a cash basis -- by any IOU's zeroed out for the Treasury infusion to the SS Trust fund. Back to the basics. The Trust fund is purely an accounting entity. Its existence in no way affects that the SS Admin has a cash flow shortfall, and, fortunately, can call back that cash it loaned years ago to build aircraft carriers. This is what's going on now (since 2010). And, for sure, this increases the deficit - in cash terms (in return for decreasing the deficit back in the years loaned for aircraft carriers). But, an accounting entity, with non cash IOU's -- cannot be matched one for one with Treasury sales, for cash, to the public. So, let's stick with cash flow -- for a balanced discussion.

So, the real question is: What's the definition of debt? I guess that sums it up....it comes down to accounting vs. reality. I agree with Cato, that the increase in public debt due to cash flow deficits is the key factor -- not that, when netted with intragovernmental debt (those Trust Fund IOU's) that there is no increase in debt. That conclusion just papers over the fact that negative cash flows ARE a problem. Anyway, probably time to move on.

So you're saying the following is BS?

gambooler, please critique the below article, as it parallels what I've been saying. Please note that the article points out that Bernie Sanders doesn't understand how the system works either -- so you're running with some interesting company. https://www.cato.org/blog/social-securitys-41-trillion-hidden-government-deficit One germane quote from the article:

Thank you. Love our northern cousins, having worked in a US-located NORAD command post for four years, where it was one/third Canadian. The CF-101 squadron at Comox, on Vancouver Island, had the world's best, and rowdiest parties. A quick flight from our HQ at McChord AFB in Washington.

I think you've gone completely off track. Of course the SS trust fund holds those special T-bills, or IOU's. But when, since 2010, the SS trust fund finally had a negative cash flow, and needed to convert some of those IOU's to hard cash -- it went to the Treasury with the number of IOU's needed for said cash. And, yes, the IOU's from 2010 to 2021 represented net interest earned on the principal (only after 2021 did the IOU's start dipping into principal). But that makes no difference in the argument, except it kept Trust fund principal above water -- for accounting purposes -- until 2021. So all the uninformed believed the Trust fund was above water until 2021, never knowing negative cash flow has required -- since 2010 -- the Treasury to pay out billions in cash to SS beneficiaries. And to legally have to do so until the gimmick Trust fund runs out of principal in 2032, or whenever. And am I "implying that the Treasury had to increase the amount of T-bills sold" -- of course I am! How else can the Treasury get the hard cash to pay off the Trust fund IOU's -- other than by selling T-bills to Joe Blow or Ahha Wong -- since there haven't been any positive tax collections in decades. And will all these annual payouts for cashed in IOU's increase annual deficits? Yep, dollar for dollar. So, the Trust fund is, indeed, a "dirty little secret." So, SS payouts, since 2010 -- and until the Trust fund runs out -- have required the public to buy T-bills. That the Trust fund remains solvent until 2032 -- only means the Treasury is legally required to redeem the Trust fund's IOU's for hard cash. And thus equivalently, increase national debt. Why we try to represent the Trust fund as something it is not -- is beyond my reasoning. Anyway, I had hoped my reference article on the "dirty little secret" would finally open your eyes. That you dismissed it as a presentation by a political hack -- says more about you than him. We're on different frequencies. Probably time to retire.

So what? We're talking cash flow; that this year's interest, represented by IOU's, increased the value of the Trust Fund is just fine and dandy for accounting purposes. But, come 2010, the Treasury finally had to trade some Trust Fund IOU's for hard cash, to make up for the short fall in benefit cash payout. And the Treasury, since it was negative on taxpayer inputs, had to borrow from the public for this cash to pay to the Trust Fund. Thus, an increase in the deficit in 2010 -- unless you believe IOU's for annual interest are the same as hard cash..... Nope. It had to borrow more in 2010 -- and more ever since, because the Trust Fund had to cash in some IOU's to get hard cash to cover the cash flow deficit. And the Treasury had to come up with that cash. Had things been as before 2010, when the Trust Fund traded its excess cash to the Treasury for IOU's -- well, in this case, the Treasury has to borrow less from the public, because of that cash infusion from Social Security. Now, if the Trust Fund was invested in gold, a Sovereign Fund, or in a mattress -- yeah, the Treasury would "borrow that same amount regardless of what the SS trust fund does with its capital." But, that's a whole different scenario from what we're talking here. Huh? IOU's don't mature. They, post 2010, just finally get exchanged back into the hard cash originally loaned to the Treasury. 'Til 2032, no more owed to the SS trust fund. The accounting gimmick has expired, now what boss? Oh, just keep paying the shortfall; we'll just add it as another line item short of funding.

No, better to point out the year that cash flow out exceeded cash flow in. And that "dirty little secret" would be 2010. And because the country was in deficit, the Treasury had to borrow from the public the cash to make up for that cash flow shortfall. Thus, 2010's deficit increases accordingly. So too deficits in years afterwards. And, of course in accumulation -- the national debt. Yes, the books show that the SS Trust fund actually increased 'til 2021, since total interest IOU's accumulated during those years actually totaled more than the interest IOU's cashed in to the Treasury to pay for the cash flow shortfall. But since 2010, and every year hence, the Treasury has had to add to the national debt -- by selling Treasuries to the public to pay back those SS IOU's. Now, with interest IOU's no longer able to cover cash flow shortfalls -- IOU's of principal are having to be redeemed by the Treasury -- and this accounting number will be depleted in 2032 -- or earlier. But forgetting the accounting slight of hand being played here, just concentrate on the cash, since 2010, that the Treasury had to borrow from the public each and every year -- and will be legally obligated to borrow until the Trust Fund runs out in 2032, or abouts. (I say legally obligated because those IOU's are legal obligations.) But, what if Congress says post 2032 -- hey, we've been providing for the cash flow shortfalls since 2010. Why not just continue paying out those cash shortfalls for the public good (i.e., not having benefits reduced) -- since the Trust Fund is just an accounting gimmick..... Anyway, something like that will surely happen -- and maybe the Trust Fund will go away and copy Social Security's SSI payments, which are strictly a line item from general revenue.

Here's a well-written explanation that maybe gambooler can understand. https://thehill.com/opinion/finance/5364519-social-security-trust-fund-debt/