QUOTE (Brooklyn @ Feb 3 2006, 07:11 PM)
When talking of social security you have to factor in future payouts. Doing that makes social security a very large liability from an economic point of view. So payments to social security are, in no way, considered savings.
Depending, of course, upon the year one was born. My Dad got all his contributions, his employers' contributions, and compound interest back within less than 10 years, and collected benefits for 20. If I live as long as Dad did, I'll get my money back, likewise. People born after 1960 - surely after 1970 - have no reason to think they'll get theirs back.
Nevertheless, are there things left out of the formula that should be included.
Anyway, speaking of liabilities related to the economy, Social Security is basically unfunded because its 'safe deposit box' contains countless humoungous IOU's that the issuers can never repay. It was never funded properly, or actuarially. The bailout by Austin Congressman J. "Jake" Pickle in the mid-1980's has a shelf life of maybe 15 remaining years. We are stupid if we think that the people born in the 1990's are going to make enough FICA earnings, working at fast food joints, to pay for all the octogenarians, septegenarians, nonarians, and centennials (or other perennials).
Other immense unfunded pension liabilities of the US Treasury, not counted in the official national debt of 37,890 gigatrillion, include the military pension system, parts of the civil service pension system, etc. And public pensions are so poorly funded that the government bailout insurance program is facing its own deficit.
Would it have been to much to ask, back in 1954, for the government of the USA to stop having a negative savings rate?
