I really want to understand, so please have patience, Max.
On Wed, 10 Feb 1999, Max Sawicky wrote:
> Whether debt is paid down or not, after 2013 (according
> to projections) the Feds will have to raise taxes that
> will end up financing Social Security benefits.
Just to make sure I'm following: we could just let the debt rise back to where we paid it down, right?
> The difference between Clinton's scheme and a simple
> debt pay-down is that in the former case, these
> same taxes would redeem bonds held by the Trust
> Fund before being paid out as benefits. Without
> the scheme, the money would just shoot through the
> Trust Fund and pay benefits directly.
I'm not sure if I understand this or not. Are you saying that in a normal paydown, Govt. gives pays back a billion dollars it owes the Social Security Trust Fund. But in Clinton's plan, Govt. pays back a billion dollars, and then borrows it again, and then pays it again -- so that the balance sheet is still a billion dollars to the good? In the unlikely event I've understood, what's the point?
>
> With a pay-down, taxes would be used pay off debt and pay
> benefits. Current projections say there's enough tax
> revenue to do this for 50 years or so, since surpluses
> are projected that far into the future (further, with
> different assumptions).
I'm sorry, didn't you just say
> Whether debt is paid down or not, after 2013 (according
> to projections) the Feds will have to raise taxes that
> will end up financing Social Security benefits.
They can't both be true, can they? Or am I misunderstanding again?
Michael
__________________________________________________________________________ Michael Pollak................New York City..............mpollak at panix.com