Real 2011 Deficit Was A Huge $5 Trillion

Sunk by entitlements!

By Dennis Cauchon, USA TODAY

Under (standard) accounting practices, the government ran red ink last year equal to $42,054 per household — nearly four times the official number reported under unique rules set by Congress.

A U.S. household's median income is $49,445, the Census reports.

The big difference between the official deficit and standard accounting: Congress exempts itself from including the cost of promised retirement benefits. Yet companies, states and local governments must include retirement commitments in financial statements, as required by federal law and private boards that set accounting rules.

The deficit was $5 trillion last year under those rules. The official number was $1.3 trillion. Liabilities for Social Security, Medicare and other retirement programs rose by $3.7 trillion in 2011, according to government actuaries, but the amount was not registered on the government's books.

Deficits are a major issue in this year's presidential campaign, but USA TODAY has calculated federal finances under accounting rules since 2004 and found no correlation between fluctuations in the deficit and which party ran Congress or the White House.

Key findings:

•Social Security had the biggest financial slide. The government would need $22.2 trillion today, set aside and earning interest, to cover benefits promised to current workers and retirees beyond what taxes will cover. That's $9.5 trillion more than was needed in 2004.

•Deficits from 2004 to 2011 would be six times the official total of $5.6 trillion reported.

•Federal debt and retiree commitments equal $561,254 per household. By contrast, an average household owes a combined $116,057 for mortgages, car loans and other debts.

http://www.usatoday.com/news/washington/story/2012-05-18/federal-deficit-accounting/55179748/1

 

Social Security is an easy fix. The current cap is $110,100.00 Under the Reagan plan the cap was designed to hit 90% of wage earners. The Reagan plan! The cap now hits about 84% of wage earners. Raising the cap to $191,000 would extend the drop dead date from 2037 to 2049. This would be in compliance with the Reagan plan. You know, that God like person the "fiscal conservatives" so often adorn. Self proclaimed fiscal conservative Ryan objects to that plan.
The obvious long term fix is to eliminate the cap altogether and MANDATE that the SSN fund is to be used for paying SSN benefits, and nothing else. Done! Next problem!
http://www.thefiscaltimes.com/Blogs...the-Social-Security-Wage-Cap-Issue.aspx#page1

 

Let's call that idea what it really is not hide behind the word "cap".

So, your answer is to raise taxes 12% on all income over $104,000? And, that's just to solve the Social Security shortfall. Brilliant. NOT.

 

No, my answer is to do what Reagan would do, and then mandate the money cannot be embezzeled. Raises revenues while limiting spending. Reagan would love it. Why don't you?

 

Because it is a heafty tax on a large segment of the population. I don't want to see another tax raised until the government stops spending.

Besides, when has the Congress ever not spent the money in the SS trust fund?

Stop the spending first, we'll talk about raisiing taxes later.

 

Hence the mandate to no longer embezzel the money. I agree that until spending is controled, no fix will work. However, more revenue needs to be generated to accomodate a growing/aging/crumbling country, and to dismiss that fact as a non-starter is burying our heads in the sand.

 

I don't agree on raising ANY taxes until Congress stops the spending.

We've tried raising taxes many times in the history of this nation. We have NEVER reigned in the spending. We can't even reign in the growth of spending which is the only thing Congress even discusses.

NO MORE TAX INCREASES!

 

We, as a nation, should not get in to a you go before I go argument on this issue. These things can be done simultaneously. I would argue they must be done simultaneously to have any chance at all for economic success.

 

Nonsense. That is a typical liberal red herring.

 

Well, then we're in for a hard road cause Dem's like me ain't rolling over for the whole taxes will kill jobs argument. It's bullshit! This privatized profits for the boardroom boy's, socialize the pain of losses on the working class is bullshit!