Once more: for every asset in the Social Security Trust Fund, there is a liability for the US Government. In other words, for every liability in the intragovernmental debt, there is an asset in a trust fund.
And I repeat: did you oppose the Bush tax cuts because they were intended to return the surplus to the taxpayers?
Regardless of how you think it should be calculated, that’s not how it’s calculated. The deficit is the difference between spending and revenue.
The debt on the other hand includes intragovernmental debt. One part of the government owes money to another part of the government. You can accumulate intragovernmental debt even if the total government revenue is equal to or greater than the total spending.
You seem to be saying “Those terms should not be defined that way.” Regardless, though, they are defined that way.
I opposed them because it was not a good time to cut taxes.
Those junk numbers are used by Washington to hide how fiscally irresponsible they have been with your money. Inaccurate and misleading.
If the federal government only had a $455 billion deficit in FY 2008, why did it need to barrow over $1 trillion that year?
And so you oppose R-Money’s tax cuts too, right?
We’ve done this in threads before, and yes, Enron-style accounting works this way.
If I have a $20 bill in my pocket and spend it, but make sure to write myself and IOU for $20, under your theory, I would still have $20 because my IOU (to myself) is an asset. But where would I get $20 to pay myself back? Through work or investment income: Exactly the same way that I would get $20 without the IOU.
In the same vein, the government treasury bonds that the SS trust fund holds as an “asset” must be paid back by either borrowing more money or taking in tax revenue. Which is the same way it would be funded without the treasury bond.
You can split anything into separate accounts, create balance sheets for each and show how one is doing great. But if they are all functionally the same entity (i.e. The US Government) then it’s absurd to use such a method.
Tell me how the “assets” in the SS Trust Fund are any different than the trust fund having absolutely nothing there. A promise to repay yourself is not an asset. Even if you are an honest, upright citizen who really WILL repay yourself.
It’s “borrow” by the way.
But the same people who squeal about the U.S. having 16 trillion in debt also want to count it as a major crisis when Social Security runs a deficit. That shouldn’t impact the 16 trillion in debt at all, until the trust fund runs out. Just more of the debt will be shifted to the public. It’s sort of like the old “but what happened to the extra $1?” riddle.
Because the highest law in the land guarantees that the bonds must be paid. Enron can declare bankruptcy and screw it’s creditors. The United States Government is constitutionally prohibited from ever doing such a thing.
Is that a good enough reason for you?
So what would you call that, a $20 deficit, break even, or a $20 surplus? When you write an IOU, the person who receives it can count it as an asset, and you should keep track of it as a debt.
You started with $20. You end with whatever thing you spent the $20 on, an IOU worth $20, and an obligation to pay $20. I would say you broke even.
If I’m following this all correctly, moonshot and OMG are trying to call this a $20 deficit. The debt is $20, and they’re not accepting that the government (in a different account) now holds an asset worth $20 that it didn’t have at the beginning.
Would someone let me know if that’s remotely close?
Can you explain why everyone - democrats, republicans, lawyers, accountants, and so on - have been lying about this since forever? Bonus question: what qualifies you to declare that the way accounting works and has worked since “accounting” was invented as a concept is false and doesn’t work?
I hope in considering this question it gives you pause, but I somewhat suspect it won’t.
Seriously? You think you know better than the Congressional Budget Office?
I’ll make my example even simpler: I spend $20 today on something, anything.
I then do one of two things:
Nothing.
Prepare a statement, that I notarize, promising to pay myself back $20.
Explain how option 1 or option 2 is different in any functional way.
Was there something confusing about my first response?
This reminds me of a friend who sneers when anyone points out that the recession is over. “Bullshit!” he screams. “Look at the unemployment figures! Just try to convince me the recession is over!”
He doesn’t know the definition of the word.
(I wish this were only a conservative problem, but my friend is a fire-eating liberal. So it goes.)
The deficit claim, estimate or projection put out by the CBO is always much lower than the real national debt increase in the fiscal year.
So basically, words should mean whatever you say they mean. Got it.
I think it’s safe to assume that the numbers the CBO is using for 1998 are not projections.
Can you explain why everyone - democrats, republicans, lawyers, accountants, and so on - have been lying about this since forever? Bonus question: what qualifies you to declare that the way accounting works and has worked since “accounting” was invented as a concept is false and doesn’t work?
I love it when people really stick to their guns even though they have been proven wrong by a simple definition.