Homestead mailing list

[Clansgian AT wmconnect.com]

> 
> >In the seventies my world-wise cronies and I talked exactly that same  
> talk, even fully sober. ......
> 
> >Part of the optimism is nostalgia colored by bad or selective memory.


Indeed, because in the 70's SS was for sure headed for insolvency.

Geezerdom of today likes to say, "We thought SS was going to tank and we were 
wrong.  So it's the same today, everyone points to the insolvency of SS but 
it will be just like it was in the 70's and in the end it will be OK"

Not this time.

In the 70's SS was headed for insovency and that was thwarted by a massive 
increase in the SS tax.  So massive an increase that it created a surplus.  
The 
US govenment can't hold onto the money in the form of savings (it is illegal) 
so instead they loaned the money to the general revenue.  This created 
massive 
amounts of obligation based on the SS taxes that were being collected.  And 
now those obligations are becoming due.

SS tax can't go up that much again, that was a one time squandering of the 
country's resources.  Obama's removal of the the cap would only amount to a 
drop 
in the bucket.

The way all countries and economies in history have handled this  is to let 
inflation run wild and not increase the face amount of the benefits.  COLA is 
a 
problem with that, but not a difficult one.

James   </HTML>