As a 30 year old and fairly new real estate broker in 1979, I often lamented to my real estate brokerage partner, who was in his 50s at the time, that by the time I was old for social security, the program would be bankrupt, and that I would never collect a penny.
I really believed this in 1979, and I was wrong. My partner, who always responded: “Don’t worry, It will be there,” was right.
“How could it be there” was always my retort. In 1979, we had what seemed to be an incredible National Debt total (the national debt is the accumulation of the annual budget deficits), which was increasing and seemingly out of control.
Well, it was out of control, as is evidenced by today’s National Debt figures. In 1979, the National Debt was at $827,000,000,000 ($827 Billion). That number is too big for most people to comprehend. From 1929 until 1979, the U.S. national debt only grew gradually. It was just $16B in 1929 or about 16% of GDP, rising to $827B or 31% of GDP in 1979.
Today, the National Debt stands at $28 Trillion. A number to large to ever pay off…without a lot of inflation.
We can all count on more inflation as more money is dumped into the economy. Currently, the amount of money being debated in Congress exceeds 5 trillion dollars, yet the federal government continues to spend like a drunken sailor (a state of mind I remember well after spending 10 years in the US Navy).
But with all of that, and now, at age 72, I have been collecting my Social Security payments since I turned 66 years of age in 2015. How is this possible? Simple…creative accounting.
This site is an interesting tabulation (https://www.usdebtclock.org/).
So what about your Social Security? Janet Yellen, Secretary of the Treasury threatens: “Unless the debt ceiling is increased, “Nearly 50 million seniors could stop receiving Social Security checks for a time.”
That’s the kind of threat that intimidates and frightens voters. And yet it’s almost certainly an idle threat. Social Security’s broad political support and unusual financing structure makes it one of the least-likely programs to be placed on the chopping block, according to Andrew Biggs, a Senior Fellow at American Enterprise Institute.
Social Security, the debt limit, and the Washington Monument strategy