Wake Up! We're Screwed
Posted: Wed May 30, 2007 8:13 am
The last I heard Social Security has been running an operational surplus of a few hundred billion a year since the early 1980s.
this surplus is routinely pocketed and distributed to other federal operations, so it partially masks the annual Federal Deficit.
Reagan and Greenspan's big trick was to try paying for their top-tier income tax cuts with a massive increase in social security taxes. The increase in social security tax rates was a regressive income tax increase. At least, that is how Ravi Batra explains it.
The endemic federal budget deficits began in earnest in the early 1970s. In the early 1970s we finally arrived at our goal of being a "free trade" nation. Our un-traditional promotion of reducing trade barriers and subsidizing capital and production flight finally reached its ultimate (real) conclusion. It's just something that doesn't work, but they'll keep making up reasons to pretend it works.