I agree with that sentiment.
And that goes all the way around, only it's a lot more serious than the rank hypocrisy of our Speaker of the House.
In fact, the Big 3 management teams and congress have made almost identical mistakes in the last 50 years. Philosophically, both have lived on short business/political cycles that promote short term fudges rather than long term solutions; all while executing long term plans that always outspent revenues. Gamblers suffer from the same eternal optimism even in the face of economic reality: the difference being the inveterate gambler has a day of reckoning that may involve a kneecapping instead of a bail-out check. Pain and the threat of death: the self-checking mechanism that prevents gamblers from running up trillions in debt.
I can see the wisdom in that system.
The thing that has surprised me is the absolute silence on social security solvency, even as we have just watched the perfect model for how big programs collapse. Will a future congress and president fain surprise when the first whispers emerge that social security checks will start getting smaller?
The government has been lying about social security for years, so that much is not new. What is new is the perspective provided by the financial collapse of the government-private mortgage industry. If this isn't THE needed wake up call to take a longer view then we surely won't hear another.
The big lie is exposed in this Government Accounting Office.
Social Security’s benefit costs will soon start to grow rapidly. In 2017,
Social Security is projected to pay out more cash in benefits than it receives
in revenues.1 As figure 6 shows, after that time, the gap between costs and
income grows continuously, and, unless action is taken to close this gap, the
trust funds will eventually be depleted in 2041.
Right now, the surplus is used to fund other parts of the government, so 2017 is a much scarier date than it would appear on the face of it.
Here's the money shot.
Starting in 2017, the Treasury Department will begin to redeem
trust fund securities in order to continue to pay full promised benefits.
Specifically, in order to convert the Trust Fund securities into cash, the
government will require increased government revenue, increased borrowing
from the public, or reduced spending in the rest of the government.
When the Treasury has to redeem securities some very tough things will happen. The GAO's projections are that everything (value of securities and willing buyers) will continue as normal for 40 years. That is the same kind of thinking that backed the sales of mortgage backed securities...i.e. that the value of homes would never go down for any length of time. We just saw what happened to those kind of eternally optimistic projections.