Pull Up a Chair, Let's Watch the Titanic

We Will Need Honesty to Solve Debt Problem

These financial shenanigans were no mystery to Mr. Lew when he was director of the Office of Management and the budget under President Bill Clinton. In OMB's official commentary on President Clinton's budget for Fiscal Year 2000, he wrote on page 337 of Analytical Perspectives,
"These [trust fund] balances are available to finance future benefit payments and other trust fund expenditures--but only in a bookkeeping sense. These funds are not set up to be pension funds, like the funds of private pension plans. They do not consist of real economic assets that can be drawn down in the future to fund benefits. Instead, they are claims on the Treasury that, when redeemed, will have to be financed by raising taxes, borrowing from the public, or reducing benefits or other expenditures. The existence of large trust fund balances, therefore, does not, by itself, have any impact on the Government's ability to pay benefits."
Lew was right in 1999, but not today. Social Security is not self-financing. In 2010, the government borrowed $37 billion to fund the program. Over the next decade we will borrow $547 billion to pay benefits.

It's fascinating, it's like watching two ships collide, or the Titanic (in the movie), unable to turn fast enough to avoid the iceberg.  There's medicare and SS, both on a disaster course, and the president is talking about throwing pennies at "clean energy" and setting arbitrary goals for how much of it we have to have by some future date.  In a sense, I can't wait to see what the heck finally happens, and which generation is going to have paid 15% of their working lives to these programs, only to see the benefits evaporating as they near retirement.  It will be an echo of the Delta pilots, and Enron employees, and perhaps other epic big corporation bankruptcies, employees of which lost their retirements - the main difference being, the pilots at least chose who they were entrusting their futures to, and could perhaps have seen it was absurd to both expect the company to be solvent and take an adversarial relationship to the company at the same time (the miracle of millionaire pilots with a union).

I have this unrealisitic sense that if any of them had a conscience, they would all refuse to do anything until they could choose a plan for solvency in the "entitlement" programs.  Realistically, the nation's insolvency is not the primary problem for anyone currently in office, getting re-elected in the aftermath of a recession is.  Which is why it was madness to have allowed politicians to have the power to create such destructive spending programs in the first place.