Real federal deficit dwarfs official tally
By Dennis Cauchon, USA TODAY
The typical American household would have paid nearly all of its income in taxes last year to balance the budget if the government used standard accounting rules to compute the deficit, a USA TODAY analysis finds.
Under those accounting practices, the government ran red ink last year equal to $42,054 per household — nearly four times the official number reported under unique rules set by Congress.
A U.S. household’s median income is $49,445, the Census reports.
The big difference between the official deficit and standard accounting: Congress exempts itself from including the cost of promised retirement benefits. Yet companies, states and local governments must include retirement commitments in financial statements, as required by federal law and private boards that set accounting rules.
The deficit was $5 trillion last year under those rules. The official number was $1.3 trillion. Liabilities for Social Security, Medicare and other retirement programs rose by $3.7 trillion in 2011, according to government actuaries, but the amount was not registered on the government’s books.
https://www.usatoday.com/news/washington/story/2012-05-18/federal-deficit-accounting/55179748/1
Social security IS a Madoff scheme. In any private retirement plan, your pension money must MAKE money in order to be sustainable for future payouts. The US Government has IOU’s in the so-called SS trust fund which earn 1%. Without workers contributing to the fund, the payouts would rely solely on the government to borrow money to pay the benefits. The last time I checked, the number of workers is falling – not rising as the U3 unemployment would suggest. They just stopped counting the people who dropped out of looking for a job. Once again, the government plays by a different set of rules than they make for us citizens. If we ran our businesses like this, we’d be bankrupt and if we ran our households like this, we’d be poor and destitute.