Is the United States going to go broke?

Question

Is the U.S. going to go broke because of all of the immigrants and illigal immingrants making money here and then sending their U.S. money to other countries rather than keeping it here and because they are giving immigrants and illigal immigrants social security even if they have never paid any in???? This is kinda scary when you think about it.

The reason I ask is because this was discussed the other day when I was eating lunch with a group of people. Some seemed to think this was going to happen eventually.

Answer 1

When immigrants send dollars to their home countries, those dollars can only be spent here - The families of the immigrants exchange the dollars for their local currency and the person who receives the dollars either spends them in the U.S. or loans it to someone in the U.S. (such as the U.S. government) - so sending dollars overseas by immigrants is not going to cause the U.S. to go broke. And if immigrants, both legal and illegal want to receive social security benefits - they have to pay into the system like everybody else.

But the government is in real trouble for for other reasons. - In addition to massive borrowing from countries like China to finance the tax cuts for the rich, the govenment has borrowed hundreds of billions of dollars from the social security trust fund which has masked the true size of the budget deficit.

Until 1983, Social Security was a pay as you go system - a contract between generations, where the younger generation paid for the retirement of the previous generation. As a result of the massive 1983 reform package, in which social security taxes on wages were increased by about 1/3, the trust fund has built up a surplus of trillions of dollars - and the baby boomers have paid not only for their parents' retirement but for their own as well. By one measure, the 1983 reform package has been wildly successful, as the trust fund is now predicted to last at least until 2042, when the oldest baby boomers will be 96 years old.

Early in his first term, President Regan promised to balance the Federal Budget by 1983. The problem of course is that we have massive budget deficits under the administrations of Regean and Bush I and II. This year alone, congress will borrow approximately 150 billion dollars from the social security trust fund, every penny of which was paid for by FICA taxes on the wages of working people - and congress has no plan in place to pay it back when it is needed to fund the retirment of the baby boom generation.

When President Bush complained (in his 2005 State of the Union address) that in 2017, the trust fund will be paying out more than it takes in and when he calls the trust fund a "worthless bunch of IOU's," he is in effect asking for "debt relief." He wants to find a way to avoid repaying the debt to the trust fund so that he can preserve his 15% dividend and capital gains tax rates and his other tax breaks for the rich.

Thus we are faced with a profound moral isssue: Is it right to borrow and spend somebody's retirement moeny and not pay it back. If the CEOs of a big corporation (like Enron or World Com) had taken all the moeny from their employees' pension plans and replaced it with a bunch of worthless stock options or worthless IOUs, they would be headed to jail.

In order to take the high moral ground on this issue, Democrats must recognize that they had a hand in creating the big deficits of the past 23 years. Both parties have been buying our votes with borrowed money for far too long. But in any event, the press has an obligation to explain to the public that the problem is not with social security but with rest of the government. Neither the Democrats nor the Press have done their job.

Answer 2

No, that's not the reason it will go broke. The reason is that the Bush government has borrowed huge amounts of money from China to pay it's public debt, putting the country trillions of dollars in the red - all owed to foreign countries.

If, at some point, China requires repayment of those loans (and they might in the future) then the US will have to go cap in hand to the international banking system to get loans. Those loans will likely be tied to stringent economic measures that will put taxes way up. The government will also be forced to cancel some of the locally-held debt, and possibly programs like social security, which is paid for out of current tax revenues, not a fund.

We probably have 5 to 10 years before that happens - a short time in a country's history, but a long time in politics. Maybe the next President can turn the tide, just as Clinton did when he reduced the national debt during his tenure as President.

To all those that cite the Democrats as the problem - take a look at the national debt history. In both George Bush and G W Bush's presidencies, the national debt has increased at record rates. Under Clinton, it reduced every year. Under the Bushes, we never had a balanced budget, meaning we spent more than we brought in. Under Clinton, we achieved a balanced budget.

Which party REALLY is fiscally responsible?

Answer 3

No America is not going broke. However, the deficit is high and at some point we do have to make government fiscally responsible.
As to your specific conclusions regarding immigrants, both legal and illegal they do contribute to the economy as a whole. Even if they send the lion's share of their earning home they still must exist here. Immigrants must have housing, food, clothing and other essentials. They also engage in leisure activities. This all amounts to buying. With every purchase they contribute to the economy in the form of sales tax. Legal immigrants also pay income taxes. We have concerns we must address regarding illegal immigration in this country, but just because they are here illegally doesn't mean that they don't contribute at all.

Answer 4

Are you kidding? What money does the US have? We are trillions of dollars in debt. We are already beyond broke!!

And these people do NOT get social security. They barely even give legitimate cases social security benefits, I guarantee it would not be easy for an illegal immigrant.

Answer 5

Immigrants, even non-immigrants, spending their money they way they see fit does not make us broke. Running up huge deficits could. It would be a disaster if China or Saudi Arabia dumped their T-notes. It would be an economic Titanic.

Answer 6

quite possible esp. when all the baby boomers have finally retired
thats when we'll get a ratio of 1 supporting 2 people on SS. of
all the bad things to bring down the USA thats probably one of the
more realistic ones...

Answer 7

For misleading the American people, and launching the most foolish war since Emperor Augustus in 9 BC sent his legions into Germany and lost them, Bush deserves to be impeached and, once he has been removed from office, put on trial along with the rest of the president's men. If convicted, they'll have plenty of time to mull over their sins.

http://nationalpriorities.org/index.php?option=com_wrapper&Itemid=182

Answer 8

No,the U.S. is going to go broke pouring trillions of dollars into
the black hole known as the Iraq War. Immigrant labor is actually
good for the economy even when it's illegal. Get informed.

Answer 9

I doubt it. But I am hoping in the next few years that the welfare system in this country goes belly-up. We need to dump these illegals off of our welfare system. I'm sick of paying for them to live the high-life while I work my butt off. Illegal women should be sterilized when they come over the border so they cannot mass produce.

Answer 10

It seems pretty obvious to me that, slowly but surely, we are going down. This is because what you have said partly, but also because the Democrats. Many people have lost jobs or been outsourced by foreign companies because some democrat wants Americans to suffer.