Word: surplus
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...Lionel Jospin, a socialist, avoids using them. "You wonder just how exceptional France can be and still remain a player in the global economy," muses a Western diplomat in Paris. And yet--vive le paradoxe--France today boasts a healthy growth rate, low inflation and a muscular foreign-trade surplus. At the same time, Jospin has actually privatized more state-owned enterprises than did his conservative predecessors, has reined in state spending and is now preparing substantial tax cuts...
...politicians of both parties to seem so concerned about such a distant threat. But second, this debate will have no effect on Social Security. That's not opinion or prediction: that's mathematics. Republicans and Democrats say they want the budget to balance without counting the Social Security surplus. It's an admirable goal for many reasons, but the safety of Social Security is not among them...
Social Security currently brings in almost $150 billion more a year in payroll taxes than it pays out in benefits. So suppose the government balances the non-Social Security budget. What happens to the Social Security surplus? By law, it is invested in special government bonds. (Even if there is no deficit, the government still must issue bonds to replace ones that mature.) So the Social Security trust fund will add $150 billion to its collection of government bonds, and the government will sell $150 billion less to the public...
...fund still acquires $150 billion in government bonds. If, say, there is a $50 billion non-Social Security deficit, government borrowing from the public will be $50 billion higher than if the budget was balanced--but $100 billion less than if there weren't a $150 billion Social Security surplus. The government owes somebody an extra $50 billion, but the situation of the Social Security trust fund is exactly the same in either case...
...fantasy debate over raiding Social Security for general government operations is especially weird because what is actually happening is the opposite. Both parties have agreed in principle that some part of the future government surplus should go to saving Social Security. In other words, general tax revenues will be poured into the Social Security trust fund and used to finance benefit checks...