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Obama Expansion Of Social Security

apdst said:
Social Security was never intended to be used for wealth redistribution.
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Social security is wealth redistribution for most recipients regardless of your income.

Say you retired this year..and say you had worked for 45 years and had been fortunate in that you had a large enough wage that you contributed the maximum amount to social security every year of that 45 years.
Going back through that time on what the tax/contribution rates were and summing the total investment you had made over 45 years of working how long do you think it would take you... based on the current social security monthly payment... to totally deplete all the money you had contributed to social security.
A year or two ago I went through and calculated all of this... it would take maybe 7 years... and that's if you had contributed the maximum ever year.
For the average social security recipient it would take around 3 years , maybe less.
This is why its going broke... unless you die sooner than that period ... which some do obviously... then you very likely will take more money out of the program than you ever contributed.
If they didn't know this would happen when they designed it then they were not very competent. I think they did... but that was something that would have to be dealt with by future generations after they were long gone.
 
Napoleon said:
I wasn't looking at life expectancy of infants. I was looking at life expectancy of people who had lived at least to the age of 21. In 1940 it was 53.9 for men and 60.6 women with life expectancy beyond 65 at an additional 12.7 years and 14.7 years respectively. Back then, you could only receive payments from the age of 65. Now the averages are 72.3 for men and 83.6 for women with 15.3 and 19.6 years beyond 65 and you can start drawing SS at 62. Adjusting the age of eligibility down instead of up as life expectancy increased is what has placed SS in peril.
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Early eligibility lowers the amount of the benefit to be paid. It is basically break even in terms of Social Security. The SSA says that it makes no difference to your lifetime benefit whether you claim at 62, 66, or 70 if you have a normal life expectancy. Where did you get your information for "I was looking at life expectancy of people who had lived at least to the age of 21. "
 
JoeTheEconomist said:
Early eligibility lowers the amount of the benefit to be paid. It is basically break even in terms of Social Security. The SSA says that it makes no difference to your lifetime benefit whether you claim at 62, 66, or 70 if you have a normal life expectancy. Where did you get your information for "I was looking at life expectancy of people who had lived at least to the age of 21. "
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The Social Security Administration.
 
Eliminate the payroll cap. That will fund SS for many additional decades, perhaps for perpetuity.

Solutions are easy, if there's a will. It's the will that's lacking among conservatives, who just want to end SS.
 
Checkerboard Strangler said:
The fact that you don't see any value for your taxes, or don't recognize the value, doesn't change the fact that Social Security works like an insurance policy. If the program were privatized, you would still be setting up an automatic debit from a card or directly from your bank account to pay the fee every month, and it would still work like an insurance policy, at least until the criminals on Wall Street depleted it or screwed the pooch in the market and asked for another bailout anyway.

Then all bets are off.
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No one is seriously talking about privatizing Social Security. It is a toothless straw dragon trotted out by Democratic fund raisers. The conversion would cost as much as $30 trillion - where are you going to get that from?
 
jpn said:
Eliminate the payroll cap. That will fund SS for many additional decades, perhaps for perpetuity.

Solutions are easy, if there's a will. It's the will that's lacking among conservatives, who just want to end SS.
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Perhaps, but the probability approaches statistically insignificance. SSA/CBO put it at decades, but you ought to read the editorial in the OP.
 
iguanaman said:
SS is actually the most popular and successful of the "New Deal" policies. This is what our Republican President said about it when I was a child.
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Good things have their time. Given the original circumstances it was probably the best solution. Like land-line telephones with round dials. ....
 
JoeTheEconomist said:
I recommended that you personally use SSA rather than think tanks. Here you are reading a label that is associated to data from the SSA that has nothing to do with that label. Yes CRFB is using data from SSA, but it is misleading you about its meaning.
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Okedoke. I've given you the link to the tool and the link to the original SSA report from which they drew the numbers. Please demonstrate how the Think Tank is providing an untruthful depiction of the SSA data.

cpwill said:
No it isn't. It's set at 65-67, whatever your normal retirement age is.
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"The PIA is the sum of three separate percentages of portions of average indexed monthly earnings. The portions depend on the year in which a worker attains age 62, becomes disabled before age 62, or dies before attaining age 62. "

https://www.ssa.gov/OACT/COLA/piaformula.html
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From your link:

The "primary insurance amount" (PIA) is the benefit (before rounding down to next lower whole dollar) a person would receive if he/she elects to begin receiving retirement benefits at his/her normal retirement age. At this age, the benefit is neither reduced for early retirement nor increased for delayed retirement.​


From the link to "Normal Retirement Age":

Year of birth: Age

1937 and prior: 65
1938: 65 and 2 months
1939: 65 and 4 months
1940: 65 and 6 months
1941: 65 and 8 months
1942: 65 and 10 months
1943-54: 66
1955: 66 and 2 months
1956: 66 and 4 months
1957: 66 and 6 months
1958: 66 and 8 months
1959: 66 and 10 months
1960 and later: 67 ​


But I think this is straining at gnats. The point remains that you can easily reduce the growth for upper benefit recipients while putting in a floor of 125% of the FPL for lower benefit recipients without "breaking" social security :roll: In fact - again according to the SSA's own numbers such a move would improve Social Security's finances.
 
jpn said:
Eliminate the payroll cap. That will fund SS for many additional decades, perhaps for perpetuity.

Solutions are easy, if there's a will. It's the will that's lacking among conservatives, who just want to end SS.
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Eliminating the cap requires that you eliminate the cap on benefits as well, otherwise, you will net suck a couple hundred billion from GDP annually, forever.
 
cpwill said:
Okedoke. I've given you the link to the tool and the link to the original SSA report from which they drew the numbers. Please demonstrate how the Think Tank is providing an untruthful depiction of the SSA data.
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Description from the SSA : "Beginning for those newly eligible in 2022, reconfigure the special minimum benefit: (a) A year of coverage is defined as a year in which 4 quarters of coverage are earned. (b) At implementation, set the PIA for 30 years of coverage equal to 125 percent of the monthly poverty level (about $1,216 in 2014). For those with under 30 years of coverage, the PIA per year of coverage over 10 years is $1,216/20 = $60.80. (c) From 2014 to the year of implementation, 2022, index the PIA per year of coverage using the chain-CPI index. Then, for later years, index the PIA per year of coverage by wage growth for successive cohorts. (d) Scale work requirements for disabled workers, based on the number of years of non-disabled potential work. "

Here is CRFB's description : "Create Minimum Benefit at 125% of Poverty" From this description you would think that they are talking about all retirees. Many poor retirees got that way by inconsistent work histories. One more time why should someone who turned 62 in 2022 get a bonus that earlier retirees do not collect. This person may or may not be poor who gets bank-error in their favor when actually poor seniors aren't even eligible.
 
What I like most about the proposal to expand SS benefits is that it puts the GOP on the defensive for a change. Instead of talking about ways to cut or privatize SS, we're talking about expanding it.

I agree with the editorial in the OP that there are higher priorities to be had, but that is always the case, isn't it? Yes, let's cut defense spending and increase investment in infrastructure, pre-school care, education, scientific research and health care.

How refreshing to be discussing this instead of who offers the biggest deficit-exploding tax cuts for the already rich:
blog_tax_deficit_rubio_cruz_trump_clinton.jpg
 
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jpn said:
What I like most about the proposal to expand SS benefits is that it puts the GOP on the defensive for a change. Instead of talking about ways to cut or privatize SS, we're talking about expanding it.

I agree with the editorial in the OP that there are higher priorities to be had, but that is always the case, isn't it? Yes, let's cut defense spending and increase investment in infrastructure, pre-school care, education, scientific research and health care.
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The only people to talk about privatization in the last 10 years are democratic fund raisers. Cruz was the only candidate to support allowing workers to keep a portion of their payroll taxes. Mind you his tax plan ended payroll taxes, so it is unclear what he was talking about. Like most of the GOP he didn't even list SS as an issue.

You can end the military, and you can't pay for SS. So there is nothing left over to invest in anything. That is as the system is today. This isn't about making SS stronger. It is old-fashion vote buying. So there is no change in the subject.

jpn said:
How refreshing to be discussing this instead of who offers the biggest deficit-exploding tax cuts for the already rich:
blog_tax_deficit_rubio_cruz_trump_clinton.jpg
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This was before she started talking about expanding SS. The people who created this analysis couldn't find any evidence that Clinton intends to raise payroll taxes on the rich.
 
Samhain said:
Eliminating the cap requires that you eliminate the cap on benefits as well, otherwise, you will net suck a couple hundred billion from GDP annually, forever.
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Not sure how you connect these dots. Eliminating the cap today pulls 8 or 9 trillion away from other tax priorities, like paying down the debt. Ending the cap on benefits, doesn't really put money back into the economy. It generally goes to people who are spending what they want anyway. The real question is whether expanding SS is more important than JPN's investments in infrastructure, pre-school care, education, scientific research and health care.
 
joG said:
And this at a time, when we should be downsizing SS, if not replacing it totally. It is a bad system and economists have known it to be so since I was a child. In the meantime our technology has improved so much that it is unbelievable, that we should still be trying to fix it instead of a total change.
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Yea, let's privatize Social Security and give the money to the stock market so they can invest it. That was a Bush proposal, and I'm glad it went nowhere. Had that happened, then Social Security checks would have totally tanked when the stock market crashed, and seniors wouldn't even be able to afford dog food to eat.
 
danarhea said:
Yea, let's privatize Social Security and give the money to the stock market so they can invest it. That was a Bush proposal, and I'm glad it went nowhere. Had that happened, then Social Security checks would have totally tanked when the stock market crashed, and seniors wouldn't even be able to afford dog food to eat.
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A diversified portfolio is the way to go. But that is a question of portfolio structures and risk mix.
 
JoeTheEconomist said:
The only people to talk about privatization in the last 10 years are democratic fund raisers. Cruz was the only candidate to support allowing workers to keep a portion of their payroll taxes. Mind you his tax plan ended payroll taxes, so it is unclear what he was talking about. Like most of the GOP he didn't even list SS as an issue.

You can end the military, and you can't pay for SS. So there is nothing left over to invest in anything. That is as the system is today. This isn't about making SS stronger. It is old-fashion vote buying. So there is no change in the subject.



This was before she started talking about expanding SS. The people who created this analysis couldn't find any evidence that Clinton intends to raise payroll taxes on the rich.
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It's hard for me to imagine anything being more wrong than your first statement above.

Heritage and Cato have been fighting for SS privatization- are you under the ridiculously false impression that these are democratic fundraising organizations ?
 
JoeTheEconomist said:
https://www.washingtonpost.com/opin...b8fe28-29c0-11e6-a3c4-0724e8e24f3f_story.html

The WP has the best editorial on Social Security I have seen in years.

Obama's statement have no proposal to increase revenue, and no details about how he would expand Social Security benefits.

1) There are no details
2) It is virtually impossible to expand SS in a way to help those who are poor
3) Tax increases will compete with other priorities
4) Children are twice as likely to be in poverty, and yet in 2011, the federal government spent six times as much on the elderly as it did on children. Children can’t vote.

Not sure about the statistics behind #4, but the last line is priceless.
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Yes, that last line in the story is priceless... "Children can't vote."

I might have added one line to that one that needs to be said -- "None of today's 'children and the grandchildren' have yet been forced to contribute one damned dime in FICA taxes to the Social Security and Medicare systems -- but people who are in their 60's today have been forced to pay into these systems all their working lives!" :eek:
 
Absentglare said:
It's hard for me to imagine anything being more wrong than your first statement above.

Heritage and Cato have been fighting for SS privatization- are you under the ridiculously false impression that these are democratic fundraising organizations ?
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Heritage is selling something called 'true insurance', which is indistinguishable from something called 'welfare'. Cato is a cottage industry player that hasn't updated is plan in a decade. Where is the proposed legislation behind these players? Converting SS to a system of private accounts might cost as much as $30 trillion. Wake me when someone has a plan.
 
Pollycy said:
Yes, that last line in the story is priceless... "Children can't vote."

I might have added one line to that one that needs to be said -- "None of today's 'children and the grandchildren' have yet been forced to contribute one damned dime in FICA taxes to the Social Security and Medicare systems -- but people who are in their 60's today have been forced to pay into these systems all their working lives!" :eek:
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But if they aren't, then the people who are in their 60s today will not get paid.
 
danarhea said:
Yea, let's privatize Social Security and give the money to the stock market so they can invest it. That was a Bush proposal, and I'm glad it went nowhere. Had that happened, then Social Security checks would have totally tanked when the stock market crashed, and seniors wouldn't even be able to afford dog food to eat.
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The Bush proposal was a debacle waiting to happen, but the financial crisis was the least of the problems. The problems were structural. By the time that the FC arrived, a fraction of the working public would have put a fraction of a year's wages into the system. Wait that was a fraction of what is a fraction of wages. Social Security checks would have been unaffected. Nice panic attack.

If you are going to complain about the Bush plan at least get the right complaint :

Bush’s plan would not have fixed Social Security | TheHill
 
joG said:
A diversified portfolio is the way to go. But that is a question of portfolio structures and risk mix.
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Bush's plan was poorly thought out, but the Wall Street drama played-out here over and over again is the problem with the plan. It was just another way to kick the can.
 
JoeTheEconomist said:
The only people to talk about privatization in the last 10 years are democratic fund raisers. Cruz was the only candidate to support allowing workers to keep a portion of their payroll taxes. Mind you his tax plan ended payroll taxes, so it is unclear what he was talking about. Like most of the GOP he didn't even list SS as an issue.
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Perhaps you've heard of Paul Ryan, who is the Speaker of the House of Representatives.

That House Budget Committee Chairman Paul Ryan (R-WI) supports the privatization of Social Security is well known. Ryan proposed $1.2 trillion in cuts and the partial privatization of Social Security upon taking control of the Budget Committee in 2011, and he has constantly warned about the supposed doom facing the program if major reforms aren’t enacted immediately.
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JoeTheEconomist said:
Bush's plan was poorly thought out, but the Wall Street drama played-out here over and over again is the problem with the plan. It was just another way to kick the can.
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Government should be out of the transfer business beyond a smallish minimum income payment and severe punishment for fraud.
 
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