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Privatized Social Security

dairyair said:
They have the control, because they pick who invests the money. They set up the rules/laws of how that money is invested.
You're proposing the gov't hires a pvt company to do the admin, yes?

That company will be very very very rich.
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.....

I don't know what to say except to repeat myself, as this is the exact same point I addressed in the post you quoted.

I think you are imagining that I am advocating for a single government run mutual fund. That is A) not my position and B) does not necessarily mean they get to pick winners and losers - that's one of the points behind Index funds, after all.
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So.

A) I'm not saying that people should only be allowed to purchase mutual funds run by government employees, nor is that a requirement for the government to administer the program.

B) Even if government employees were doing the actual purchasing of the stocks within the funds, Index Funds keep them from picking winners and losers in the market.


I don't really know how to say this much simpler. Can you point me to the section where we are talking past each other, here?
 
cpwill said:
Every American is already fabulously wealthy by earlier standards. "Rich" is a relative term.
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Nobody is talking about the standard of living for the poor. You can give a slave satin sheets, but he's still a slave. That's a hollow argument put forth by the rich.

cpwill said:
What we are saying is that every American should save and invest over their working life in order to fund consumption in retirement.
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Right, and you believe that investing in the stock market will leave retirees better off. But here's the thing: if the stock market went up to the point where everybody was wealthy on paper, everybody can't consume like a rich man unless the economy produces enough. And there is nothing in this plan that would make companies increase production.

The stock market has little connection to the economy. It's rich people betting on paper horses. The more people bring their savings to the market, the higher stock prices will go, but that has nothing to do with the underlying companies. All you get from that is artificially high stock prices on paper. And almost all of the profits are paid by new investors buying old stocks. That is a true Ponzi Scheme.
 
cpwill said:
.....

I don't know what to say except to repeat myself, as this is the exact same point I addressed in the post you quoted.




So.

A) I'm not saying that people should only be allowed to purchase mutual funds run by government employees, nor is that a requirement for the government to administer the program.

B) Even if government employees were doing the actual purchasing of the stocks within the funds, Index Funds keep them from picking winners and losers in the market.


I don't really know how to say this much simpler. Can you point me to the section where we are talking past each other, here?
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The Pros and Cons of Privatizing Social Security | The Motley Fool

Here's an article. Pros and cons.

...Here's why privatization won't work
Now, back to where we began: Why didn't George W. Bush's privatization reform bill pass muster?

Ultimately, this last negative -- the fact that it wouldn't do anything to improve the Social Security program over the long run -- is what did it in. Don't get me wrong, turning private accounts over to millions of Americans with little or no financial knowledge is scary, too. But the bigger issue here is that Bush's proposal addressed something that could only be considered if the program were on solid footing, which it wasn't, and still isn't.

In order to fix Social Security and resolve its $13.2 trillion cash shortfall over the next 75 years, we're going to need to see bipartisan cooperation on Capitol Hill. Unfortunately, the only time that seems to happen is when the 11th hour hits. Even the Social Security reforms passed in 1983 during the Reagan administration were completed in seemingly the final hour. Lawmakers had more than a decade of warning that the program's asset reserves were insufficient, yet waited until the last moment to fix the program.

This is likely what'll happen again, to the detriment of current and future retirees.
...

If gov't can't address issues with SS now and haven't since the 1980s. What makes one think they can get partisanship on correctly privatizing all that money?
Quite simply, the gov't won't do what is correct to get things correct. Partisanship simply doesn't allow it.

To your point. Someone has to run the pvt SS account. Yes? Who choose which company(s) are going to administer the SS money?
 
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What amount would be considered an adequate monthly Social Security benefit for an individual who retires at full retirement age?
Should such an amount be based on the current median income or some other figure?
 
JohnfrmClevelan said:
Nobody is talking about the standard of living for the poor. You can give a slave satin sheets, but he's still a slave. That's a hollow argument put forth by the rich.
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I'll admit, I'm not certain what point you think you are making. No one is arguing that we should sell anyone back into slavery, nor that their property rights to their own savings should be taken away by others.

If the argument is "but we can't all be rich", well, the answer is that "rich" is a relative term, not an absolute one. So, we are all currently rich by some standards (in fact, we are the vast majority of us "rich" by the standards of the vast majority of human experience) and the vast majority of us are currently impoverished (presumably) by others. It's like saying "we can't all be educated".

Right, and you believe that investing in the stock market will leave retirees better off.
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And the math backs that.

But here's the thing: if the stock market went up to the point where everybody was wealthy on paper, everybody can't consume like a rich man unless the economy produces enough. And there is nothing in this plan that would make companies increase production.

The stock market has little connection to the economy. It's rich people betting on paper horses. The more people bring their savings to the market, the higher stock prices will go, but that has nothing to do with the underlying companies. All you get from that is artificially high stock prices on paper. And almost all of the profits are paid by new investors buying old stocks. That is a true Ponzi Scheme.
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No, the American economy is still producing.

If your typical worker (making up a number) retires with $1.2 million in the account, and it is structured such that he draws off 5% of that every year, his consumption is going to be about $60,000 a year. That's a pretty typical, reasonable, consumption rate. All that has happened is that, by saving and investing, he is able to maintain working-years-level-consumption during his retirement years.

Did you think everyone was going to be tossing around a million dollars a year, or something?
 
Glitch said:
Actually, none of that is true. We have Chile as an example. In 1960 Chile decided to implement a Social Security program based upon the US program. By 1990 they realized that it was just a ponzi scheme, and not viable. As a result Chile privatized their Social Security. Beginning in 1990 all those who wished to invest their Social Security withholding in the private stock market could, but only through government-approved investors. By the year 2000 only 10% of Chile's workers remained on the government Social Security program. 90% of their workforce had switched to private investments where they have more control. As a result Chile has become an economic powerhouse in South America.

Chile : The Superpower of South America

It is actually unconstitutional for the federal government to involve itself in any social program. That is a power reserved exclusively to the States by the US Constitution. Which makes Social Security illegal.
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Glitch, ​
regarding your provided link, Chile : The Superpower of South America - Young Diplomats , I haven’t yet found any information supporting or denying the credibility of the “Young Diplomats” organization. I haven’t yet found any information supporting or denying the credibility of David Allouche, who’s identified as the author of the article, “Chile: The Superpower of South America”.

Your statement, “It is actually unconstitutional for the federal government to involve itself in any social program. That is a power reserved exclusively to the States by the US Constitution. Which makes Social Security illegal”, is less than credible.
Each session of the U.S. congresses that passed legislation, and every president that signed on to such legislation, disagrees with your opinion. Our federal courts do not deem the federal Social Security retirement plan as contrary to the U.S. Constitution.

I’m unfamiliar with retirement funding in Chile. I will not at this time presume to respond to your comments regarding Chile. Respectfully, Supposn
 
dairyair said:
The Pros and Cons of Privatizing Social Security | The Motley Fool

Here's an article. Pros and cons.

...Here's why privatization won't work
Click to expand...

Cool. Here's a thread where I hashed all this out in detail and at length, where you can see the numbers laid out, year by year, over the next several decades.

Now, back to where we began: Why didn't George W. Bush's privatization reform bill pass muster?

Ultimately, this last negative -- the fact that it wouldn't do anything to improve the Social Security program over the long run -- is what did it in. Don't get me wrong, turning private accounts over to millions of Americans with little or no financial knowledge is scary, too. But the bigger issue here is that Bush's proposal addressed something that could only be considered if the program were on solid footing, which it wasn't, and still isn't.

In order to fix Social Security and resolve its $13.2 trillion cash shortfall over the next 75 years, we're going to need to see bipartisan cooperation on Capitol Hill. Unfortunately, the only time that seems to happen is when the 11th hour hits. Even the Social Security reforms passed in 1983 during the Reagan administration were completed in seemingly the final hour. Lawmakers had more than a decade of warning that the program's asset reserves were insufficient, yet waited until the last moment to fix the program.

This is likely what'll happen again, to the detriment of current and future retirees.
...

If gov't can't address issues with SS now and haven't since the 1980s. What makes one think they can get partisanship on correctly privatizing all that money?
Quite simply, the gov't won't do what is correct to get things correct. Partisanship simply doesn't allow it.

To your point. Someone has to run the pvt SS account. Yes? Who choose which company(s) are going to administer the SS money?
Click to expand...

You are conflating Administering with Controlling - the two are not the same.

1. An entity can administer an account without controlling it.

2. Even if the government was the entity doing the actual purchasing (If, for example, the C Fund was made available to the entire populace), indexing keeps them from being allowed to pick companies to be winners or losers.




If your argument (per above) is that partisanship is going to keep us from choosing a wise policy option until it is too late to pick among awful policy options, well, I agree :shrug: I am making an argument about what we should do, not what we are likely to do. We are likely to make terrible and self-destructive decisions until we can no longer sustain the burden of those decisions, precipitating a crises.
 
Individual said:
What amount would be considered an adequate monthly Social Security benefit for an individual who retires at full retirement age?
Should such an amount be based on the current median income or some other figure?
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That is an excellent question.
 
cpwill said:
… Just to point out, the emphasized section above is the argument that having the federal government on the hook for 100% of all benefits is less expensive than having the federal government on the hook for a portion of some benefits.... which strikes me as unlikely to be true.
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CPWill, due to the concept driving Supplemental Security Income, (SSI) benefits, the government is on the hook for 100% of what’s deemed minimum acceptable monthly benefits. Under the privatized system, the taxpayers are still required to pay no less than their legal payroll tax obligations. If the tax rates are insufficient, the federal government is on the hook for the entire consequentially insufficient benefits to meet the minimum benefits and retired higher income workers monthly benefits will be much less than they had reason to expect. If the commercial investment’s return is insufficient, if for any reason the commercial fund fails to uphold their obligations, the government is on the hook for 100% of the differences.

Privatized Social Security accounts will inevitably increase government’s net costs and reduce the realized benefits for many of those retired. Respectfully, Supposn
 
I'm Supposn said:
Glitch, ​
regarding your provided link, Chile : The Superpower of South America - Young Diplomats , I haven’t yet found any information supporting or denying the credibility of the “Young Diplomats” organization. I haven’t yet found any information supporting or denying the credibility of David Allouche, who’s identified as the author of the article, “Chile: The Superpower of South America”.

Your statement, “It is actually unconstitutional for the federal government to involve itself in any social program. That is a power reserved exclusively to the States by the US Constitution. Which makes Social Security illegal”, is less than credible.
Each session of the U.S. congresses that passed legislation, and every president that signed on to such legislation, disagrees with your opinion. Our federal courts do not deem the federal Social Security retirement plan as contrary to the U.S. Constitution.

I’m unfamiliar with retirement funding in Chile. I will not at this time presume to respond to your comments regarding Chile. Respectfully, Supposn
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For verification of what I posted concerning Chile see Chile’s Social Security Lesson For The U.S. - CATO Institute, December 1997

With regard to federal social spending, including Social Security, the Tenth Amendment makes it clear that the only power the federal government has are those granted to them by the US Constitution. All other powers, not specifically prohibited to the States by the US Constitution, are reserved exclusively for the States and/or the people. That not only includes all social spending, but education and healthcare as well. These are powers only the States have the authority to wield, and the federal government is prohibited from exercising ANY power not specifically granted to them.

Nowhere will you find authorization for Congress to appropriate funds for social, education, or healthcare programs. Which means that Social Security, among many other federal programs, violates the Tenth Amendment.
 
cpwill said:
I'll admit, I'm not certain what point you think you are making. No one is arguing that we should sell anyone back into slavery, nor that their property rights to their own savings should be taken away by others.
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Saying "everyone is rich by yesterday's standards" is often used as a justification for today's huge income disparity. It doesn't matter if guy flipping burgers can afford a flat-screen TV, he's still flipping burgers.

cpwill said:
If the argument is "but we can't all be rich", well, the answer is that "rich" is a relative term, not an absolute one. So, we are all currently rich by some standards (in fact, we are the vast majority of us "rich" by the standards of the vast majority of human experience) and the vast majority of us are currently impoverished (presumably) by others. It's like saying "we can't all be educated".
Click to expand...

The argument is, "we can't all consume like rich men unless the economy produces more." Being able to consume like a rich man is the real measure of whether or not this is a good idea.

cpwill said:
And the math backs that.
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You are counting dollars, though, not what they might buy. Where are all of those dollars coming from?

cpwill said:
No, the American economy is still producing.
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...and it would need to produce (a lot?) more to meet the demand of dollar-rich retirees.

Show me the flow of dollars between companies and the stock market. When Amazon makes another $billion, how do those dollars earned by Amazon pump up the stock market? Or vice versa? How is our "investment" in the stock market ending up as real investment?

cpwill said:
If your typical worker (making up a number) retires with $1.2 million in the account, and it is structured such that he draws off 5% of that every year, his consumption is going to be about $60,000 a year. That's a pretty typical, reasonable, consumption rate. All that has happened is that, by saving and investing, he is able to maintain working-years-level-consumption during his retirement years.

Did you think everyone was going to be tossing around a million dollars a year, or something?
Click to expand...

What's to stop them? Where is the limit on how high the stock market can go?
 
Glitch said:
For verification of what I posted concerning Chile see Chile’s Social Security Lesson For The U.S. - CATO Institute, December 1997

With regard to federal social spending, including Social Security, the Tenth Amendment makes it clear that the only power the federal government has are those granted to them by the US Constitution. All other powers, not specifically prohibited to the States by the US Constitution, are reserved exclusively for the States and/or the people. That not only includes all social spending, but education and healthcare as well. These are powers only the States have the authority to wield, and the federal government is prohibited from exercising ANY power not specifically granted to them.

Nowhere will you find authorization for Congress to appropriate funds for social, education, or healthcare programs. Which means that Social Security, among many other federal programs, violates the Tenth Amendment.
Click to expand...

So, somebody should call the Supreme Court and let them know they have been getting it wrong all these years. And cite "Glitch," so they know we mean business.
 
dairyair said:
As long as the US gov't is in existence, the gov't is the more secure investment. It has the least amount of risk, meaning the least amount of gain. But it is the safest. IMO.

In a pvt business with all that extra SS monies, what's to stop the pvt company from manipulation of markets? They will be the largest investor.
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I find your risk analysis extremely flawed. Have you actually read the SS actuaries reports?

The situation of a pvt business with all that extra monies.... it’s non existent. It’s pure day dreaming. Fidelity and Vanguard have an astronomically better record of managing funds than the federal government. Fiduciaries risk criminal charges if they don’t act in your interests. No matter who you chose though none of the pvt companies are “investors”.

You’re the investor. They make money by making you money.

Who in social security or the government has a stronger motive to bring actual measurable results?
 
dairyair said:
Can you hear the screaming and yelling by partisan when gov't chooses who the winners are that gets to get super super rich handling all that SS monies?
And you don't think with all that money, corruption won't creep in?
Humans are humans afterall. What would happen if that money was stolen/embezzles/etc? Who would cover the losses? Back to the taxpayer I assume.

I can't see how this works well. One has to expect the worse to happen when a pvt company gets their hands on all that SS money. Because at some point the worse will happen.
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None of this is possible. Do you have a 401K? An IRA? I don’t think you understand how this works.
 
dairyair said:
Gov't will always be in control of funds. And IMO, they should.

How would a pvt company be controlled? By gov't. Who secures funds if the company goes bankrupt?

How does a pvt company get chosen? Isn't that a gov't playing favorites by choosing?
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Govt proves it’s outrageous incompetent every day. If you want your funds in their hands, I think you should have that right. It’s pure hubris for liberals to force those of us who understand basic math into this Ponzi Scheme.

How would a pvt company be controlled? Same way they are today. Who secures the funds when the govt goes bankrupt?

How does a pvt company get chosen? I choose mine based on fees and returns. No, the government isn’t choosing. That’s what we have now and why it’s sucks beyond imagine.
 
I'm Supposn said:
Aberration, some of my employers were financial industry corporations that did contribute to my IRA’s. I don’t recall if any or all of them matched 100% of my deposits.
I do recall that many of my fellow employees could not afford to avail themselves of the opportunity. I suppose that many employees that were enticed to open later experienced net financial losses due to the penalties for early withdrawals. I Suppose a high proportion of employees encounter such desperate needs.

I doubt if most corporations match their employees’ tax deferred funds, and I greater doubt if they match them at 100%. I suppose that proportionally few employees vest and receive any of corporate matching fund benefits.

I’m old and retired. Due to my observations and life experiences, I have more confidence in the government of the United States and less confidence in our corporations; (Donald Trump will not always be president). If we enacted self-directed privatized Social Security retirement accounts, there’d be increased need federal Supplemental Security income distributions and it would be net detrimental to our economy.

Respectfully, Supposn
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Supposn, Every employer matches your SS contributions 100%.

You being old and retired, you’re the problem. You ****ed every generation after you because you refused to follow the math. Unless you’ve read the actuary reports and know full well what you are subjecting me to, which is 1000x worse than what you’d had to fairly share, your observations are founding on nothing.

You choose your confidence how you want. I will look at the history of SS versus the market and make the clearly obvious choice. Your choice screwed everyone. My choice makes everyone’s retirement solvent and independent.

Respectfully, Aberration.
 
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Glitch said:
For verification of what I posted concerning Chile see Chile’s Social Security Lesson For The U.S. - CATO Institute, December 1997

With regard to federal social spending, including Social Security, the Tenth Amendment makes it clear that the only power the federal government has are those granted to them by the US Constitution. All other powers, not specifically prohibited to the States by the US Constitution, are reserved exclusively for the States and/or the people. That not only includes all social spending, but education and healthcare as well. These are powers only the States have the authority to wield, and the federal government is prohibited from exercising ANY power not specifically granted to them.

Nowhere will you find authorization for Congress to appropriate funds for social, education, or healthcare programs. Which means that Social Security, among many other federal programs, violates the Tenth Amendment.
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Glitch, you’re a right-wing advocate is citing the opinions of CATO as authoritative. I don’t doubt you consider CATO’s opinions as an authoritative source, but many other of us disagree with that.

Each session of the U.S. congresses that passed legislation, and every president that signed on to such legislation, disagrees with your opinion. Our federal courts do not deem the federal Social Security retirement plan as contrary to the U.S. Constitution.

CATO is where I look to find and better understand general Republican Party opinions. CATO’s opinions are partisan opinions. Respectfully, Supposn
 
I'm Supposn said:
Privatized Social Security:
It would require at least a generation’s duration, and/or substantial federal expense, to privatize our Social Security retirement system. Since Social Security’s enactment, the practice was current employees and employers paying the current monthly benefits.
Any shortfalls must be replaced with federal loans and/or increased taxes, and/or reduction of benefits. (I‘m strongly opposed to reduction of benefits).

Within a privatized system, there’s certain to be incidences of participants’ poor judgement or misfortune. When an individual reaches retirement age and there’s insufficient wealth accumulated within their account, do we propose providing them with Supplemental Security Income? SSI is a public assistance, (i.e. a government administered charity). Even for a generation of employees with excellent judgement, there are business cycles and financial mishaps that are beyond individuals’ control or foresight.

What’s the difference between public assistance for privatized retirement accounts, or for those playing in casinos? Social Security retirement and survivors benefits substantially reduced poverty among our elderly and employees' surviving families.

Respectfully, Supposn
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Good luck
 
Aberration said:
Supposn, Every employer matches your SS contributions 100%. …
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Aberration, in response to your comment, “Since we are talking about privatizing SS, your current contribution are simply directed to an actual investment instead of into to the pockets of politicians. So anyone working can afford it. With 100% match from their employer”, I posted “some of my employers were financial industry corporations that did contribute to my IRA’s. I don’t recall if any or all of them matched 100% of my deposits”.

There’d be no point to provisions for taxpayers contributing more than their required tax obligations to a privatized Social Security accounts. They can in effect now do so by establishing tax-deferred retirement accounts. This subtopic is not germane, and we can remove it from our further discussions. Respectfully, Supposn
 
Aberration said:
Supposn, … You being old and retired, you’re the problem. You ****ed every generation after you because you refused to follow the math. Unless you’ve read the actuary reports and know full well what you are subjecting me to, which is 1000x worse than what you’d had to fairly share, your observations are founding on nothing.

You choose your confidence how you want. I will look at the history of SS versus the market and make the clearly obvious choice. Your choice screwed everyone. My choice makes everyone’s retirement solvent and independent.

Respectfully, Aberration.
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Aberration, I read the opinions and accusations you here expressed, but I don’t find your logical arguments supporting those opinions. (I'm indifferent to your accusations). Respectfully, Supposn
 
I'm Supposn said:
Glitch, you’re a right-wing advocate is citing the opinions of CATO as authoritative. I don’t doubt you consider CATO’s opinions as an authoritative source, but many other of us disagree with that.

Each session of the U.S. congresses that passed legislation, and every president that signed on to such legislation, disagrees with your opinion. Our federal courts do not deem the federal Social Security retirement plan as contrary to the U.S. Constitution.

CATO is where I look to find and better understand general Republican Party opinions. CATO’s opinions are partisan opinions. Respectfully, Supposn
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Supposn, Ad Hominem, such as this, is a fallacy.

Sent from my Moto G (5S) Plus using Tapatalk
 
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