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Shoud Social Security be Phased Out & Replaced With Private Investments

How About Privatizing Social Security

  • Yes

    Votes: 20 21.3%

  • No

    Votes: 70 74.5%

  • Maybe

    Votes: 4 4.3%
  • Total voters
    94
  • Poll closed .
LesGovt said:
Would you be in favor of an investment plan that would be phased in over the next 20 to 50 years, where at the end no money would go to the Federal Government? You could invest in mutual funds or Certificate of Deposits on a weekly basis of 12% of your income with 6% coming from your paycheck and 6% coming from your employer. You could not touch the money under the same basic terms as Social Security.
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It is certainly the better solution to put SS into the private sector. Accompanied by a small guaranteed minimum income it would be much more efficient and safe for citizens.
 
I don't see how you could do it, since politicians have stolen the Social Security fund dry. It relies on young people putting in so that old people can get out. The second you privatize it, the second you have no more money to give the elderly unless we go even further into debt to replace at least some of the money that has been stolen.
 
My Roth IRA is worth more than my SS. The Roth withdrawals are tax free while I have to pay taxes on the SS. Even though I paid taxes on the SS when they took it out as a payroll tax.

So, yeah, I vote privatize SS.
 
How about we just give the option of where we want the money invested? If you want it invest in SS you can. If you want it invested elsewhere you can?


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Aberration said:
How about we just give the option of where we want the money invested? If you want it invest in SS you can. If you want it invested elsewhere you can?


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What money?
 
Aberration said:
How about we just give the option of where we want the money invested? If you want it invest in SS you can. If you want it invested elsewhere you can?


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OK, but that must be coupled with the removal of any right to later claim public entitlements should that person become disabled or their "private option" funds run out. Which opens another huge can of worms - what of that person's dependents (spouse or children)? Are they also considered to be ineligible for public assistance if the "private option" to SS is not sufficient to support their needs?
 
LesGovt said:
Good question. Current people would maintain 100% and that might be true for a period of time, for example those 57 and older. If under 57, the payout from Social Security would decrease and the amount of private funds would increase. Money that goes into Social Security are not "contributions," they are taxes. Money would still be going into Social Security for years to come until those taking out of Social Security have died. That amount would become less year by year.
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That doesn't fix the funding issue though. SS is not a savings plan. It is a wealth transfer from younger workers to older people.
 
LesGovt said:
This is very interesting. Maybe you shouldn't run around with crooks and/or liars.

I began investing in February of 1992. I never lost a penny on my investments. Not one. Of course, I did not do day trading and I did not invest in Wall Street. All I did was invest in mutual funds and let dollar cost averaging take care of the rest. Life has been wonderful ever since and now I am happily retired. You really ought to try it.
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If you invested in mutual funds starting in 1992, then you sure did lose money in your investments for periods of time. Particularly in 2000-2001 and in 2008. However, if you did not retire in 2001, then you would have made the money back again after a few years. The same is true in 2008. The problem is had you had to retire in 2001 or 2002, or 2008 or 2009, then you certainly would have been left with less money in your 401k / IRA than you planned to have. This is why it is important to start investing in a 401k or IRA at a very young age.

Also, if you are investing in mutual funds, unless they are foreign investment funds, you are investing in Wall Street.
 
ttwtt78640 said:
OK, but that must be coupled with the removal of any right to later claim public entitlements should that person become disabled or their "private option" funds run out. Which opens another huge can of worms - what of that person's dependents (spouse or children)? Are they also considered to be ineligible for public assistance if the "private option" to SS is not sufficient to support their needs?
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Which would never work because as a country we would not be willing to tolerate huge numbers of seniors living in squalor because they didn't invest well (or at all), and thus we would bail them out anyway.
 
Right now the average 401k balance for Americans age 55-64 is 178k. The median 401k balance for Americans age 55-64 is just 66k. So lets say we do away with SS and allow people to invest those funds instead. Think about this. With a 401k, where you get free money from your employer towards your retirement - all you have to do is invest enough to get matching funds, the median amount of money Americans nearing retirement have is just 66k. So lets do away with SS and assume that number triples to nearly 200k. That is still just a fraction of what a household would need in retirement. Most people are terrible long term planners. Blame evolution for it, but just the same, most people are terrible at handling long term risk. So we would end up having to bail out tens of millions of Americans in retirement anyway because they would not save enough. Thus what is the point? At least with SS we know what we are all on the hook for.
 
LesGovt said:
Would you be in favor of an investment plan that would be phased in over the next 20 to 50 years, where at the end no money would go to the Federal Government? You could invest in mutual funds or Certificate of Deposits on a weekly basis of 12% of your income with 6% coming from your paycheck and 6% coming from your employer. You could not touch the money under the same basic terms as Social Security.
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A laudable goal, but won't happen. SS was originally sold a pay as you go plan, which was a lie. The first recipient had put not a dollar into the pot.

Government needs the money to redistribute and for other uses as it sees fit.
 
What if...? said:
No.

Because wall street would just connive to take it.

That's what wall street is for.
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So it's better for the government to just take it.

That's what government is for.
 
NO! Not until they take my last check from my cold dead fingers!
 
Aberration said:
The money taken from our pay checks and matched by our employer.


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Oh. I understand. That will be fine, when all of the present recipents and insured no longer receive payments. This is the case, as the SS system has no reserves and is essentially a Ponzi Scheme or more politely spoken a hand in mouth construct that tends to require more cash outflow than it takes in.
This means that the 'tax' could increase by half or even double depending on how it is structured, level of interest rates, growth of the economy etc. This is the challenge of fixing poorly constructed economic structures that were not fixed, when there was time. It is a wonderful demonstration also of why it is such a bad idea to
a) produce private goods publicly and
b) centrally.
 
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SouthernDemocrat said:
Which would never work because as a country we would not be willing to tolerate huge numbers of seniors living in squalor because they didn't invest well (or at all), and thus we would bail them out anyway.
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Yep, but the greedy and young will never acknowledge that fact.
 
LesGovt said:
Would you be in favor of an investment plan that would be phased in over the next 20 to 50 years, where at the end no money would go to the Federal Government? You could invest in mutual funds or Certificate of Deposits on a weekly basis of 12% of your income with 6% coming from your paycheck and 6% coming from your employer. You could not touch the money under the same basic terms as Social Security.
Click to expand...

It depends on where they money is invested. California floated that idea, but the problem was the state would not exempt itself from investing some of the money in worthless state bonds, thus padding the budget with the money.

Governments cannot be trusted with you money. Ever.

I would be open to say 15% as an optional contribution, but you might as well use a private IRA and avoid all the political wrangling.
 
LesGovt said:
Would you be in favor of an investment plan that would be phased in over the next 20 to 50 years, where at the end no money would go to the Federal Government? You could invest in mutual funds or Certificate of Deposits on a weekly basis of 12% of your income with 6% coming from your paycheck and 6% coming from your employer. You could not touch the money under the same basic terms as Social Security.
Click to expand...

No, just phase it out. Individuals are responsible for their own retirement, not any govt.
 
SouthernDemocrat said:
Which would never work because as a country we would not be willing to tolerate huge numbers of seniors living in squalor because they didn't invest well (or at all), and thus we would bail them out anyway.
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So long as youre the one voluntarily bailing them out, Im ok with that. You have no power to force others to join you.
 
chuckiechan said:
It depends on where they money is invested. California floated that idea, but the problem was the state would not exempt itself from investing some of the money in worthless state bonds, thus padding the budget with the money.

Governments cannot be trusted with you money. Ever.

I would be open to say 15% as an optional contribution, but you might as well use a private IRA and avoid all the political wrangling.
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I remember back in the early to mid 2000s when many conservative economists were lamenting the low rate of return on Social Security because it was invested in treasuries, thus their suggestion at the time was to invest it in the safe investment of mortgage securities. Can you imagine what would have happened.
 
SouthernDemocrat said:
I remember back in the early to mid 2000s, when many conservative economists were lamenting the low rate of return on Social Security because it was invested in treasuries, thus their suggestion at the time was to invest it in the safe investment of mortgage securities. Can you imagine what would have happened.
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And there is that...
 
jonny5 said:
So long as youre the one voluntarily bailing them out, Im ok with that. You have no power to force others to join you.
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Yeah well good luck with that one because here in the real world, the reality that we all actually live in, the government would indeed bail them out and we would all pay for that.
 
Aberration said:
How about we just give the option of where we want the money invested? If you want it invest in SS you can. If you want it invested elsewhere you can?


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I'm okay with that so long as private investors don't pay taxes for Social Security.
 
SouthernDemocrat said:
That doesn't fix the funding issue though. SS is not a savings plan. It is a wealth transfer from younger workers to older people.
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And at the end of the 20 to 50 years, it would not be a transfer to anyone other than yourself or your heirs.
 
LesGovt said:
And at the end of the 20 to 50 years, it would not be a transfer to anyone other than yourself or your heirs.
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What prevents you from doing that now anyway? I invest 15% of my income in my 401k.
 
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