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Social Security Fix

Your Identity and For/Against this SS Reform model


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Anyone who has studied history should understand that government is the worst of all entities to protect your money. Social Security would not have even passed through the courts had it not been for the "Switch In Time That Saved Nine." In fact the SCOTUS gets a bit whacky with its precedents after FDR threatens to stack the courts.

:D i once had a professor tell me i needed to get over Wickard v Filburn already.

I have some questions CP. Firstly, how are you to force people to pay 5% of their paycheck into a TSP like account?

currently they are putting 7.6% into the Social Security trust fund via the FICA tax. my plan would merely divert 5 of the 7.6% to a personal plan.

Are you going to mandate it?

nope, folks will have the freedom to opt in. perhaps to make it more politically palatable we could offer folks an "opt back" upon retirement, but i would bet that not many would willingly give up that much money.

Secondly, employers are not going to pay 2.65%.

they already do.

They are going to write those costs off to the consumer

actually i think most economists are generally uniform in claiming that payroll taxes come out of compensation. :shrug: but i could be wrong.

In effect you are levying another tax.

no, i am diverting a current tax; which is why i claim that this plan will produce these results without costing my Joe's any money; their tax burden will not increase.
 
I had a professor tell me roughly the same CP. I quickly asked him if we would be studying Locke and Rousseau or would he just be promoting a Hobbesian philosophy? I still got an "A' but I don't think he liked it.

Good answers CP. I cannot argue with it. But what happens to my 5% investment after I die? Is it my money or is it still the same ponzi scheme as Social Security?

Ax
 
:) i would say it goes to your kids. but if we had to fold it back into the trust fund to make it fiscally sound, that's a compromise i'd be willing to make. perhaps it would go to your kids, but get taxed at income rates.
 
I had a professor tell me roughly the same CP. I quickly asked him if we would be studying Locke and Rousseau or would he just be promoting a Hobbesian philosophy?

i view Hobbes as merely existing further down the pyramid of needs. we need a leviathan before we cans start worrying about individual liberty and limited governance.
 
i view Hobbes as merely existing further down the pyramid of needs. we need a leviathan before we cans start worrying about individual liberty and limited governance.

Not sure I can agree with you. I look at Hobbes and I see Mussolini in his previous life. I will agree we need government to guarantee security, and I will agree that government is a necessary evil but it does not necessarily need to be as Hobbes viewed it.

Ax
 
Not sure I can agree with you. I look at Hobbes and I see Mussolini in his previous life. I will agree we need government to guarantee security, and I will agree that government is a necessary evil but it does not necessarily need to be as Hobbes viewed it.

Ax

what i'm saying basically is that order out of chaos is the first (painful) step in development, and that if it's development comes at the expense of individual liberty; people will consider that little comparative cost.
 
Even that wouldn't come close to fixing SS. The trust fund deficit is $2t, while the unfunded liabilities are $17t.

You are very off base (quite wrong) on this, sir....

As a stand-alone entity, the social security trust fund is quite solvent and currently profitable on a year-over-year basis.

Note balance sheet of Trust fund with $2.3T in equity as of 9/30/08: A Look At Social Security

Of course, all of the assets of this trust fund are in US Treasuries. The fund buys Treasuries with its proceeds and the cash, of course, is loaned to the US government for normal activities, like building infrastructure, running the government operations and defense. As of January 31, 2011, the total national debt was $14.1T, of which $4.6T was intragovernmental debt (owed from one department to another)... substantially all of it to the social security trust fund. This meant the government owed $9.5T to the public.

That all said, this is all accounting as there is no real trust fund. It is just a set of books, just as the money you have at the bank is not really there, only the obligation to you is there on the bank's books. But, the social security administration collected some $4.6T from payroll taxes and loaned it to the government for interest.

The problem with you and many others is inconsistent argumentation. If you want to say the national debt is $14.1T, then you must include the $4.6T owed to social security (an asset to that fund), meaning social security is quite solvent and profitable. On the other hand, if you want to say that money loaned by FICA is never going to be collected, then the national debt is $9.6T and to use a higher number is intellectual dishonesty. Pick one.

I take you for a $14.1T debt guy, meaning FICA is quite solvent.

As social security is a pay as you go system, it has no unfunded liabilities. If you want to do accounting as defined benefit pension plan, a valid position, then we have a different situation.

The fundamental problem, however, and the sham that has be perpetrated on the American people is the increased reliance on payroll taxes (largely social security) to make up for the fact that we are letting our corporations get away with tax larency (their tax contributions have been falling, yet profits rising over the past three decades).
 

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When a poor uninsured person uses the ER and doesn’t pay, your out of pocket cost for the ER goes up and you insurance premiums go up. When a drunk driver totals his and another’s car, you pay because the insurance company raises everybody’s rates. When a coworker screws something up (CEO or assembler) you pay because you work there (you might have been on the platform), or you fish the gulf, or you buy gas, or of if you bought BP stock before the blowout. (I bought after the blowout, sold a while ago, did great.) Yup, you pay for people that make stupid decisions in life all the time, and more than you think. I was pissed when I figured that out.

What you fail to realize is that the poor and helpless didn't have the lucky breaks you and the other cold fish had. Finding jobs isn't about education. It's about being at the right place at the right time, the right kind of experience, and the right kind of boss.

It isn't about your decisions, a willingness to work, or how hard you look for a job. It's about how many lucky breaks you get along the way.

Think back to when you got your first job and you'll see what I mean.

There but for the twists of fate go thou...

ricksfolly
 
The obvious problem is that if enough people opt out of Social Security, you won't have the money on hand to pay those who've already paid into it, making for a bunch of very angry senior citizens who will seize their dentures and pitchforks, march on Washington, and leave a wake of rubble and destroyed buildings - okay, I'm getting carried away here, but you get the idea.

While I think health care is a Constitutionally supportable concept (though I opposed the specific bills put out recently) I don't see how retirement fits under 'life, liberty, and the pursuit of happiness' or why the government should be covering it. It would be nice to end Social Security. The problem is that to cover those who are receiving benefits from the system while stopping more people from putting money into the system, or privatizing, or opting out, any of that, you need a lot of cash resources on hand - and the government right now is bankrupt, not even able to stop borrowing.

The simple way to do this is just change the retirement age. When Social Security was passed, the average life expectancy was 62, whereas now it's 70. We're paying for 8 more years of retirement than was intended. Just change even half of that and the system becomes sustainable and profitable again. Not to mention it would have a surplus built up if politicians didn't keep borrowing from the Social Security trust fund to pay for everything else...

Maybe we can end the system later, but right now we just can't afford to.
 
Also, I'm an independent and against, so I can't vote :(
 
What you fail to realize is that the poor and helpless didn't have the lucky breaks you and the other cold fish had. Finding jobs isn't about education. It's about being at the right place at the right time, the right kind of experience, and the right kind of boss.

It isn't about your decisions, a willingness to work, or how hard you look for a job. It's about how many lucky breaks you get along the way.

Think back to when you got your first job and you'll see what I mean.

There but for the twists of fate go thou...

ricksfolly

What? I don’t realize because I didn’t mention it? I don’t know how that follows.

Of course luck has a lot to do with how successful someone is. It may be impossible to overcome very bad luck. However, the individual has a lot of control. I have many stories of how I changed my bad luck into and opportunity that almost made up for the bad luck. Do that enough in America and you can usually end up acceptably well off. Don’t and you end up poor or very poor.
With your comment you are headed into a hole that is hard to dig back out of.
 
Social Security was designed from the start as redistribution. It was just called something different to get people on board.

When it was enacted the average life expectancy for a male in the U.S. was 59.9 and for the female 63.9. The retirement age was 65. The idea was to collect monies from some workers which would never receive them and give them to others.

You have to remember people in that era usually worked long after 65. Social security wasn't more than they could make working. The business community was different as well. Companies kept older employees because they valued their experience and insight.

As it was designed it probably would have limped along for quite a while. The politicians kept adding more and more categories of people to receive benefits. Where now even non-citizens or other nationals can collect benefits whether they have paid into the system or not.

Since the politicians will not revise the definitions of possible recipients the only logical thing is to go back to the original model and raise the retirement age beyond the average life expectancy which currently is 78 years. Maybe retirement age should be 85.
 
The simple way to do this is just change the retirement age. When Social Security was passed, the average life expectancy was 62, whereas now it's 70. We're paying for 8 more years of retirement than was intended.

Not as easy as you might think. You'll have to get employers to go along. Most companies want younger, cheaper employees. And even if the companies do comply, you still need to convince insurance companies. They don't cover anyone over 65.

ricksfolly
 
Of course luck has a lot to do with how successful someone is. It may be impossible to overcome very bad luck.

Luck, fate, karma, chance, destiny or kismet has power no one can resist.

As Plutarch wrote centuries ago...

Fate leads him who follows it and drags him who resists.

ricksfolly
 
Luck, fate, karma, chance, destiny or kismet has power no one can resist.

As Plutarch wrote centuries ago...

Fate leads him who follows it and drags him who resists.

ricksfolly

Luck – yes, fate – no, karma - modifiable, chance - yes, destiny/kismet –no.

Plutarch was incorrect. People (dogs too) are independent actors restrained by situation and moment. There are choices. Why would you even discuss this point if you believed what you are saying?
 
The obvious problem is that if enough people opt out of Social Security, you won't have the money on hand to pay those who've already paid into it, making for a bunch of very angry senior citizens who will seize their dentures and pitchforks, march on Washington, and leave a wake of rubble and destroyed buildings - okay, I'm getting carried away here, but you get the idea.

that's why people under this plan - should they opt out - continue to pay in 5.1%, and we pop the cap.
 
Plutarch was incorrect. People (dogs too) are independent actors restrained by situation and moment. There are choices.

Memory of what we did or didn't do in similar situations triggers our response.

Your post, for example, triggered my response.

ricksfolly
 
Memory of what we did or didn't do in similar situations triggers our response.

Your post, for example, triggered my response.

ricksfolly

My post was part of pull on your trigger; however, part of the other part is chaos. Without chaos there would be no independent action, with chaos there is. It’s neat how that works. Nothing, or almost nothing, is deterministic in the physical world.
 
I am for privatization of Social Security or having private accounts for each individual. I am tired of paying for dead beats with out jobs that are multigenerations on welfare, or illegals getting an "anchor" baby and living on social security. If you didnt put a pay check into your bank account then when you want that bag of chips you would not be able to purchase it. It is the same concept. Someone getting something for nothing. Also why would the idiot in the white house want to raise their standard of living to match lower middle class. These people work for a living and strive to make ends meet and save a little and Obama The Fool says it is not right that people on welfare and social security have to do without. HELLO its called get a job and save up.
 
HAH, it just occurs to me. all the democrats are voting the exact same as the socialists :)
 
The Fool says it is not right that people on welfare and social security have to do without.

Did the POTUS actually say that, or do we categorize your statement along with the birther nonsense, or perhaps the pres as a Muslim and a Marxist?
 
I am for privatization of Social Security or having private accounts for each individual. I am tired of paying for dead beats with out jobs that are multigenerations on welfare, or illegals getting an "anchor" baby and living on social security. If you didnt put a pay check into your bank account then when you want that bag of chips you would not be able to purchase it. It is the same concept. Someone getting something for nothing. Also why would the idiot in the white house want to raise their standard of living to match lower middle class. These people work for a living and strive to make ends meet and save a little and Obama The Fool says it is not right that people on welfare and social security have to do without. HELLO its called get a job and save up.

Ok lets get this right ok :) There are some deadbeats on SS disability no doubt there are some illegal immigrants therefore some getting something for nothing.
However, the lionshare of people on Social Security Paid it their entire lives.
Ill use myself as an example: I am 63 yrs old, I got my working papers at 12 yrs old. I have worked on the books all my life. I was FORCED into Social Security, I was given no choice to invest that money elsewhere, the govt took it from my paycheck every week religiously. Ive paid into social security for 47 yrs. Im not a deadbeat, a bum or a freeloader...Just an american who worked all his life and paid in to social security and paid all my taxs...and I still am.
Most SS recipients are a reflection of ME...not those you described.
I am for SS reform but none of the solutions tha have been put forward yet by Dems of Gop
 
Ok lets get this right ok :) There are some deadbeats on SS disability no doubt there are some illegal immigrants therefore some getting something for nothing.
However, the lionshare of people on Social Security Paid it their entire lives.
Ill use myself as an example: I am 63 yrs old, I got my working papers at 12 yrs old. I have worked on the books all my life. I was FORCED into Social Security, I was given no choice to invest that money elsewhere, the govt took it from my paycheck every week religiously. Ive paid into social security for 47 yrs. Im not a deadbeat, a bum or a freeloader...Just an american who worked all his life and paid in to social security and paid all my taxs...and I still am.
Most SS recipients are a reflection of ME...not those you described.
I am for SS reform but none of the solutions tha have been put forward yet by Dems of Gop

What really needs to be done is to take SS out of the general fund, start paying back those IOUs, and quit paying out the money to people who didn't pay into the system.

I'm not on SS, don't qualify. I do qualify for California state teacher's retirement. Teachers here pay 8% into the fund, just like SS, matched at 8% by the employer, just like SS, but the money gets put into a trust fund and the excess invested, unlike SS. Also unlike SS, a teacher with 30 years in can retire at 72% of final salary at the age of 62. Unlike SS, the STRS fund is solid and unlikely to go broke any time in my lifetime, or probably ever. The only difference is that the money was not raided in order to help balance the budget.
 
Ok lets get this right ok :) There are some deadbeats on SS disability no doubt there are some illegal immigrants therefore some getting something for nothing.
However, the lionshare of people on Social Security Paid it their entire lives.
Ill use myself as an example: I am 63 yrs old, I got my working papers at 12 yrs old. I have worked on the books all my life. I was FORCED into Social Security, I was given no choice to invest that money elsewhere, the govt took it from my paycheck every week religiously. Ive paid into social security for 47 yrs. Im not a deadbeat, a bum or a freeloader...Just an american who worked all his life and paid in to social security and paid all my taxs...and I still am.
Most SS recipients are a reflection of ME...not those you described.
I am for SS reform but none of the solutions tha have been put forward yet by Dems of Gop

you're 63. the GOP options wouldn't effect you at all.
 
What really needs to be done is to take SS out of the general fund, start paying back those IOUs, and quit paying out the money to people who didn't pay into the system.

ah yes. and with what money, pray tell, we going to be achieving this laudable goal?
 
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