Down Your Throat, America!!!

[SicTimMitchell]

http://story.news.yahoo.com/news?tmpl=s ... alsecurity

[Partha]

Ok, this is just plain silly. On all sides.

[Relbeek Einre]

Social Security is one of the best government programs ever implemented. It's not broken, hasn't been broken, and much of the conventional wisdom that says it is is nothing more than hype.

But Bush wants to line the pockets of his rich friends, so turning FICA taxes into investment dollars works for that, at the people's expense.

[Narith]

Ok let me see if I figured this out correctly, the "change" needed is a huge (probably close to 5 to 10% extra in taxes) add into social security taxes. So the government will take another 5 to 10% (geussing on those figures) and tack it onto the social security tax that you do not get back at the end of the year, they will inturn use this extra money to fund the war or other government programs?

Maybe I misread, but from what I understood he wants to rehaul the entire tax code because the government is falling short on the current social security. Which we wouldn't be if when social security was set up they invested the money instead of spending it on government programs then when came time for people to collect they needed to withdraw the money from other programs.

[superwalrus]

Social Security is one of the best government programs ever implemented. It's not broken, hasn't been broken, and much of the conventional wisdom that says it is is nothing more than hype.

Wow, just wow. I really can't believe there are people out there that believe this.

Walrus

[Partha]

Some observations:

Currently, it still collects more in revenue than it outlays. As the article mentioned, it will still do this for about a decade to 15 years, if nothing changes.

The GAO study that everyone quotes says that, if you do nothing but run off what's collected (including refunding the money that's been used to artificially buy down the budget deficits), you maintain full funding and benefits until 2048? or so, at which point, you achieve equilibrium at 80% of benefits.

By 2050, the baby boomers will be approaching a median age of around, what, 80? 90? Do the numbers in the GAO study reflect aging increases? Do they estimate how many boomers will still be alive at that point?

One can't be disqualified from getting a check if one waits to file until age 65, if I'm to believe the SS website. Now, no offense - I like Warren Buffet just fine, but I'm pretty sure he doesn't need that check, and neither will many of the top tax bracket folks. Why can't they be disqualified? (Yes, before you froth, I know this doesn't save tons of money.)

Why is the amount one can be taxed on SS capped where it is? Can it be changed? Can certain current qualifications be removed or restricted further, like survivor's benefits? There's way too many basic questions that can and should be asked and answered seriously and in a nonpartisan way before we decide the whole thing is junk.

[Syeni Soulslasher MK6]

Problem is there are a shit load of boomers coming onto retirement age and people are only looking at the much smaller numbers of Gen X to fill the void by the Boomers.... They fail to see that whaat they call it Gen Y? (generation after Gen x) rivals the boomers in numbers will be plent of people to shovel cash back in to SS..

[SicTimMitchell]

In other words, if people would just fuck more and die faster, we'd come out ahead.

I think I've found my campaign platform.

[JamiesanTGrauerwolf]

Live fast, die young, and leave a beautiful corpse... and a bunch of babies?

[vaulos]

You've all missed the interesting bit of this entire story: campaign ads are now year round. Welcome to the new world, where everytime you want to change a law, it takes not only an act of God and Congress, but also a $20 media campaign.

[Partha]

That will be $20, please.

[Eidolon Faer]

You know, even with a couple of complete wipeouts, I could probably STILL earn a better return over 35 years of work investing the money myself than the SSA will give me. And that's not even counting the risk that the SSA will be bankrupt when the time comes for me to collect. I'd sooner buy Haitian Penny Stocks.

Hell, as long as I don't smoke in bed, stuffing it into a mattress is a more-productive investment. Do you have ANY idea how shitty the effective interest rate of Social Security is?

But what I really find entertaining is how the Left is coming to these boards and defending a REGRESSIVE tax. Yes, regressive. Not even flat-rate.

If we're going to fix the system, the time to do it is NOW when we still have enough money coming in to cover current obligations.

[Partha]

And, of course, you can gaurantee that you'll end up with a better rate of return, regardless of what the economy does. Placing the burden of investment on people who likely have little to no knowledge of advanced economics is, to my mind, little better than having them buy lotto tickets. Of course, we can prove this - take about $20 a week out of your paycheck and have your local cashier at Walmart invest it. After all, it's easy to make a profit in the market, right? You'll be a millionaire before you know it!

As far as the SSA being bankrupt, the GAO study specifically notes that that will not happen. Can we get a little less hyperbole this early in the morning? It causes cavities.

[SicTimMitchell]

Okay, look.

SS is something I've paid into my whole adult life, and I'm especially concerned for survivor benefits for my wife.

But it was originally meant to be a safety net for poor old people, not some extra cash for rich folks like my wife and myself.

I admire the rich people who give their SS checks back to the gummint, or to political concerns of whatever stripe, or to charity.

Will I do it? Prolly not. Still have that greed monkey on my back.

[McBash]

One of the biggest problems with SS is the way is segregated. Thats nothing more than a sham as its turned out. We want SS as a society? fine, just add it to the budget and adjust tax rates accordingly, and lose the 'payroll' tax aspect of its. There really is no such thing as SS accounts and the way we have done this social program so far is just about as inefficient and disingeniuos as possible.

Its a social program, like wellfare, public education, transportation, whatever, and trying to segregate it was expediant at the time, but short-sighted and fool hearty. Absorb it into the general fund and stop pretending its 'special',

For those who want to privatize SS, why? We've allready subsidized private retirement investments via tax code, so that opportunity already exists for those who want to and are able to.

I just see this as yet another made up issue that politians use for divisive debate.

McB

[Eidolon Faer]

Partha...

First of all, if we're talking about hyperbole, if the hypothetical "really stupid member of the public" took $20 per week out of his paycheck and bought Treasury Bills, that'd still be better for him than putting the same money into the SSA. The interest rate on Treasury Bills is like four times what the SSA pays and the risk is no higher.

And even if the person is willfully stupid and lost everything, he'd still have the other 90% of his withholdings that would still be going to the SSA to collect when he retired.

Government employees already have the option ot "opt out" of Social Security, and it's proven to be an incredibly good deal for them. Why does the trained monkey at Wal Mart deserve to get screwed worse than the trained monkey at the Drivers License office?

The 1980's showed us that pension funds are unsafe, because the money is not in an account in your name. It is in the company's name, and all you have is the company's promise to pay you. And corporate raiders weren't exactly trustworthy in honoring those promises.

That is the genius of the 401(k). The money is in your name. No company exec can spend it out from under you.

Several times, Los Angeles County has tried to raid the pension fund of its' own employees. Unfortunately, the organization that oversees it, LACERA, is an independent corporation, and the county was unable to gain access to the money, even after a battle in court.

Clearly we have at least one example of an "evil corporation" being more trustworthy than the government. Is it totally unreasonable to consider privatizing social security in the same way the 401(k) privatized pensions? Clearly, the California Legislature is no more fiscally trustworthy than the Board of Directors at Enron. Do you really want Congress to be able to spend your retirement money without asking?

[McBash]

Eid, your problem is that you see Social Security as an program for individuals, its not. It is a social program, the funds collected for it are not for personal accounts, and havent ever really been. The entire concept of us each having indidual accounts is a ruse.

Its time to stop the farse and move this program into the general fund and be done with it, im tired of hearing about it. While we are at it, kill the payroll tax associated with it, and raise federal rates to compensate for that.

McB

[SicTimMitchell]

Eidolon,

Maybe you didn't notice, but the stupidity of the 401(k) is that the market can crash and you can end up old and destitute. Instead of the hands of your employer, your retirement is in the hands of sometimes incompetent and sometimes dishonest brokers.

And I think you're overly optimistic about the bond market.

[SicTimMitchell]

Oh, and one more thing I don't think a lot of folks realize:

For every dollar you put into SSI, your employer has to match it. It's very rare that employers do the same for 401(k)s. (Some will match a portion, but not all.)

I think this is what the administration really wants to eliminate.

[Eidolon Faer]

Eid, your problem is that you see Social Security as an program for individuals, its not. It is a social program, the funds collected for it are not for personal accounts, and havent ever really been. The entire concept of us each having indidual accounts is a ruse.

Its time to stop the farse and move this program into the general fund and be done with it, im tired of hearing about it. While we are at it, kill the payroll tax associated with it, and raise federal rates to compensate for that.

McB

Actually, McBash, I'm well aware of how the money is spent as soon as it comes in and how the SSA has nothing but IOU's in each individual retiree's files, which it hopes to pay off with current revenue from workers still paying into the system.

That's my big problem with Social Security. That's why I compared it to a pension fund, with Barbara Boxer playing the role of the corporate raider. As the baby-boomers retire and the ratio of retirees to workers shifts drastically, they'll either have to default on benefits or grind the workers into dust to pay for it. They sure as hell aren't going to take it out of government spending, just look at the crap in Nevada where they had a judge overrule the constitutional requirement of a 2/3 supermajority vote to raise taxes rather than fire a few Ombudspersons and Vice Assistant Undersecretaries.

My argument is that we cannot afford to diddle around with Social Security, tinkering here and tinkering there. Social Security has been in a state of perpetual crisis for my entire life. Walter fucking Mondale campaigned on saving Social Security, for chrissakes. And gee, I've heard the "Oh, it's gonna be fixed forever THIS time" crap before. After the first eight times you stop being impressed.

Frankly, NOBODY can rely on the Gub'ment to ensure their retirement. It won't work. Your fixed income will be broken. You need to save for retirement yourself, and there's no other way to ensure your security in old age. This is, if nothing else, a way to get people into the habit of thinking about retirement themselves, and teaching them the discipline to set aside money from each paycheck.

Oh...and Bangzoom...regarding the bond market, you will still get the face value of the bond when it matures. If the US Government is defaulting on T-bills, you can damned well bet that Social Security benefits have gone the way of the passenger pigeon, and that gangs of mutants are prowling the radioactive wastelands in search of fresh brains to eat. If your T-bill fund gets wiped out, being broke will be the least of your problems.