Published: Monday, July 28 2014 12:00 a.m. MDT
In my opinion: Social Security is a Ponzi scam and will crash of its own weight.
For social security the problem is the regressivity of the payroll tax.
According to Senator Bernie Sanders we should apply the Social Security payroll
tax on income above $250,000. Applying the Social Security payroll tax on income
above $250,000 would only impact the wealthiest 1.3 percent of wage earners. In
other words, 98.7 percent of wage earners in the United States would not see
their taxes go up. The social security trust fund is solvent until 2030.
Lifting the cap on taxable income would extend social security an additional 50
years.Social security has been a winner and has rescued many elderly
from abject poverty. Before social security it was a race to see which would
kill off the elderly first - ill health or lack of nutrition.
SS is a fairly easy fix. 1) delay benefits2) increase taxes
to cover it.3) a combination of the 2 above makes the most senseMedicare/Medicaid are much tougher problems.Fixes include1)
reduce benefits2) work to cut medical costs3) raise taxes to pay for
itOf the 3 above, working to cut medical costs seems to make the
most sense as cost are huge compared to the rest of the world.All we
need to do is convince about 1/2 of the country that medical costs need to be
controlled.The longer we wait, the tougher these problems become.
And lately, all our congress HAS been doing is waiting and pushing the problem
down the road.
Contrary to what Republican politicians hope we'll believe, most of us know
that Social Security is an insurance that we working Americans pay for during
our working lives, not an "entitlement" whatever that is. Republican
attacks on it are the biggest threats Social Security faces.
Social Security is one program that is absolutely vital to the health of the
nation but also a program that one would expect would have to be "fixed"
periodically with changing demographics and economic situations. It's
impossible to see 50 years ahead so adjustments should be expected. Luckily Social Security has some very easy fixes we just need the will to do
The only reasonable solution is one that no one is talking about. I have
proposed that we gradually increase the age that people receive benefits from
these programs, increasing it by 6 months per year until we get it to 72 years
old. At 60 years old, that affects me as much as anyone, but it is the right
thing to do. While it would be nice if the money we pay in could be privatized
so it was available to us when we need it, that is not workable in the short
term. This approach will decrease costs substantially in the long run and is
more reflective of how long people live and can and should be productive
compared to when Social Security and Medicare were created.
Anyone who thinks SS is a good deal does not understand math or compounded
interest!M = P( 1 + i )nM is the final amount including the
principal.P is the principal amount.i is the rate of interest per
year.n is the number of years invested.Look at the FICA
deduction on your next paycheck and include what your employer is forced to
contribute and plug those yearly numbers into the above formula for say..40
years! Assign any modest interest rate, compounded for those 40 years! If we had
been "allowed" to invest that money in any simple investment, nearly
every American would retire as multi-millionaires. Congrats Americans, your
government hosed you again!
Lumping Social Security and Medicare together is highly obfuscatory. Social
Security's problems are relatively minor. SS currently consumes 5% of GDP,
that will rise to 6% by 2035 where it is projected to remain. A small tax
increase coupled to a small benefit cut will take care of it.Medicare and Medicaid, on the other hand, is where all of the future deficits
problems originate, But if we were to get our medical spending down to the level
of Germany, or France, or Japan, or any other developed country, we would solve
almost all of long term deficit problems.
Mountanman.Had SS been invested, it would be a great program.But alas, our great and wise elected leaders, Both R and D alike, saw
free money and used it in an effort to buy votes and keep taxes low.So, what we have is a decent program that was hijacked by politicians (even
your beloved Republicans)
To Shaun McC: People in their 50's are already having a hard time finding a
job. Employers do not want 70 year old employees Increasing the retirement age
won't work for that reason, unless we very vigorously enforce anti-age
discrimination laws. Also many people in physically difficult work environments
simply cannot keep working that long.
If we stopped trying to be the police force for the world and started taking
care of our selves, we could afford a lot of things.
"...Unsustainable might be an appropriate term for the seemingly lackluster
interest from Capitol Hill lawmakers, outside of Utah Republican Sen. Orrin
Hatch and a few others. The report, stated Hatch, is a stark reminder of the
urgent need for entitlement reform...".It's good to read
Hatch is aware of something.Hatch has been in the Senate since
1977.It's good to read Hatch sees anything as being urgent."...Actually, the feds financial picture right now isn't dire,
given budget cuts and tax increases. The CBO projects a U.S. budget deficit of
$492 billion this year, the lowest since 2008 and nearly a third of the record
$1.4 trillion in 2009...". Actually, it's surprising to
read this report in the DN."...Americans are hesitant to see
reductions in Social Security benefits. A recent Pew Research Center study shows
67 percent want no reductions at all in benefits,...".Those
Americans who are hesitant to see reductions in Social Security represent the
voting base of the Republican Party.Republican law makers will slash
Social Security benefits for their voting base.Right?
Re: "The social security trust fund is solvent until 2030."No, it's not. There is no social security trust fund. Any more than there
exists a Social Security fairy.Here's how the welfare-system
Ponzi scam works -- current benefits are paid out of current receipts. Current
excesses are applied to other general-budget items, with an understanding
they'll be paid back out of future receipts. Resulting, of course, in
unsustainable systemic debt.To say that Social Security is solvent
until 2030 must be translated from liberal newspeak as: "CBO hopes --
that's all they can do, there's no real way to predict -- that current
receipts, plus redemption of government debt instruments will meet current
expenditures until 2030."But a "lockbox," into which
current excesses are placed, ready to be used when needed in the future? Nothing
but disingenuous accounting fantasy -- Social Security fairytale.Best time to begin solving this problem? Back when President Bush suggested
it, and liberals fought it off. Second best? Now, but liberals will never let
the issue be solved.They'll continue to press the Social
Security fairy approach until it all collapses.Sad.
"Best time to begin solving this problem? Back when President Bush suggested
it,"Are you talking about just before the stock market crashed
Ida Mae Fuller, the first SS recipient, paid less than $25 in SS taxes. She
then received almost $23,000 in SS welfare payments.Thus Social
Security has been a Ponzi scheme from the very beginning. Eventually all Ponzi
schemes collapse as the number of those who reach the receiving end grows until
it can no longer be supported.Second, Social Security is a tax, not
an investment. The money taken from you today isn't being stored in any
account waiting to you to cash it out on a later date. Money taken from you is
immediately being given to one of the SS welfare recipients (remember that this
is a Ponzi scheme and has been since the first recipient). Those notices from
the government telling you about an account with your name on it? Those are
fiat accounts, meaning they only exist in an arbitrary sense and not a literal
one.Before solutions can be found, we must first face the reality of
The real problem Medicare and Medicaid. The high cost of health care, and the
lack of savings to prepare for paying health costs in retirement is both killing
the competitiveness of American businesses, and leaving us unprepared to pay for
medical costs in old age. The problems? 1) A lack of open markets in health
care (consumers don't feel the full impact of their health choices so they
spend less time shopping for good medicine than they do for a $600 television)
2) with limited information available to consumers 3) Poor dietary and
health/fitness choices 4) Under-educated workers who do not contribute
sufficient value to cover their own health costs.Until we start to
address the real underlying issues, the problems will continue to grow.
So what if you think Social Security is a Ponzi scheme. So what if it a
"redistribution" of wealth.Well, you get the point. So what.It is a program that US citizens rely on for a modicum of security in
their old age. We may argue endlessly about when "old age" begins and
what a modicum of security means in actual dollars. However, we are not going
to abolish the system.The best advice to all sides of this political
debate is to find common ground, compromise and give the American people comfort
knowing this safety net will stay in place. Sadly, even power Senators like Mr
Hatch can not seem to find this common ground and actually do something positive
for the majority of Americans. I don't blame him, but just where does the
buck stop in the Congress and the Senate? Can they every draft any kind of
compromise legislation, or are they going to continue to bicker like fishwives
(apologies to the spouses of fish mongers, its a vivd metaphor if misogynistic).
Social Security would've been just fine if the politicians from both
parties hadn't raided and plundered the trust fund from the 1960's to
Obama has proposed cutting SS benefits by tying them to CPI, thus maintaining
solvency forever. In return he wants certain loopholes for rich taxpayers
closed. This is a fair and responsible compromise, but the House
Republicans won't even talk. Sheer obstructionism.
I'm a young guy - 28 years old. I would much rather be legislatively
required to personally invest the SS "tax" that hits my pay check than
kiss it goodbye without any hope of seeing a dime back when i retire in 35-40
years.When the government does for someone what they can do for
themselves, everyone loses except the government.They have used this
"tool" to buy votes. R's and D's. No other explanation for
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