Social Security is not going broke .. because it can't

[Cancel 2020.1]

To me, "raise taxes" just isn't a solution. I don't know how anyone can market it as such.

It's a way of punting. It's postponing a real solution, and to pretend it's anything but that is wildly irresponsible to future generations.

 

[Cancel 2016.2]

Well that'd depend on the plan wouldn't it? What's your plan? Are you going to phase in privatization? Let's say you had your wish and you could privatize SS. Would you partially privatize it? What would you do with a 25 yo right now?

So you have no idea what the costs would be? That is all we need to know.

Have you actually been reading the thread? I stated the simple fix was to create a donut hole and raise the shortfall via taxation.

Lorax brought up the privatization. I do think that is another viable alternative, but it will be a far tougher sell to the public given the constant fear mongering from the left on the issue.

The public is far more susceptible to the 'tax the rich' mantra of the left given. It is the easy way out. It is the likely way out for that reason. Hence the simple fix.

That said, if we were to privatize, I would limit the investment options to Treasury bonds and an ETF that mimics the S&P 500. I would restrict investments to a max of 50% in the S&P ETF. That 50% max would be phased down the closer a person got to retirement.

 

[Cancel 2016.2]

That's true but I was still waiting for you answer my question above about the costs of privatization. In other words, I was answering Onceler but thinking of you. You know how we women are.

Yet you could not answer what you thought the costs of privatization were?

The costs are the same for both the current system and privatization. It is only a question of how and when we have to pay for the obligations.

 

[Banned]

Onceler has this thing about SS. I try to close my eyes and not look. It's like when I met the man of my dreams and I was starry eyed enough to think he was the perfect man. And then we went to the movies, and he talked! And I hate when people talk in the movies. I couldn't believe he talked in the movies, and I was like, well there you go, he does have a fault.

We laugh about that now. You know, about the fact that I once thought he only had one fault.

Anyway, yeah, Onceler's weird SS thing is the message board equivalent of talking in the movie theatre. But what are you going to do. Nobody's perfect. Best last line of a movie ever!

Like a certain economist you onetime went to see?

 

[Cancel 2016.11]

Yet you could not answer what you thought the costs of privatization were?

The costs are the same for both the current system and privatization. It is only a question of how and when we have to pay for the obligations.

You haven't answered; full or partial privatization?

 

[Cancel 2016.11]

Like a certain economist you onetime went to see?

Sadly that is true too.

 

[Cancel 2016.2]

To me, "raise taxes" just isn't a solution. I don't know how anyone can market it as such.

It's a way of punting. It's postponing a real solution, and to pretend it's anything but that is wildly irresponsible to future generations.

Given the discrepancy in the size of generations I agree, eventually this could come back to being a problem again. Most likely when the echo boomers hit retirement. The tax hike solution will get us through the baby boomers deaths and when Gen X & Y are in retirement, the SS fund will grow again. Depending on the amount of taxation increase, income level etc... the change could potentially see the country through the echo boomers retirement years, but it is likely the ponzi scheme once again blows up.

 

[Cancel 2016.2]

You haven't answered; full or partial privatization?

Doesn't matter Darla. The costs are the same regardless.

 

[Cancel 2016.11]

So you have no idea what the costs would be? That is all we need to know.

Have you actually been reading the thread? I stated the simple fix was to create a donut hole and raise the shortfall via taxation.

Lorax brought up the privatization. I do think that is another viable alternative, but it will be a far tougher sell to the public given the constant fear mongering from the left on the issue.

The public is far more susceptible to the 'tax the rich' mantra of the left given. It is the easy way out. It is the likely way out for that reason. Hence the simple fix.

That said, if we were to privatize, I would limit the investment options to Treasury bonds and an ETF that mimics the S&P 500. I would restrict investments to a max of 50% in the S&P ETF. That 50% max would be phased down the closer a person got to retirement.

Well Bush put the initial costs of his own partial privatization at 2 trillion. He budgeted over 700 billion into his proposal for the first years.

I don't care about your last paragraph. What I want to know is how much are you planning to take out of SS in order to fund your privatization? Let's say we have a 25 yo. Would you take all of her current SS contribution and put it in private funds, or would you just allow her to invest a portion of her current SS contribution into a private account, ala Bush?

 

[Cancel 2016.11]

Doesn't matter Darla. The costs are the same regardless.

Can you show me how? I have not looked into the costs of full privatization, only partial. I remember all of those figures from the Bush scheme. How would full privatization work in comparison?

 

[Bonestorm]

A truly stupid idea. You oppose the privatization of SS because people would potentially be able to invest in the market. Yet now you say you think the government should be allowed to invest in other investments? Your faith in the government is beyond pathetic. They are completely inept. They continually try to manipulate the market to get the result they want... yet now you wish to give them an even bigger reason to manipulate it?

I don't oppose privatization because people would be able to invest in the market. I oppose privatization because it exposes vulnerable people to unnecessary risk. With the government investing, the risk is borne by the government and the collective, not individuals.

Also, too, near as I recall you want the government to restrict the types of investments people can make under a privatization scheme. So, why is the government able to select relatively low risk investment options for individuals but unable to make low risk investments for itselt? That makes no sense.

And, no, I don't want any of this to happen, but if you want private accounts because it will generate higher returns than Treasuries, why not get the hgiher returns by allowing government investment in things other than Treasuries without the risk of loss to individual account holders?

As for the 'benefit cuts'... we modify things for inflation, yet you seem to think modifying for life expectancy is somehow any different. Using your reasoning, any change would be a cut to benefits.

Well, yeah. Any change that lowers what people would recive under current law is a cut to benefits.

 

[Bonestorm]

Also, too, it should be noted that 75% of scheudled benefits in 2035 will still result in higher initial benefits than current retirees receive because scheduled benefits grow based on median earnings and earnings grow faster than inflation. So, like, doing nothing means that future retirees will still be better off than today's retirees in terms of value of payable benefits.

 

[Cancel 2020.1]

Why is there talk of "risk" with privatization? Even if investment was straight into the market, we're talking about a period of over 30 years generally.

If the market is not generating a return for seniors that is MUCH higher than their current 1.5% over that period of time, then we have much, much bigger issues going on economically.

 

[Cancel 2016.11]

Also, too, it should be noted that 75% of scheudled benefits in 2035 will still result in higher initial benefits than current retirees receive because scheduled benefits grow based on median earnings and earnings grow faster than inflation. So, like, doing nothing means that future retirees will still be better off than today's retirees in terms of value of payable benefits.

I absolutely did not know that. Never even read it. Thanks for the information.

 

[Damocles]

So, what should we do when life expectancy rises for every, despite Darla's insane rants? Get tinfoil? Execute scientists?

Means test. It'll become an old-age welfare program and your contributions will go to somebody who couldn't or didn't save.

 

[Bonestorm]

Why is there talk of "risk" with privatization? Even if investment was straight into the market, we're talking about a period of over 30 years generally.

Talk to people that were planning to retire in 2008 based on their handsome 401k portfolios and get back to me.

If the market is not generating a return for seniors that is MUCH higher than their current 1.5% over that period of time, then we have much, much bigger issues going on economically.

Their current investment gains are so low becuase the government can only invest in special issue Treasury secutiries. If the government were able to invest in other securities, the return would be higher. So if higher returns are what you're looking for, what's the issue with having the governemnt diversify the trust fund portfolio?

 

[Damocles]

How are you going to pay for full benefits that have been promised?

They won't.

 

[Damocles]

Technological development is exponential and always has been. We're about 5-10 years from being able to grow any organ in the body for replacement. With stem cells, gene therapy & other methods, there is a possibility that by mid-century, life expectancies will be fairly incomprehensible to most people now.

It's not sci-fi. If you look at what's going on, it's almost here.

They won't grow them, they'll print them up. I'm hoping for a new kidney, one that won't give me stones every month or so...

 

[Cancel 2020.1]

Talk to people that were planning to retire in 2008 based on their handsome 401k portfolios and get back to me.


Their current investment gains are so low becuase the government can only invest in special issue Treasury secutiries. If the government were able to invest in other securities, the return would be higher. So if higher returns are what you're looking for, what's the issue with having the governemnt diversify the trust fund portfolio?

The market is already back to 14K. And anyone who retired after 30-40 years in 2008 still had HUGE returns.

Sorry.

 

[Cancel 2016.2]

Well Bush put the initial costs of his own partial privatization at 2 trillion. He budgeted over 700 billion into his proposal for the first years.

The 'cost' of $2T is simply wrong. It is shifting the amount owed and paying for it in a different time. The costs of privatizing 100%, privatizing 50% or privatizing 0% are all the same. It is, again, simply a matter of when/how we pay for it. What privatization will do is highlight the unfunded liability we face so that people like you will realize it is not sustainable under the current system.

I don't care about your last paragraph. What I want to know is how much are you planning to take out of SS in order to fund your privatization? Let's say we have a 25 yo. Would you take all of her current SS contribution and put it in private funds, or would you just allow her to invest a portion of her current SS contribution into a private account, ala Bush?

I would not take anything of hers. Privatization would be an OPTION. People could CHOOSE to take a portion and put it into a private account or they could choose to leave it as is.