Tell me: Am I frickin' Dreaming?

[DigitalDave]

Productivity.

When ss started out, therer where what, 80 workers per retiree?

Now, there's what, three per retiree?

Do you think contributions went up exponentially, almost three orders of magnitude? I don't think so. More producitivty means more income, overall

Productivity is part of the equation, I agree. But how much more productive do you think we can get as a society. We are already pretty much at lightning speeds, only way to become more productive is to automate everything and not have to have the human factor, which means less jobs, and less people paying into SS.

 

[Litmus]

Yep, the key is productivity. Not the ratio of workers to retirees.

SS want from a worker/retiree ratio of 18-1 in 1950, to 4-1 in 1965 without collapsing. Because of gains in productivity

That's the key only because we hosed it on the other factor. What your saying is what Im saying, the enslavement of workers. You call it, maximum productivity, Slave drivers always do. I'd prefer the system be dismantled and that old people be asked to recognize that they fell for lies, and that enslaving their progeny is a shitty thing to do.

 

[AnglScarlett]

That's the key only because we hosed it on the other factor. What your saying is what Im saying, the enslavement of workers. You call it, maximum productivity, Slave drivers always do. I'd prefer the system be dismantled and that old people be asked to recognize that they fell for lies, and that enslaving their progeny is a shitty thing to do.

For a bunch of slaves, you people seem to post here during working hours a lot, is the overseer asleep? I am for Social Security, I am a moderate righty, and truthfully, if it were not for the gun issue, and the moolahs, I would be a democrat? Butt, I do not feel save entrusting the libs with our national security, especially The Hillary, who, had the blue dress pulled over her eyes by two chubsters, how hard will it be for Usama to fool her?

 

[Jarod]

When there are 16 people paying for your retirement, they only have to pay 1/16th of your check. Say you get a $1000 check, they only have to pay $62. When you have 3 people paying, then they have to pay $333. When it's 2 people, its $500. Seriously, how will we be able to support SS without creating an expanding base?

You are misunderstanding the meaning of expanding. A pyramid scheem requires a constantly expanding base... meaning that the base must expand every year to make the same result as last year. If people never died and thus came off the SS rolls then SS would be a Pyramid scheem... People die and come off the rolls and thus while SS MAY require a 2 to 1 or a 16 to 1 rato it does not require a 2 to 1, then a 4 to 1 and so on and so on.. its not a pyramid scheem.

 

[Litmus]

For a bunch of slaves, you people seem to post here during working hours a lot, is the overseer asleep? I am for Social Security, I am a moderate righty, and truthfully, if it were not for the gun issue, and the moolahs, I would be a democrat? Butt, I do not feel save entrusting the libs with our national security, especially The Hillary, who, had the blue dress pulled over her eyes by two chubsters, how hard will it be for Usama to fool her?

Don't you have some scabs to eat or something?

 

[Jarod]

If you require a 10 to 1, and the top is getting larger than the bottom, the pyramid begins to fall, that is the point where we are right now.

As originally designed the SS system was not a pyramid scheme. Currently it is. Since the money is not put into any savings and the payout comes from those at the bottom it must expand in order to continue at the same level or the bottom must pay more, or the top must be forced to be smaller, i.e. Raise the age of 'retirement'.

The "little fixes" are the same as the top of a pyramid 'adjusting' it to make it last longer when the failure has become apparent.

Your point is correct except that its not a Pyramid Scheem as someone above refered to it. It does not require a CONSTANTLY EXPANDING BASE. It has problems, but its not a PYRAMID SCHEEM.

 

[Litmus]

You are misunderstanding the meaning of expanding. A pyramid scheem requires a constantly expanding base... meaning that the base must expand every year to make the same result as last year. If people never died and thus came off the SS rolls then SS would be a Pyramid scheem... People die and come off the rolls and thus while SS MAY require a 2 to 1 or a 16 to 1 rato it does not require a 2 to 1, then a 4 to 1 and so on and so on.. its not a pyramid scheem.

No. It's a pyramid scheme even with people dying. new people replace them at the top of the pyramid, and since, as you admit the base has to expand to get the same result, there are more people coming to replace the ones that died and thus the cone becomes larger, and a larger cone requires and even larger base, and on and on.

 

[Litmus]

Your point is correct except that its not a Pyramid Scheem as someone above refered to it. It does not require a CONSTANTLY EXPANDING BASE. It has problems, but its not a PYRAMID SCHEEM.

It is a pyramid scheme. There are other ways to keep it solvent, like enslavement and whip use, but that doesn't mean it's not essentially a pyramid scheme.

 

[DigitalDave]

You are misunderstanding the meaning of expanding. A pyramid scheem requires a constantly expanding base... meaning that the base must expand every year to make the same result as last year. If people never died and thus came off the SS rolls then SS would be a Pyramid scheem... People die and come off the rolls and thus while SS MAY require a 2 to 1 or a 16 to 1 rato it does not require a 2 to 1, then a 4 to 1 and so on and so on.. its not a pyramid scheem.

I think you don't understand that we needed to stay at a larger ratio, which would have meant that the total numbers have to expand. Not just the ratio but the total number of people working must increase in order to support the total number on SS. Since we need more people, we will need more people to support SS when they retire, and so on and so forth. It expands. If we maintained a constant 2 to 1 ratio, which would mean we dont really need more than one child per adult, and SS could be maintained, then we'd be fine and it would be a pyramid. But it's not the case. We need more than a 2 to 1 ratio and must have more than just one child per person to pay for SS. It's got to expand.

Edit: 'Wouldn't be a pyramid'

 

[Litmus]

Social Security and Math
Of Pyramids and Pyramid Schemes
http://www.fonerbooks.com/social_security.htm
From the dawn of civilization, we human beings have been burying our dead, but it's only in the last century that we've begun entombing our living as well. The ancient Egyptian Pharos invested their excess wealth in building pyramids and other monumental tombs in which their mummies were placed after they died. We fill our hospitals and nursing homes with living mummies (and daddies), sometimes over the objections of all of the family members involved. The wealth we spend postponing the clinical death of our elderly by a few days or weeks dwarfs the amounts the Pharos spent on immortality.

So the Egyptians had their pyramids, and we have our pyramid schemes known as Social Security and Medicare. Unlike the Egyptian pyramids that have stood for thousands of years, our pyramids (as we know them) will collapse in the near future. Are there easy solutions to the Social Security and Medicare shortfalls? Sure, raise the retirement age and lower the benefits for both programs. It's going to happen eventually, but the the AARP will fight it until the programs are so far into the red that the it will be a miracle if the replacement programs allow senior citizens (like myself in 30 years) enough to rent a room and buy cat food for a thin fiction of a cat.

Despite the central role Social Security plays in the American social contract, most people, entrepreneurs included, remain woefully ignorant of how the program works, who it covers, and why if they're young and have a brain in their heads they'll support reforming the system. One common myth I've encountered amongst self-employed colleagues is that your ultimate Social Security benefit is calculated based on your best three or five years of employment. I even know one aging entrepreneur who plans to pay himself at an artificially accelerated rate during his last three years (reverse-laundering money from his savings) because he's convinced he'll get it back times ten through higher benefits. He won't.

Our eventual social security benefits are based on our average monthly earnings over the best 35 years of our working lives. This is used to compute how much we would receive at full retirement age, currently 65. Workers can choose to start collecting retirement benefits at an earlier age, 62 in the current implementation, but it doesn't make much sense unless you are part of a high risk group, like single, unmarried men (statistically slices six years of your life). If a currently retiring person continues to work after retirement age, the benefit increases until age 70, after which it's a wash.

There's a worksheet for figuring your actual benefit on the Social Security site at http://www.ssa.gov/pubs/10070.html- Just don't count on collecting it

Somebody famous once said, "Big government grows biggly." Alright, maybe it was me, but the principle is a sound one. The Social Security system was initially proposed as the centerpiece system for ensuring Americans a regular check in retirement. It was never a savings scheme, it's actually an insurance program where the premiums paid by current workers pay the benefits of retired workers. Thanks to people living longer, the program would have gone broke sooner or later in any case, but it's been hastened along by an expansion of benefits beyond retirees. You can argue whichever side you like as to whether or not some of the non-retirees receiving benefits should be getting supported by direct government expenditure, but including people who have never worked in a retirement system was a bit of a stretch.

In the year 2001, the government paid out a little over 1.1 trillion dollars in direct benefits to individuals. That comes to around $4,000 per citizen, but of course, most of us aren't getting any of the money. A little under half the amount ($450 billion) went to retirement and varied disability payments, and a slightly greater amount ($476 billion) went to direct medical payments. Income maintenance benefits (a combination of Supplemental Social Security, Family Assistance, Food Stamps and grab bag of other needy programs) accounted for $111 billion and unemployment benefits came in at a mere $32 billion. Veterans benefits were second to last on the big ticket list at $26.5 billion and Federal Education and Training came last at $13 billion. All other little pork barrel boondoggles together came to just $3 billion. 2001 was in fact a milestone year, the first time medical benefits outstripped retirement and disability.

Some Americans are saving for retirement outside the Social Security system, though fewer than you might think. A little less than half of American households have an IRA of any type, in 2002, around 33 million had a traditional IRA, 12 million had Roth IRA's and under 8 million had the self-employed styles, (SEP, SAR-SEP or Simple). There are over 300,000 401K plans out there, but they probably represent less than 40 million participants (not counting single participant plans).

To give a broad sweep of the benefits for the really needy, about 5% of American households received food stamps in 2000, down from a high of around 8% just a few years before. About 4.5% of households lived in public housing, up from 3.4% two decades earlier. 13.5% of American received Medicaid assistance in 2000. Over 18 million Americans are considered "work disabled" by the U.S. Census Bureau, with 3.5 million of those under age 34. Just under a third of work disabled Americans get Social Security benefits, two thirds are covered by Medicare, one in six receives Food Stamps and one in ten reside in public or subsidized housing.

On the bright side, over 88% of American households surveyed in the year 2000 contributed to charity. The leading recipient was religious institutions, garnishing contributions from over 60% of giving households. Health oriented charities were next (they have excellent fundraisers) at 38% of giving households, followed by Human Services, Youth Development and Education. We won't give the whole list here, but Adult Recreation came in last, I didn't even know it was a charity.

 

[Damocles]

Your point is correct except that its not a Pyramid Scheem as someone above refered to it. It does not require a CONSTANTLY EXPANDING BASE. It has problems, but its not a PYRAMID SCHEEM.

It is a failing pyramid scheme. As the bottom begins to get smaller, the burden for payout becomes too high and the pyramid collapses. When DD retires and it is 2 to 1 do you think we might not be at that point? Of course we will.

 

[Litmus]

A pyramid scheme we can afford to lose
By Laura Vanderkam
http://www.usatoday.com/news/opinion/2005-03-09-younger-benefits_x.htm
Everyone's talking about saving Social Security. In the days of budget surpluses, President Clinton said we should "save Social Security first." Now President Bush is touting personal accounts as a way to fix the looming cash crunch.
Democrats say there's no crisis — we need to save Social Security from Bush. All this talk of "saving" is sounding more like the Old Fashioned Revival Hour than a policy debate. What I haven't heard asked is why we're saving Social Security in the first place.

Most young people don't expect its salvation. A recent Washington Post/ABC poll found 80% of 18- to 30-year-olds don't expect that Social Security will be able to pay our benefits in years hence. That sounds like pessimism, but it's actually an opportunity.

Given low birth rates and rising life expectancies, in time, Social Security won't be able to sustain our elderly population without punitively taxing workers.

Bush's proposed personal accounts are a start to addressing this flaw. Trouble is, he wants them for the wrong reason. "We must make Social Security permanently sound," he says. But the only permanently sound solution to the problem is to get the government out of the retirement business. Young people will fund the transition — paying off retirees without getting benefits — if politicians will, please, then let us alone.

Thanks, but no thanks

Tales of Social Security's popularity are overblown.

Sure it's popular — among well-heeled geezers who have time to write their congressmen. I can see why.

What other program, meant to guard against the "hazards and vicissitudes of life" (to quote Franklin Delano Roosevelt) including a "poverty-ridden old age," produces tales like this recent USA TODAY gem?

"Bill Mossman, 78, stopped working at 62. He's had a joyous retirement — traveling, studying, working out three times a week and assembling a giant collection of historic jazz recordings. Social Security's early retirement age made it all possible. 'I took Social Security benefits right away. We wanted to travel and needed the cash flow,' says Mossman."

Hazards? Vicissitudes? Historic jazz recordings?

For Gen X, though, this program sounds awful. No matter how poor you are, you pay 12.4% of your income, every year, to maintain Mossman's cash flow.

Sure, Mossman paid in, funding other retirees. Their taxes funded original recipients who didn't pay a dime. This is the classic definition of a pyramid scheme, which eventually has too many folks to pay off with too few suckers paying in. Thanks to the 1946-64 baby boom, Gen X is firmly in the "too few suckers" bin.

So, sometime in my lifetime, Social Security will explode in the form of tax hikes or borrowing, all because of an attempt to alleviate elderly poverty in a way that makes no sense. It is true that one-third of Social Security recipients rely on it for 90% of their income. But we can aid the elderly poor who can't work or rely on family without propping up a pyramid scheme that pays off wealthy retirees to buy support for the system.

FDR's choice to make Social Security a pyramid scheme instead of a poverty program has given us a ticking bomb. The most sensible plan is to take the bomb apart while we have time.

A shared sacrifice

Defusing a bomb is never easy, and it will require shared sacrifice. We can lower future liabilities by trimming payments for the jazz-record-collecting set. The retirement age can rise several more years. Those over 50 can have their payroll taxes, and benefits, reduced. They'll have some time to save. Those over 35 can have their taxes phased out during the next decade, with an understanding that benefits will be even more limited.

But the real key to defusing a pyramid scheme is finding folks willing to pay in, for a while, expecting nothing in return. Here's where twentysomethings' fatalism becomes a blessing. I bet we'd pay in 12.4% for 10 more years to fund the system, even knowing we'd never see a penny. That sounds harsh, but if 80% of us don't expect benefits anyway, it's realistic — and feasible. Few of us vote, after all. And a 12.4% tax cut during our highest-earning years would soften the blow. Provided politicians use our cash to cover Social Security liabilities and not mask spending, this should help cover the gap.

Without guaranteed benefits, we'd have to save for our own retirements. It's not a habit we're in now, but habits can change. For twentysomethings, more cash and a smaller safety net are two incentives to save.

Future generations should learn financial literacy in school. If kids can learn to add, they can learn about mutual funds, risks, diversifying and rates of return. They can learn that building up credit card debt is as naughty as hogging toys.

Of course, trusting people to make their own retirement decisions is not a habit politicians are in either, so I don't see the "End Social Security Act" being introduced soon. That's why Bush's personal savings accounts are a start. But we should keep in mind that if 4% of income devoted to wealth building is good, 12% is better.

Even a few thousand dollars invested annually can make you a millionaire in 40 years. That kind of wealth is an insurance against hazards and vicissitudes that Social Security can't pretend to supply.

 

[Litmus]

cypress owned -- check
darla owned -- check
jarod owned -- check

 

[Cancel 2016.2]

Al Gore was the one the Republicans made fun of for sugesting the Lock Box idea, basically he wanted to make it so that the money going into SS could not be raided for other projects. The money would be placed in a Lock Box, then held and used only for funding SS.

If you have 10 people paying for SS, and 10 people recieving benefits, the base remains the same and the program remains solvent. If those numbers remain stable then SS does not require an expanding base and thus is not a pyrmid scheem. Get it, first graders?

Listen.... it IS most certainly a pyramid scheme... you have the collapse occur when one level is NOT supported by the one below it. THAT is what happens when the boomers retire. There will be more of them retiring than there will be new workers entering the workforce. So it will fail. It has nothing to do with an "expanding" base. It has to do with one level being supported by those below it.

Get it...?

 

[Cancel 2016.2]

A pyramid scheme we can afford to lose
By Laura Vanderkam
http://www.usatoday.com/news/opinion/2005-03-09-younger-benefits_x.htm
Everyone's talking about saving Social Security. In the days of budget surpluses, President Clinton said we should "save Social Security first." Now President Bush is touting personal accounts as a way to fix the looming cash crunch.
Democrats say there's no crisis — we need to save Social Security from Bush. All this talk of "saving" is sounding more like the Old Fashioned Revival Hour than a policy debate. What I haven't heard asked is why we're saving Social Security in the first place.

Most young people don't expect its salvation. A recent Washington Post/ABC poll found 80% of 18- to 30-year-olds don't expect that Social Security will be able to pay our benefits in years hence. That sounds like pessimism, but it's actually an opportunity.

Given low birth rates and rising life expectancies, in time, Social Security won't be able to sustain our elderly population without punitively taxing workers.

Bush's proposed personal accounts are a start to addressing this flaw. Trouble is, he wants them for the wrong reason. "We must make Social Security permanently sound," he says. But the only permanently sound solution to the problem is to get the government out of the retirement business. Young people will fund the transition — paying off retirees without getting benefits — if politicians will, please, then let us alone.

Thanks, but no thanks

Tales of Social Security's popularity are overblown.

Sure it's popular — among well-heeled geezers who have time to write their congressmen. I can see why.

What other program, meant to guard against the "hazards and vicissitudes of life" (to quote Franklin Delano Roosevelt) including a "poverty-ridden old age," produces tales like this recent USA TODAY gem?

"Bill Mossman, 78, stopped working at 62. He's had a joyous retirement — traveling, studying, working out three times a week and assembling a giant collection of historic jazz recordings. Social Security's early retirement age made it all possible. 'I took Social Security benefits right away. We wanted to travel and needed the cash flow,' says Mossman."

Hazards? Vicissitudes? Historic jazz recordings?

For Gen X, though, this program sounds awful. No matter how poor you are, you pay 12.4% of your income, every year, to maintain Mossman's cash flow.

Sure, Mossman paid in, funding other retirees. Their taxes funded original recipients who didn't pay a dime. This is the classic definition of a pyramid scheme, which eventually has too many folks to pay off with too few suckers paying in. Thanks to the 1946-64 baby boom, Gen X is firmly in the "too few suckers" bin.

So, sometime in my lifetime, Social Security will explode in the form of tax hikes or borrowing, all because of an attempt to alleviate elderly poverty in a way that makes no sense. It is true that one-third of Social Security recipients rely on it for 90% of their income. But we can aid the elderly poor who can't work or rely on family without propping up a pyramid scheme that pays off wealthy retirees to buy support for the system.

FDR's choice to make Social Security a pyramid scheme instead of a poverty program has given us a ticking bomb. The most sensible plan is to take the bomb apart while we have time.

A shared sacrifice

Defusing a bomb is never easy, and it will require shared sacrifice. We can lower future liabilities by trimming payments for the jazz-record-collecting set. The retirement age can rise several more years. Those over 50 can have their payroll taxes, and benefits, reduced. They'll have some time to save. Those over 35 can have their taxes phased out during the next decade, with an understanding that benefits will be even more limited.

But the real key to defusing a pyramid scheme is finding folks willing to pay in, for a while, expecting nothing in return. Here's where twentysomethings' fatalism becomes a blessing. I bet we'd pay in 12.4% for 10 more years to fund the system, even knowing we'd never see a penny. That sounds harsh, but if 80% of us don't expect benefits anyway, it's realistic — and feasible. Few of us vote, after all. And a 12.4% tax cut during our highest-earning years would soften the blow. Provided politicians use our cash to cover Social Security liabilities and not mask spending, this should help cover the gap.

Without guaranteed benefits, we'd have to save for our own retirements. It's not a habit we're in now, but habits can change. For twentysomethings, more cash and a smaller safety net are two incentives to save.

Future generations should learn financial literacy in school. If kids can learn to add, they can learn about mutual funds, risks, diversifying and rates of return. They can learn that building up credit card debt is as naughty as hogging toys.

Of course, trusting people to make their own retirement decisions is not a habit politicians are in either, so I don't see the "End Social Security Act" being introduced soon. That's why Bush's personal savings accounts are a start. But we should keep in mind that if 4% of income devoted to wealth building is good, 12% is better.

Even a few thousand dollars invested annually can make you a millionaire in 40 years. That kind of wealth is an insurance against hazards and vicissitudes that Social Security can't pretend to supply.

Well done.

 

[Cancel 2016.2]

Your point is correct except that its not a Pyramid Scheem as someone above refered to it. It does not require a CONSTANTLY EXPANDING BASE. It has problems, but its not a PYRAMID SCHEEM.

actually you are incorrect. The reason the base must expand continuously is due to the fact that life expectancy is increasing. If we continue to live 20-30 years in retirement rather than the original 2-3 years on average, then the base must continue to expand to cover the increasing costs of retirement.

If you look at the requirements of funds in and out... when SS started it was a small amount going out and started to increase exponentially as the number of retirees expanded and life expectancy increased. Thus, the amounts being paid in had to continue to increase. The base of the pyramid began to shrink... the pyramid began falling apart.... it will collapse due to the boomers retiring.

 

[uscitizen]

The age to get SS benefits will rise as the life expectancy does.
If congress does it's job that is.

 

[Cancel 2016.2]

The age to get SS benefits will rise as the life expectancy does.
If congress does it's job that is.

It began at 65 when it was first created. Currently depending on your age it is 67 for my generation and 70 for some younger.

Life expectancy was 67 when it was first created.... now life expectancy is 88-90 for those that are due to receive SS starting at 70.

Depending on politicians to do the right thing? Somebody been smokin the ganja

 

[uscitizen]

Good point on the ganja SF. Might need to round some up it would appear.

 

[BRUTALITOPS]

Grind, why do you follow me around, and chirp out from the peanut gallery? Go pay mainman his bet, and stop following me around, with stupid little comments.

im not following you around anymore than anyone else is. this is a public forum to address comments. I addressed yours. I'll wait for you to point out all the incredible support for huckabee on this site and fullpolitics.com