Social Security:A Bogus Issue

Published on February 14, 2005 By stevendedalus In Politics

This deceptive, sinuous scheme is far too chancy and what’s worse has nothing to do with stabilizing the system that is supposed to be in such dire financial straits. Much has been said about the fact that there are only three workers for every retiree whereas when social security began there were sixteen — forgetting that the payroll tax then was only 1%. That meant supporting the retiree was actually 16% and now three workers back up the retiree with 37½%. The biggest problem to social security is in trying to predict the quality of jobs in the future, and if the current trend is any indication the bang for the buck will be woefully diminished, regardless of the percentage of the payroll tax.

“Tweaking” as Senator Schumer says is what’s needed to meet the requirements of future retirees, such as keeping tabs on longevity and modifying the $90,000 cap. The more pressing issue is, of course, Medicare which is dire straits.

http://stevendedalus.joeuser.com

Comments (Page 1)

drmiler

on Feb 14, 2005

What’s bogus about private accounts tied into social security is that they are not really private, nor are they pure savings but speculation by virtue of the government loaning you, say, 4% of your wages that you would normally pay into the security system. The principal still belongs to the government and must be paid back. If the total return on your account does not exceed what the lien is you have struck out and right back where you started as though you had stuck with the traditional retirement system, but with a very important difference: the cost of the transformation is deducted from your social security. Of course, if you are a shrewd speculator and come up with a bonanza account that exceeds the inflation by a few percentage points, along with the low interest loan the government has charged, you will do all right. However, you will not have the windfall expected as you would had you invested after tax money into your own account. To be sure, IRA and 401k tax deferments helps a great deal in paying back at a projected lower income; yet the government is counting on regaining revenue from a much higher accumulation of retirement income. This, however, is not the same for social security private accounts since payroll tax is unalterable and therefore a lien, not simple deferment is enacted.

This deceptive, sinuous scheme is far too chancy and what’s worse has nothing to do with stabilizing the system that is supposed to be in such dire financial straits. Much has been said about the fact that there are only three workers for every retiree whereas when social security began there were sixteen — forgetting that the payroll tax then was only 1%. That meant supporting the retiree was actually 16% and now three workers back up the retiree with 37½%. The biggest problem to social security is in trying to predict the quality of jobs in the future, and if the current trend is any indication the bang for the buck will be woefully diminished, regardless of the percentage of the payroll tax.

“Tweaking” as Senator Schumer says is what’s needed to meet the requirements of future retirees, such as keeping tabs on longevity and modifying the $90,000 cap. The more pressing issue is, of course, Medicare which is dire straits.

Oh REALLY? And just where did you get this info? Most especially since it's in direct conflict with info from this linked site. Here's the *real* info. Try reading it and comment again.

Link

stevendedalus

on Feb 14, 2005

Personal retirement accounts will not reduce the pool of savings available to the markets because every dollar borrowed by the Federal government to fund the transition is fully offset by an increase in savings represented by the accounts themselves. Yeah, dream on GOP!

bakerstreet

on Feb 14, 2005

And yet this is somehow better than a faux-savings account wherein the money you pay in is inflated and nothing close to what you end up using later, the balance left to be paid by those who will later be in the same shape you are?

Oddly enough Legislators in Washington aren't all that interested in living under the current Social Security program, either. Before adjsutments are made, perhaps they should revert to the current system for their own retirement, and then enjoy a better perspective on the average peron's future under the current system.

drmiler

on Feb 14, 2005

Just what the hell do you want? You say that partially privitizing SS is bad. I show you different and all you can say is dream on? Get real.

stevendedalus

on Feb 14, 2005

Just what the hell do you want?

Intelligent facts not propaganda. Your resources seem restricted to conservative sites.

stevendedalus

on Feb 14, 2005

Oddly enough Legislators in Washington aren't all that interested in living under the current Social Security program, either.

Of course not, social security never intended to secure excessive life styles in retirement. The fat cats sock supplements away so they can live on the golf courses and take trips round the world.

kingbee

on Feb 14, 2005

You say that partially privitizing SS is bad.

think about this for a second. if the trustees are anticipating a couple decades of 1.6% max increase of gdp, how do you expect people are gonna be earning anything like 4% in the market?

David St. Hubbins

on Feb 14, 2005

Here in Canada we dealt with our pension crisis by implementing a big fat tax hike, specifically a payroll tax. We also are running a big fat surplus due to big fat tax hikes, chiefly due to the introduction of a national sales tax. I'm not saying tax hikes are the answer; personally I believe the welfare state is unsustainable and will inevitably collapse - soon. I'm just saying that America isn't the only country dealing with these issues and it would behoove "y'alll" to take a look at how other countries have faced these challenges.

David St. Hubbins

drmiler

on Feb 14, 2005

Just what the hell do you want?
Intelligent facts not propaganda. Your resources seem restricted to conservative sites.

Excuse me? And you think *your* sites are going to know better than the people actually doing it? Look at my link again....it leads to a GOP website.

stevendedalus

on Feb 15, 2005

it would behoove "y'alll" to take a look at how other countries have faced these challenges. .

I have, and very few privatization schemes are working; Britain, facing catastrophe thanks to Thatcher's privatization scam, is now taking a second look at our social security as a favorable model for repairing their own

the welfare state is unsustainable and will inevitably collapse - soon.

If it collapses so will society as we know it will also collapse because uncontrollable poverty will lead to crime, violence, disease and total alienation.

stevendedalus

on Feb 15, 2005

<P>I'm well aware of the GOP site as I indicated I've been there at your request. The trustees are given strict orders to favor the president's bias.</P>

drmiler

on Feb 15, 2005

I'm well aware of the GOP site as I indicated I've been there at your request. The trustees are given strict orders to favor the president's bias.

So I guess then *only your* sites can be considered unbiased?

stevendedalus

on Feb 15, 2005

You miss the drift: privatizing is a bad idea because it is extraneous to the solvency problem.

drmiler

on Feb 15, 2005

You miss the drift: privatizing is a bad idea because it is extraneous to the solvency problem.

And just how is it a bad idea? Especially since 1 it's NOT mandatory! And you will only be allowed to put up to 4% of your SS witholding in the account. Just because it's extraneous to the solvency problem doesn't mean it's bad. And just an FYI Bush does NOT call this a fix for that afore mentioned problem.

Dr Guy

on Feb 15, 2005

You miss the drift: privatizing is a bad idea because it is extraneous to the solvency problem.

No, itis core to. The real issue is that the liberals do not want us to make decisions for ourselves, and the conservatives do. Period. That is the issue, and you can fluff it any way you want, but your position is for more nannyism.

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