Posted on 04/02/2009 11:37:00 AM PDT by Selkirk
Don't ask why I do it. I guess I'm just a glutton for punishment. I love to patrol the liberal blogs to get a glimpse at their thought process, or lack of which. I drop a comment from time to time, which normally kicks off a flurry of name calling, hair pulling, and all sorts of other forms of serious debate.
Today's waste of time was spent on FireDogLake, where they seem to have a problem with Paul Ryan's comments regarding the future of Social Security. Keep in mind one thing: liberals love them some social security.
(Excerpt) Read more at blog.politicalcastaway.com ...
They want Social Security allright. But the Statists want to steal from older folks, so they will do what they have to to advance the neglect of the elderly. Social Security? Let’s start to rename it what it will become:
Marxist Security.
It’s amazing to me how the AARP has members. Really.
Many people become big cry babies as they age, I’ve watched it happen to friends, hope I can avoid it. I don’t expect much, other than to be left alone, and not taxed out of my home. AARP has become a wing of the socialist party, they don’t even try to hide it.
My husband joined AARP one day, so he could get a 10% discount on some big item. I let him know how I felt about AARP, and tear up any mail they send his way. hahah.
Ping list for the discussion of the politics and social (and sometimes nostalgic) aspects that directly effects Generation Reagan / Generation-X (Those born from 1965-1981) including all the spending previous generations are doing that Gen-X and Y will end up paying for.
Freep mail me to be added or dropped. See my home page for details and previous articles.
lol!
When you take money from the citizens’ paychecks and tell them it will be repaid it has to be. Otherwise the government is in default of an agreement that it made with its citizens and deserves to be removed.
I agree that it is a Ponzi scheme but the taxpayers who had their earnings confiscated have every right to ask for their money back.
Oh no they don’t.
There was a Supreme Court case a few years back in which it was determined that the government is NOT legally liable for the money it promised us.
Unfortunately, I agree, to an extent of course...
I break it down into four groups. Those that need SS due to real (provable, verifiable, tested regularly,)disability. My opinion is that this is what SS should be.
Second, those who are currently retired and relying on SS. Simple fact is, someone promised them someone elses money and they depended on that promise. Shame on both of them, but not much that can really be done here absent starving the elderly - and that's something I will voluntarily pay to avoid absent any promised return to me.
Third, those who are heading into retirement but didn't plan for their own future. This may include people who believed that the promised gravy train would be there for them, those who want to retire at 65 but kept pumping moeny into high risk investments even though they were about to retire and should have protected their assets, and those who levereaged their house for toys instead of getting out of debt so they could enjoy their retirement. Obviously there will be some responisble people who got caught in the crossfire, but unfortunately this group is going to have to face reality in the near future.
Their benifits need to be reduced. This may include proportioned reduction in benefits depending on age, significantly increased retirement age, etc. Absent that this program will bankrupt our nation. Maybe not popular but true.
Fourth, the group that is yet to come. We don't expect SS to be there when we retire because we understand a Ponzi scheme when we see one. Yet, we want to help the most in need. We are also willing to fork over our cash to help smoothly transition out of this mess even though we won't get a dime in return. Our priority is making sure our kids aren't bankrupted by our fathers and forefathers mistakes.
Then again, if we can't get a compromise on this issue - many of us are willing to zap the whole freaking program as soon as we are in charge and let all of the proceeding groups rely on private charity so that are kids aren't bound into indentured servitude.
That's just my opion however...
You said: “Second, those who are currently retired and relying on SS. Simple fact is, someone promised them someone elses money and they depended on that promise.”
How is it someone else’s money? Last time I checked, I have been paying social security tax since I started work. If I live to the age where I am able to collect social security, are you saying that the money I paid in doesn’t count for anything?
People who collect social security now, have paid in since the program was started. If that money would have been left in their checks, then yeah, they are on someone else’s dime. But they have paid.
First, the money you put in, likely has already been used to pay for something else or even on the brightest side, paid for someone elses SS benefits. That means, to get "your" money back - someone elses cash will need to be given to you. Just like a ponzi scheme.
Second, half of the money put into SS comes from your employer. That means they had to increase their prices to cover part of the ponzi scheme which in turn is taking money from other people. Again that money has likely has already been used to pay for something else or even on the brightest side, paid for someone elses SS benefits.
Third, the rate of investment return on whole within the SS program is less than inflation. That means, to even make a minor attempt to keep benefits in check with regard to inflation, it will be necessary to take more money from other people to pay out the benefits.
Absent draconian cuts in benefits, massive increases in required contributions, or jacking the retirement age up to a much higher level, the system is insolvent. That means for you to get your money back from the system you will have to be paid by someone elses money.
I'm not trying to say it's your fault, it's just the way it is.
Last time I checked, I have been paying social security tax since I started work.
You are certainly not alone. So has every legal employee and their employer.
If I live to the age where I am able to collect social security, are you saying that the money I paid in doesn’t count for anything?
It counts for something. You and I and our employers paid for the benefits of people who retired before us. Problem is, the ponzi scheme is unraveling and when the music stop there certainly aren't going to be enough chairs for everyone to sit in to get their benefits.
I would prefer to ease out of the system over the next 20 - 30 years. If for no other reason than to avoid hanging a multi-trillion dollar debt around my children's neck.
People who collect social security now, have paid in since the program was started. If that money would have been left in their checks, then yeah, they are on someone else’s dime. But they have paid.
They paid, no disagreement there. There just isn't enough cash to keep up the current scheme. Absent draconian cuts in benefits, massive increases in required contributions, or jacking the retirement age up to a much higher level, the system is or soon will be insolvent.
Also, and this isn't meant to be argumentative, but those who are collecting now - they didn't hold their elected representatives accountable for mismanaging their money. The system was likely doomed to failure from the start, but ignoring that, most investors would not stand for letting their investment fund managers liquidate their assets and put a big IOU in their account. But, they let Congress do it over and over again.
Someone has to pay off the IOUs. Just the way it is.
We could debate the reasons for that, but it is a fact. Blame Congress for raiding that money, probably true. Blame Congress for not adjusting the retirement age up fast enough (SS originally began at the typical life expectance age). Blame society for thinking they deserved to be able to collect 20 years of benefits, adjusted for inflation. Blame special interest groups which villified any attempts to deal with social security management earlier when it would have been much easier.
Blame whoever you want, doesn't change the facts. The system is or soon will be insolvent. Waiting to deal with it won't make it any easier.
The current pains of GM are at least a decent metaphore of where the US is heading if we don't do things to address this problem very soon.
Just like in that situation, some will get screwed over, you me, lots of others. Just a fact.
Personally, I would prefer to deal with it now in order to attempt to make the screwing over as orderly and effective as possible.
Take care.
That very likely is the case but doesn't change the fact that I have 'contributed' over $150,000 during my work years. And that figure is from SS statements.
Second, half of the money put into SS comes from your employer.
That money is/was really mine. The employer simply withheld it and sent it to SS just as they withhold income tax.
I have objected to the Social Security system from my first working days,circa 1961 but it was compulsory and I expect the government to uphold their part of the bargain.
I would much rather have invested that money privately.
I wouldn't even attempt to disagree with your numbers. I do agree that your inference that "contributed" is a bit of an overstatement. In my book to contribute means you chose to do so willingly. I don't think you or I had the opportunity not to "contribute."
I am also and have been paying in. Doesn't change the fact that the system is or soon will be insolvent and something needs to be done to fix it.
That money is/was really mine. The employer simply withheld it and sent it to SS just as they withhold income tax.
Again, I am not disagreeing. If they didn't have to "contribute" they could have done two things - paid you more for you to be in charge of your own money or lowered the cost of their goods and services. Their portion of the "contribution" came from someone's, hide likely a combination of yours and their customers.
Regardless the money put into the system is or soon will be gone. You have a big fat IOU in it's place. You expect someone to pay back that IOU. I don't blame you. But doesn't change the fact that the money isn't there.
Congress spent it, the system wasn't designed to pay you back at even basic inflationary rates, and nobody has held them accountable.
I have objected to the Social Security system from my first working days,circa 1961 but it was compulsory and I expect the government to uphold their part of the bargain.
What part? Retirement at 65? Benefits of $### per month?
Their "bargain" was give us your money and we'll give you money back later. They can through the standard legislative process change the age at which benifits begin, the amount of benefits paid out, or the amount of "contributions" required to be paid in.
There is no guarentee that you will get your money back either. Die early - too bad - thanks for your cash.
While I understand that you want your $150,000 paid out in benefits, should my children have to pay it because someone else made a promise they couldn't keep? You expect the "government" to uphold their part of the bargain, but that is nothing more than saying you expect tomorrows generation to pay off someone elses debt. Debt that was created via empty promises to suckers who trusted Congress with their money and never held them accountable for keeping it safe.
I'm not trying to argue with you, just point out that the ponzi scheme won't work. Someone is going to have to foot the bill.
I also think that beginning to foot that bill now - across the spectrum - is important to do.
Establish a tiered system, nothing changes for those currently retired and recieving SS benefits. While there is a great deal of experience and knowledge to be gained from this group of people, it will be next to impossible to ask them to agree to a system which requires they return to the workforce.
Increase the age to recieve benefites for those greater than 5 years from retirement slightly and reduce benefits slightly. This group made plans on the system (good or bad) and they have little time to do something else to create their own retirement. To fix the system they need to be asked to stay in the work force longer (reduce total benefit output to them) and recieve slightly less benefits for the rest of their lives (equalled out by a few more years earnings and associated savings in the work force).
Moderately increase the retirement age for those greater than 5 but less than 15 years from retirement. Also, moderately decrease the benefits to be provided. Same reasoning as above - they have more time to plan for and make happen their retirement.
Substantially increase the retirement age for those greater than 15 but less than 30 years from retirement. Also, substanially decrease the benefits to be provided. Same reasoning as above - they have significantly more time to plan for and make happen their retirement.
Eliminate SS benefits for anyone greater than 30 years from retirement. They have time to plan and make happen their retirement.
Transform SS into a system which thirty years from now only serves those physically incapable of perform work and the dependents of those people who need assitance just to survive through age 18. A safety net, not a retirement ponzi scheme.
Maintain contributions from all (even those that will have reduced benefits) until such time as the contributions can be reduced while maintaining a solvent balance sheet for the system.
This means that people close to retirement need to give up a little, those further away need to give up more but have some time to adjust. Those even further away need to give up substantially more, but have even more time to adjust. And those more than 30 years from retirement give pretty much everything up but get to pay off the debt (and get nothing in return).
In case you were wondering, I am 37 years from SS benefits. I am one of the people who would get nothing in return for paying off someone elses promise that a bunch of suckers bought off on. Fine, my parents and granparents passed this debt to me, I'll do my part to settle the debt.
Treated like a 30 year mortgage that needs to get paid down it is doable. Not fun, won't benefit me one bit, but is doable and would make our nation better off.
The other option is to keep paying interest only on a 7 year balloon loan and act surprised when the note comes due.
I'm not at all comfortable with that and neither should anyone be who believes our children or grandchildren shouldn't have to pay for our mistakes.
I would much rather have invested that money privately.
You and me both my friend. Unfortunately we weren't given that option. We were given a broken system that made promises it couldn't keep, was supported by suckers along the way, and held a fistfull of dollars in front of Congress with little or no oversight being made by the American people.
Plenty of blame to go around, but fixing the damn problem is what is necessary. You might need to take $125,000 for your $150,000 investment into the system, and I might need to pump $300,000 in over my life and get jack shit in return.
I'm ready to do so if it results in a long term solution - are you?
Take care.
All you say is true. However, I don’t see a clean way out of the hole that was dug. My biggest problem with the proposed privatization of Social Security was that the money would continue to be taken, and then put into an account, and then “managed” by someone in the stock market.
In my opinion, the popularity of the 401K in the mid 90’s and the increasing popularity of the 401K to the present day, is a contributing factor to the stock market inflation (bull market) seen in recent years.
Throwing mandatory deductions from all working people into this type of account and thus into the stock market will only result in more fraud, and inaccurate stock prices.
We pay for our mobile society, and the fracturing of the family through social security, I guess.
Thanks for your well thought out reply.
All you say is true. However, I don’t see a clean way out of the hole that was dug. My biggest problem with the proposed privatization of Social Security was that the money would continue to be taken, and then put into an account, and then “managed” by someone in the stock market.
I totally agree - there is no clean way out of this hole. Someone, or a lot of someones are going to get screwed over. I think the question is - when do we decide to divvy up the screwing over and get it done in an effective way?
I think there is an opportunity with at least some of the people in my age group. We are planning for a non-SS subsidized program because at least some of us believe it will collapse well before we will ever draw benefits. That said my experience is that we are already resigned to the fact that we are paying into a system from which we will draw no benefits.
On one hand I suppose some will say that is a sign of sheeple, etc., etc., etc. A wise person - with an eye on making a better future for this nation might see it as an opportunity. Is there a large group of people at the middle beginning of their earning carreers who are actually resigned (committed) to paying into a system that is broken? Could they be encouraged to help end the broken program - not for material gain - but to just be the engine that resolves the problem and move on?
Not sure it would ever fly. For me - I'd sign up, but that is me and not everyone. It would be nice if politicians, or at least society asked the questions in a real way.
Otherwise that hole gets deeper and dirtier...
In my opinion, the popularity of the 401K in the mid 90’s and the increasing popularity of the 401K to the present day, is a contributing factor to the stock market inflation (bull market) seen in recent years.
I would agree to, some extent. Certainly more money chasing fewer goods and services results in increased prices. In this case not from a monetary inflation standpoint but more from a stock value standpoint.
You may very well be right, but I have a different thought as to why the stock market went so high, and came down so hard.
By in large the folks with the most spare income were those closer to retirement than at least I am. Don't want to play blame games or generalize, but will call it the soon to retire baby boomers. One size doesn't fit all etc...
I think (and have no data to back up) that many, many soon to retire baby boomers had the vast majority of their 401K's in primarly stocks. In other words high risk high reward portfolios. Couple that with temporary wealth from home appreciation - life is good.
Problem is, stocks dropped a bit, and it is tough to make up that cash with fewer years until retirement. They might have been sheltered a bit from the hit had the traded the reward part of the risk reward equation for less risk, but I don't think they did.
Once their soon to be retiring retirement fund lost 10%, many of them had enough and yanked it and put it somewhere more safe - probably where they should have had more of their $ at the time anyway.
That caused another round of selling and associated price drops, which ran out the next layer of soon to be retired investors, and the next, and so forth...
And so the cash in in the markets has left. Some will come back, some will stay on the sidelines in safe low risk investments where it should have been anyway.
On the bright side I am dollar cost averaging at DOW 8000 instead of 13000 with 35 years to go before I hit 72...
I think the bull market run (too much of one) could have been tempered by some realistic risk assessments without over inflating the markets.
Probably a rant there, but felt good and is just my opinion...
Throwing mandatory deductions from all working people into this type of account and thus into the stock market will only result in more fraud, and inaccurate stock prices.
Not sure about your situation but I am not forced to put any of my money into 401K. Social security, well, that's another issue that I apparently don't have an option on. But as for 401K nothing is making me put 6% of my income in other than the fact that I want the 3% match from my gracious employer (honestly - really like my company's retirement benefits - the 401K is just one aspect).
We pay for our mobile society, and the fracturing of the family through social security, I guess. That we do I'm sure. And greed in place of common sense hurts, as does the dole - probably more importantly as you note - with regard to reducing responsibility to the family. Not sure if you meant that or not so apologies in advance if I twisted your words.
Thanks for your well thought out reply.
And to you for yours.
Take care.
Take care.
Quick update to let you know your not the only one with skin in this game...
Wifey just got her SS statement, there has been $57k input to the system between her and her employer. Time to retirement for her, - about 38 years. Assuming she earns 2% more per year (less than traditional inflation), she will have ~200k in her cash in there, plus another $200k from her employer for a total of $400k.
Figure I make 30% more than her, and I will have $300K, plus $300K from employer for a total of $600K.
I figure, SS will have $500k of our money and $1M total from us and our employers by the time we retire.
And that is assuming we get raises that are on average less than historical inflation and zero percent investment growth.
Think we'll get that back?
Please help fix this problem by taking it on sooner rather than later.
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