11 Feb 10
Originally posted by spruce112358Will the elderly get enough to buy themselves some dog food to eat in your enlightened system?
Social security should be enough to live on -- not enough to subsidize extravagant vacations. What you paid in should have nothing to do with what you get out. You get out enough to keep you alive. If you didn't save (or gave it all away), you can rent an apartment and live. That's all it will cover.
So the motto should be: save because SS ain't goin ...[text shortened]... uch.
* and I agree with the notion that is it insurance -- you only get it if you need it.
11 Feb 10
Originally posted by MelanerpesActually, yes, it is.
Social Security is not supposed to be some sort of fancy government-run savings plan.
Do we really need to have the "nanny state" doing this?
Different question; but the government does do this; whether we need it or not.
No1m basically said what I was going to say, so rather than repeat it, I'll just say I agree with his post.
No1 and I are in lockstep on this.
Go figure. 😉
11 Feb 10
2 edits
Originally posted by no1marauderObviously, any plans to change social security would have to be phased in very gradually. And I will concede that, regardless of the original intent, it's become a de facto "fancy government run savings plan".
You're not required to buy fire insurance, so the analogy fails.
It would be inequitable to take 6.2% of people's incomes every paycheck for many years while telling them they would be eligible for X amount of benefits at retirement and then at the last minute tell them that "hey, we've changed our minds; you don't get anything because ally reduced the level of poverty among the elderly and so accomplished its main goal.
But why should we assume we can't find a less expensive or more effective way to meet all the goals that social security is designed to meet?
I would propose that we divide social security into two parts. One part would be the "income insurance plan" part and the other would be the "fancy government-run savings plan".
The income insurance plan would be designed to be cover those would otherwise have nothing - perhaps it could be combined with the SSI program that also serves this purpose. And the "fancy government-run savings plan" could actually set up specific accounts for each worker. We could add extra incentives to encourage people to add money to this account. Perhaps we could allow some of this money to be invested in something besides government bonds.
And maybe we could end up cutting $100-200Bill a year from the $600Bill+ we spend on Social Security that currently goes to pay benefits to people who really don't need them. There would still be plenty left over to pay for those who need them.
My problem is that there seems to be a lot of people out there who hate "big gummint" but they seem to be very short on ideas on things that we might be able to do to improve "big gummint". Social Security is one of the pillars of "big gummint". Surely we can make it better. No one wants to drive a car that was designed in 1935. Why should we rely on a social insurance system that was designed back then?
11 Feb 10
Originally posted by MelanerpesIt's a fallacious argument to say that just because a system was devised in 1935 we shouldn't rely on it now. We should rely on it until something is proposed that is clearly better. I've yet to see a proposal I regard as better than the present system.
Obviously, any plans to change social security would have to be phased in very gradually. And I will concede that, regardless of the original intent, it's become a de facto "fancy government run savings plan".
But why should we assume we can't find a less expensive or more effective way to meet all the goals that social security is designed to meet?
...[text shortened]... 5. Why should we rely on a social insurance system that was designed back then?
The recent history of the financial sector makes me extraordinarily leery of any type of SS private accounts which could very well flow to speculative securities created by that industry. I personally don't find the levels of SS benefits to be particularly generous, so cutting their total level by something like 17-33% certainly seems excessive. Perhaps there are some areas where the system is overly generous (sh76 mentioned one) but perhaps not.
At any rate, only reasonably minor tweaks in the system would return it to fiscal balance for the foreseeable future. The eligibility age probably should be raised to reflect longer life spans; the cap on contributions should be ended. Probably these two things alone would be sufficient to make the program secure for many decades. I see no reason to do anything more; SS has been remarkably successful by any fair measure.
11 Feb 10
Originally posted by no1marauderi remember a friend complaining about the system in texas, where reverse mortgages were illegal. don't know if they still are.
It's a fallacious argument to say that just because a system was devised in 1935 we shouldn't rely on it now. We should rely on it until something is proposed that is clearly better. I've yet to see a proposal I regard as better than the present system.
The recent history of the financial sector makes me extraordinarily leery of any type ...[text shortened]... I see no reason to do anything more; SS has been remarkably successful by any fair measure.
11 Feb 10
Originally posted by no1marauderYes, it may have helped many elderly out of poverty, but you have to take into account the suffering of the people who have to cope with 3 TV's instead of 5, as well.
You're not required to buy fire insurance, so the analogy fails.
It would be inequitable to take 6.2% of people's incomes every paycheck for many years while telling them they would be eligible for X amount of benefits at retirement and then at the last minute tell them that "hey, we've changed our minds; you don't get anything because ...[text shortened]... ally reduced the level of poverty among the elderly and so accomplished its main goal.
11 Feb 10
Originally posted by KazetNagorraif you dictated notes walking to/from the station you could bill that, too!
Hugging the tree or the trip?
It takes about 2 times 1½ hours (plus another 2x30 minutes to walk to and from the railway stations). But that time is not lost as I simply work in the train.
11 Feb 10
2 edits
Originally posted by no1marauderI think a big problem is that, if the goal is too make sure that low income households can
You're not required to buy fire insurance, so the analogy fails.
It would be inequitable to take 6.2% of people's incomes every paycheck for many years while telling them they would be eligible for X amount of benefits at retirement and then at the last minute tell them that "hey, we've changed our minds; you don't get anything because ally reduced the level of poverty among the elderly and so accomplished its main goal.
live during retirement, then the program is wasteful. Even though the system is quite progressive, the SSA still is cutting big checks every year for high income retirees who hit the cap in contributions every year.
It would seem better to set up the same retirement protection for the poor by either reducing the payroll tax rate and means testing assets (with some phase-out range) or eliminate the payroll tax entirely, increase upper-income tax rates (since payroll taxes are currently regressive above the cap) and provide a targeted transfer to the elderly poor for shelter and food. As others have said though you couldn't make the program too generous or else low and even low-middle income households would have little incentive to save.
As I understand it, political considerations played a roll in this. For whatever reason it's easier to get people to pay higher labor income taxes by framing it as a retirement program than as a welfare program.
Edit: I should add that the government does undo some of the waste in a very backwards way by taxing SS benefits.
11 Feb 10
1 edit
Originally posted by no1marauderI agree that there has been a dearth of proposals that are clearly better than what was created in 1935. I'm not saying we should automatically scrap it just because it's old. My challenge to the critics of big gummint is to come up with something that IS clearly better. I'm sure they could come up with some really good ideas if they were to stop focusing ALL their energy on complaining loudly about how "government programs don't work"
It's a fallacious argument to say that just because a system was devised in 1935 we shouldn't rely on it now. We should rely on it until something is proposed that is clearly better. I've yet to see a proposal I regard as better than the present system.
The recent history of the financial sector makes me extraordinarily leery of any type I see no reason to do anything more; SS has been remarkably successful by any fair measure.
The investment in private SS accounts would have to be controlled so that "government" wouldn't be having undue influence over the stock markets or other markets. The details here would be complex - the economic, financial, and other experts can debate the best way to do this.
As for the generosity of the benefits -- it may well be possible to make benefits even more generous for those who really need them, especially with regards to medical expenses. But there are a lot of retirees who have plenty of income and assets to live on and they really don't need to have the government paying them anything.