The most important question for you guys to ask your politicians is what are they going to do to allow Social Security to survive? You are paying 6% or so of your earnings each week into a scam that may not return anything to you upon retirement due to its inevitable collapse without major restructruring.
Charles Krauthammer explains what Social Security is and suggests how to approach the fixes.
http://www.washingtonpost.com/opinions/a-ponzi-scheme-that-should-be-fixed/2011/09/15/gIQAn6EfVK_story.html
http://www.washingtonpost.com/opinions/a-ponzi-scheme-that-should-be-fixed/2011/09/15/gIQAn6EfVK_story.html
Ponzi scheme.....hmmm never really thought of social security in that way. There are definitely some similarities between the two. After reading the article I do think that raising the retirement is necessary. With the majority of our population getting older and older there are more people taking from the pot than adding to it. Needless to say I don't expect to be receiving Social Security when I'm 65. In all actuality I'll be surprised if I ever see it.
ReplyDelete-Todd
May have fixed my commenting! I responded to your comment with my next post but will add to it here.
ReplyDeleteProblem is our committed entitlements are so great that there will not be money to pay them in a few decades. Obama will not touch SS because his base would rebel against this - even though they know it will break the country. This is what I do not understand about the left!
By the way, most public school districts face an identical problem with their commitments to the employees. Obama's stimulus money went in many cases to "plug" this drain on funds!
Walter Williams explains his take on S:
http://townhall.com/columnists/walterewilliams/2011/09/21/gov_perrys_right_about_social_security
So an interesting thought...
ReplyDeleteDo you think that SS was destined to turn into a Ponzi Scheme from the beginning when FDR derived this program during the New Deal? Or do you believe that certain individuals could have corrupted, or taken advantage of, Social Security to cause it to begin its downward spiral into nothingness?
I do not think it was a "ponzi scheme" when implemented - not conciously, anyway. the demographics were probably inconceivable at that time: 1) only 2 or 3 workers paying in for every person receiving benefits (I think it was over 100 workers per receiver when it started!; 2) nobody thought our average age would increase to the high 70's or low 80's as it has. In the 30's most people died near 65 so their assumption was the payout would be relatively small to the elderly. I can forgive all of this.
ReplyDeleteBUT, Milton Freedman, a conservative Economist well respected by all, said - to paraphrase - if the creators had tried to implement each half of Social Security iindependently - it would never have been accepted. That is: 1) a FLAT tax on all workers on the input side and 2) a NON-MEANS TESTED payout on the output side. I think the implementation of this program may have taught the left its current tactics - emotion not logic gaining votes and passing improper legislation - like Bill Clinton and his constant "its for the children" speeches - Obama does the same often. The creators of Social Security pandered by saying "its for the elderly" (implying so they don't starve - though very few in the U.S. ever starved! But it raised votes for FDR and the Dems! Cynical aren't I!
Did they realize the risk they were taking with this illogical legislation? I think they did, but I will not accuse them of purposely developing a "ponzi scheme" - only of pandering for votes - a constant problem in a Republic.
Yes many times, especially for career politicians, what gains votes for the politician is often a top priority and helping the people they represent comes second.
ReplyDeleteSocial Security does need a crucial overall but $64,000 question is what can be done to fix it....if anything at all. Paying into your own social security account does seem like a logical action to take but I do not know how practical that could actually. That also brings up many questions. For example, what if the individual dies before the age they could receive the money. Does it go to the family or does it just go into a government fund of some sort? Questions questions questions.
One thing is for sure though, we will be hearing more and more about this the closer SS becomes broke.
Let me propose "Krehbiel-Security":
ReplyDelete1. Social Security is simply a "welfare program". "Workers" are transferring part of their earnings to the elderly so - in turn - they will avoid poverty when they are elderly.
2. I agree with this goal, but want a system that is "open" and understandable by all.
3. Let the "input" continue at current rates until further notice. This is the payroll deduction.
4. Dispose of the "output" rules and regulation immediately except for those 55 and older. They will continue to receive benefits until death under the groudrules on day of disposal.
5. That gives us 10 or so years - until the 54 year olds reach their retirement to develop an acceptable 1)graduated retirement tax on all workers (I also believe those who earn more should pay more - but it must be simple and avoid loopholes) and 2)a means-tested "output" set of rules to help those who need it - NOT everyone who paid in.
6. This would all be visible and understood by all as a "welfare program" to protect any vulnerable elderly.
Should I start a movement to implement Krehbiel-Security? It would be a positive for the country and the economy, unlike Obamacare!