[el chupacabra]

http://story.news.yahoo.com/news?tmp...i_ge/greenspan


Greenspan says not enought money for SS benefits.
Of course most saw this comming.

"If we have promised more than our economy has the ability to deliver, as I fear we may have, we must recalibrate our public programs so that pending retirees have time to adjust through other channels," Greenspan said.

But then I'm confused. How can the economy not keep up? I thought the economy was doing it bestest since 20 years...

Too bad we can't use that trillion dollar surplus from when the economy was good to help pay for this.

In any case damn those baby boomers for thinking the promise should be fullfilled that they get back some of what they put in. The corporations needed it more .

[BRussell]

So let me get this straight.

1. Greenspan supports marginal tax rate cuts.
2. Greenspan supports payroll tax increases.
3. Greenspan supports social security benefit cuts.

I think we have ourselves a long-term economic plan.

[IonCable]

That's the mistake. The Baby Boomers money went in, but was payed out to those already retired. Just like the money we play now is going to those on SS now. SS is not like a savings account were the money you put into it sits and waits for you. The workers now are paying for the retired now and your children will pay for your SS. The problem is there are less workers and more retired. (No exact numbers) --- But when SS started about 10 workers payed for each SS recipient, now it something like 3 workers for every recipient.

[Millennium]

The current Social Security model is, frankly, unsustainable. While the concept perhaps might not be junked, the implementation needs an overhaul. I think this part, at least, everyone can agree on; the real argument is in terms of how to do it.

[voyageur]

This Boomer remembers being warned of just such a debacle back in the Most Ancient of Days when she was in college. We'll never be able to retire....

[djohnson]

This is why it is best to start multiple retirement plans early. Luckily, since I work for the state, I do not have to pay into SS. Of course this means I dont get to draw what wont be there in the future

[Capt.McDuff]

Pyramid schemes always fail.

Why can't the money being sucked out of our paychecks be held ONLY for us and not put into a common pot for others to take from?

[OSX Abuser]

Plenty of money goes into SS, we just keep taking the money out and replacing it with IOU's

[BRussell]

Social security isn't a pyramid scheme, because people aren't making profits. Current workers pay for current retirees, and then when we retire the then-current workers will pay for us. It's not unlike insurance where the lucky pay for the unlucky. Or even banks. Your money doesn't stay in your savings accounts or mutual funds - the institution uses your money to make more money, and then if you cash out it uses someone else's money to pay you.

Despite doomsday predictions, with just a few moderate changes SS would take care of the baby-boomers just fine. Running up debt so that we have increased interest payments is what you do if you want tax cuts for the rich paid for by social security recipients.

[Capt.McDuff]

It is a pyramid scheme. More people paying in than who are collecting. People collecting who never paid in. People collecting far more than they paid in.

It only thrives if you have a large worker base supporting the entitlements of a few. When the retirement group gets too large (and living too long) then it goes broke.

In short, the older generations figured out a way to screw the younger people and as they go riding around in the gas guzzling RVs we're stuck paying the f-ing bills.

It's time to pull the plug on the comatose patient and allow us to start putting OUR money into OUR own accounts for a change.

[el chupacabra]

People arent that responsible for their money. We need to raise taxes to pay for this so that we can live in a nice civilized country where nobody is starving. Then the government needs to be held responsible with their spending fits.

[Capt.McDuff]

Originally posted by el chupacabra:
People arent that responsible for their money. We need to raise taxes to pay for this so that we can live in a nice civilized country where nobody is starving. Then the government needs to be held responsible with their spending fits.

Cry me a river.

If a person is starving in the United States something is seriously wrong with that person. There is more food in a dumpster than most people overseas eat in a week.

[CRASH HARDDRIVE]

Originally posted by BRussell:
Social security isn't a pyramid scheme, because people aren't making profits.

Which is the very CRUX of the problem. Not making a profit on what should be savings, means the real value of the money the current retirees put in (if they paid in at all) was never preserved. That's the opposite of profit. It's called LOSS.

Current workers pay for current retirees, and then when we retire the then-current workers will pay for us.

Now consider that you're paying for people who worked for far less in physical dollar amounts (during times when those amounts were good incomes) and paid into the system what are in today's numbers paltry sums, with no value preservation. So everyone paying in now must cover the (significant) loss.

Likewise, what you're putting in now will be piddly crap-**** amounts in comparison to what future generations will have to pay in order to make up for the value loss.

Originally posted by el chupacabra:
People arent that responsible for their money

The problem is the government isn’t being responsible with it either, and is just falling back on a ‘taking from Peter to pay Paul’ scheme to make up for that irresponsibility.

It’s an absolutely ridiculous system that operates at such an obvious loss. Put money into a system that’s shuffled right back out the door, and then rely on taxing future generations higher and higher rates to make up for the loss of value preservation in the original sum. That’s freakin’ insanity and a house of cards that can’t possibly sustain itself.

The usual thoughtless approach of just “Tax ‘the rich’ higher and higher to pay for what the system loses!” is typical feel-good, band-aid workaround, rather than actually have to address (let alone fix) the core of the problem itself.

I’d be in favor of a system that operated more like a true investment savings account- the actual sum of money a person pays into the SS system being put into an investment account that isn’t drawn on by anyone in the present time. That money should then grow and compound over time, so that by the time a person retires, the money has actually been put to work over time like any investment amount should. To all the worrywarts who whiz themselves at the thought of investment ‘risk’- even the WORST POSSIBLE private investment account with the most dogshit return, even suffering through 40-50 years of recession/boom economy cycles, would beat the literal stuffing out of the non-existent ‘return’ of the SS system as it stands today.

Any such system would most certainly be more ‘responsible’ than the ridiculous revolving door SS system as it stands now.

[vmarks]

http://www.cato.org/pubs/ssps/ssp8.html

In this study, Peter Ferrara offers a proposal based on the following key elements:

* Current workers could be free to choose either the private option or Social Security. For those who choose the private plan, workers and employers will each pay 5 percent of wages, instead of the current Social Security payroll tax of 6.2 percent for each, into private investment accounts, resulting in an eventual payroll tax cut of 20 percent. Besides supporting retirement benefits, the accounts would finance private life and disability insurance, thus replacing Social Security survivors and disability benefits.


* Workers who opt out of the current Social Security system would receive recognition bonds from the federal government that would pay them a proportion of future Social Security benefits equal to the proportion of lifetime taxes they had already paid.


* Benefits promised to current retirees would be paid in full, with no reduction of any kind.

The biggest objection to privatizing Social Security has been the transition to a privatized system. But the projections of the fiscal impact of the plan offered in this study show that the transition can be financed without new taxes and without cutting benefits for today’s recipients.

Indeed, the yearly transition deficit would be offset after about 14 years. After that, the privatization reform actually starts producing a surplus for the federal government. About 20 years after the reform is begun, that surplus would be large enough in 1996 dollars to eliminate completely a federal deficit as large as today’s.

These projections place the transition in a whole new perspective. They show that the transition is financially feasible and manageable, and that modest short-term sacrifices would lead to long-term surpluses that would ultimately reduce the federal budget deficit.

[Capt.McDuff]

Problem is that it requires getting the politicians to keep their hands off of our money. That isn't going to happen. The AARP isn't about to let the politicians extend retirement age or cut benefits. I'm tired of paying into a system that quite possibly isn't going to give me what I pay into it let alone give me the slight profit I deserve since my money is being tied up in a scheme I don't approve of.

Why the hell can't I simply opt out and put the money into the savings mechanism of my choice?