What Would You Be Willing to Do to Save SS?

[Anonymous]

Hmmm. Maybe I'll send 8:45's posts to some prominent (as in thought leaders, always quoted on SS issues) conservatives I know and let them tear him to shreds. He might find them more convincing.

[Anonymous]

Anonymous wrote:SS, in its current form, is projected to run dry by 2034. (And while some people are talking about increasing benefits, it's obvious we need to cut.) From what I understand, a couple of minor "tweaks" can save the program. What would you be willing to sacrifice? I would vote for three changes:

1) Gradually increase the full retirement age to 68. ?There should be no change for people within 10 years of retirement, but for others, we could add a month every year until we get to 68. When SS was introduced, people barely lived 5 years past retirement age (on average), and now we have people claiming for 20 to 30 years.

2) Increase the cap on the amount people pay the SS tax.

3) Lower the benefits for people in the uppermost brackets - in retirement - by about 25%. My parents have a retirement income of about $150k - no pensions, just responsible lifelong savings and investments - and they tell me they wouldn't miss a SS cut of a few hundred dollars a month.

Opinions?

No to #1 and #3.

1) Just no. While people are living longer, they aren't necessarily able to work longer. The onset of chronic and debilitating issues is still the age it has always been (early 60s).

2) This is the solution: Increase the cap on income people pay the SS tax on. This should've happened a long time ago.

3) No. The reason people are willing to pay SS taxes is because they don't look at it as a government welfare program that only benefits the poor. They see it as something that will pay out. If you are going to increase the amount of income that is taxed but then cut benefits for certain people, you will lose support for SS long term. If people perceive it as a program for the poor, it will lose its support. You also don't want to create a disincentive for saving. I would only support decreasing benefits for the top 1 percent. But I'm squeamish about that. The thing is that there aren't many government programs that help the middle class -- not the poor, not the wealthy -- the middle class. Two programs that do help the middle class are Social Security and the mortgage interest deduction. The mortgage interest deduction helps the middle class because it enables people who otherwise wouldn't be able to to itemize their deductions, which usually saves them in taxes. And yet we're always talking about doing away with those things. We shouldn't be. What we don't want to do is further hollow out the middle class.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP here. Does anyone know how high up the income ladder we need to move the cap to keep the program solvent for the next 75 years? An increase to $200k would be around an extra $5000 - manageable at that level, and perhaps it could even be viewed as a wise " investment"' to ensure the program is solvent when it's time to claim. (The other "half" would have to be paid by the employer, but again, not a deal-killer at that level.)

While I like the idea of raising the cap, for political purposes it would be easier to get through if changes are seen as a "shared burden." How high would the cap have to be raised if we ALSO moved the retirement age up by one year, gradually over time?

I ask because we seem to have some very knowledgeable people responding. Anyone know the numbers?

Hi Op, this is the PP from last night. Your questions are good ones. The answers will feed into any political compromise about Social Security, including the one I mentioned earlier this am about deciding at what level to set benefit levels under Social Security as a pay-as-you-go first-tier benefit. There seems to be a growing consensus around that one. Two guys from Heritage (very right) and Brookings (middle-of-the-road/left) collaborated on inventing the auto-IRA (personal savings) tier. Obviously conservatives would like a lower first tier SS system, but at this point I only know of a few conservatives, and these guys are really out there on the right, who are still saying publicly that it's a good idea to do away with a first-tier guaranteed, inflation-indexed SS benefit completely. Most conservatives get that asking their housekeepers to save the necessary 15% out of their incomes just isn't going to happen, politically or realistically, and so we need SS's progressive structure to give low-income workers a solid base for retirement. Liberals are happily working away on the 2nd tier personal savings (auto-IRA) part. Really there does seem to be room for consensus here.

So yes, your questions will be important in establishing a solid first tier of SS benefits. Here are some thoughts. I have to run off soon, but this should get you started.

1. You're correct that a balance of benefit cuts and tax increases would be more politically realistic. In fact, balance between tax increases and benefit cuts was the stated goal of Reagan's Greenspan commission in the early 1980s.
2. You're correct that raising the retirement age is effectively a benefit cut. As you probably know, but others may not, there's a reduction to monthly benefit amounts if you claim your benefits before your early retirement age. If you raise everybody's retirement age, then somebody who still claims at a given age (62, 63 or whenever) gets an even bigger cut than they do today.
3. An issue with raising the retirement age, as some have mentioned, is that some workers who do hard labor can't keep working past 62. It's not going to work to ask people to do construction work or lift heavy things at age 63. So you need a plan to protect these people, and that's going to cost money. So far nobody has come up with a good solution for identifying who needs to be protected or how to help them.
4. Re raising the income cap, many shy away from completely eliminating the cap, for political reasons. Instead, most proposals would raise the cap to cover 90% of national aggregate wages (long story, but historically the cap covered 90% but growing income inequality has changed that). Or, some proposals would do a donut as somebody mentioned. Or, some proposals would tax all wages/salaries above the current cap, but they'd only tax the higher wages/salaries at 3%. As an aside, I didn't totally follow the response that said the increase would be more than $5K, but to the extent that person said that workers generally absorb any payroll tax increases in the form of lower wages, that's true.
5. Also re raising the income cap, many proposals would pay more benefits to those who have to contribute more because they're above the current cap. It's a tough call. Do we want to pay Bill Gates more benefits? On the other hand, for a lot of people earning somewhat less above $118,000, paying more benefits seems a reasonable compromise.

Some of the links I gave you go through these issues in more detail.

OK, on to solvency estimates. That will be my next post.

Hi PP....thanks for your insights. (I'm curious if you work with the SS program since you are obviously so knowledgeable.)
1. FWIW, I'm a moderate conservative and feel strongly, as you've noted, that changes to SS need to be a balance of tax increases (on the higher income via the cap adjustment) and a reduction of benefits (via a delay of one year for full retirement benefits). It's true, though, that those who do physical labor would find the latter difficult, if not impossible, and I have no idea how to allow for that. (Having two different "start dates" depending on class of labor or even average wages would not be politically feasible, IMO.)
2. Re the Increased benefits for those who pay more as a consequence of raising the cap, wouldn't that defeat the purpose to a large extent? If we collect more from the higher earners, only to return it in the form of increased benefits, wouldn't that be a wash? (Although I suppose there is room for negotiation here, too. Maybe return somewhat higher benefits by not so much as to offset the higher contribution totally?)
3. I'm unaware of the issue with the cap covering 90% of aggregate wages, but if historically this has been the case and we've "slipped" due to rising inequality, that seems like a politically palatable way to present the cap increase.
4. Finally, while SS needs to be "fixed" and I am very interested in how to accomplish this (I have no particular role other than a concerned citizen), a big problem is that many people have come to rely upon the program as their sole plan for retirement when it was always intended as just one leg of the stool - the others being pensions and savings. Pensions have largely disappeared (for the private sector), and savings are alarmingly low. While the difficulty in saving is apparent among the lower-income, there are far too many people in the UM brackets who spend right up to their means (or beyond!), and give no priority to savings. The WP had a survey recently showing that among those earning $100k plus, fully 20% could not come up with $400 for an emergency (or would have a challenge doing so).

Again, PP, thanks for all the information. I'll look forward to the solvency info, but if you don't hear back from me right away, it's because I have a "day" planned. I will check out any additional postings from you when I get back.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

What the hell are you ranting about? I've only made two posts in this thread and you quoted both of them. Nice job ranting at me for things I didn't post.

1. Population aging is a filunction of low population growth. The poster I was responding to was clearly suggesting that population growth in absolute terms created the SS mess, not that lack of population growth created the mess.

2. Let me get this straight: That SS will continue to pay out 75% of benefits is a positive? The program will cost five (perhaps six) times what it was originally projected to cost and will deliver only 75% of its benefits. Only a leftist would hold this out as a success or positive. That's a hell of a consolation prize.

3. You claim that SS is free of investment risk and will remain an inflation adjusted source of income. First, those are some pretty incredible claims to make in the same post in which you acknowledge that SS will soon only be capable of paying out 75% of its obligations. You're really arguing that a quasi-retirement program that needs ever escalating amounts of money confiscated through state power and that continuously faces near term shortfalls is free of investment risk? Second, SS is only free of investment risk and a good guard against inflation if you assume the federal government is incapable of default and if you believe that the dollar will remain a reserve currency forever. I wouldn't bet a mortgage payment on either of those assumptions, let alone 5-6% of the national GDP. Your claims are borderline irrational at this point.

4. The real problem is that the political left simply doesn't have the will to accurately price entitlements (e.g., Obamacare, nationalization of student loan program). As a result, entitlement programs virtually always cost more than originally projected and deliver fewer benefits than were originally promised. While myRAs are a decent concept in the abstract, what do you think is going to happen to short term economic growth when employees have fewer discretionary dollars to spend? Do you really believe hat state and federal governmwnts are going to be able to restrain themselves from trying to funnel myRAs toward government debt (increasing systemic risk in the process). Sure, in 30-40 years things should balance out if governments don't default in heir debts, but there will be short term pain.

5. SS will be significantly restructured at some point in time and some cohort of beneficiaries will feel significant financial pain from it. The only relevant questions are when will it happen and how bad will it hurt.

6. Your solution is to simply do the same thing that has been done for 75 years: throw more money at the problem through higher taxes and additionally reduce discretionary income through myRA plans. This time things will be different, right?

Oh FFS. Grow up and act like an adult, and argue like one.

Your uninformed ranting doesn't deserve a lengthy response.
1. If you can't understand the dependency ratio, I can't help you. However, you've basically admitted that I'm right about population aging, even if you tried to twist my argument around.
2. Social Security continues to keep 1/3 of older Americans out of poverty, and yes, that's a huge success. If you're one of those conservatives who thinks the elderly need to go back to living off cat food, again, I can't help you.
3. You're confusing investment risk with political risk--I was very careful to choose my terms but you obviously can't see the distinction. Again, I can't help you become smarter.
4. You're confusing Obama's myRAs with state autoIRA proposals, but these are two very different things. Also, you seem unaware that auto-IRA proposals would rely on private investment managers, so the state or federal governments involved would not handle the funds. Even if the government did handle the auto-IRA funds (which it won't), you also missed the post above about how government bonds as investments are backed by the full faith and credit of the US government and would take Congressional action to change--reading comprehension really doesn't seem to be your strong suit.

For the rest, yes I agree there will be restructuring. But even Trump doesn't think SS should go away completely. Trump has actually said that he wants to preserve Social Security in its present form, all of it. You're out of step with most of your conservative buddies. There's much more likelihood than you want to think that there will be a compromise that preserves a solid first tier benefit, and one that will help the poor in particular.

(And huh? You say I quoted both of your two posts, and so you're mad that I'm talking to you? Huh?)

1. If you wanted to suggest that the LACK of population growth was the problem you should have said that. Don't blame me for your poor writing.

2. Re: SS keeping aging Americans out of poverty being a success: almost any problem can be solved by throwing money at it. Here in reality land, we have finite resources and infinite needs. Hence, achieving an outcome is not enough to declare something a success or failure. In reality land, we have to choose how to allocate our resources efficiently. SS supporters have utterly failed for 75 years to efficiently allocate resources to this issue and we once again are talking about devoting even more resources to the problem. This time, things will turn out different right? That's what you really believe, right? That the problem is that it needs just a little bit more money through a combo of higher taxes and reduced benefits for certain segments of the population? I sort of admire you--a lesser person would be humbled by 75 years of failure. But not you.

3. Political risk IS investment risk, genius. Those of us who actually allocate capital for living generally refer to it as regulatory risk. Call it whatever you want, it IS rolled into the more encompassing concept of investment risk.

4. Distinctions between auto-IRAs and the myRA proposal notwithstanding, the full faith and credit of the US government is a function of the government's ability to pay its debts. That you think congressional action means anything with respect to the governments ability to pay its debts is completing missing the issue. Hint: if the money is not there, Congress' action or inaction is completely irrelevant.

Apetitie for political compromise and the wisdom of the policy changes flowing from such compromise are two entirely different issues. De Tocqueville diagnosed the limit of the American republic in 1835. That politicians on the left and right have a desire to kick the problem down the road through political compromise is not in and of itself an indication that preservation of SS is a good idea. And if not wanting my kids to have to bear the burden of bad policy decisions made today makes me a political outlier, so be it.

Go back and re-read your first paragraph at 7:45 last night. Except for three (now four) posts in this sub-conversation, I haven't posted in this thread. All of those topics you claimed you had to educate me on we're never raised by me that was a different poster and your ranting in that first paragraph had nothing to do with me even though you directed that screed at me.

Also, you rightky bring up the unfunded Bush wars as a problem with conservative governance. I don't defend the financing of Bush's wars. But it is worth noting that the total unfunded liability for that garbage was about $3.5T-4.0T. A staggering sum to say the least. Yet it pales in comparison to the $75T unfunded SS liability and even bigger unfunded MC liability. Conservatives should be humbled by Bush's mistakes. But, from an economic perspective, even given the longer time horizon, the unfunded liabilities arising out of SS and MC are much worse than Bush's unfunded wars. I guess massive finacial mistakes are only a problem when Republicans make the mistake, right? For liberals, it's only a reason to double down on what hasn't worked for 75 years.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

What the hell are you ranting about? I've only made two posts in this thread and you quoted both of them. Nice job ranting at me for things I didn't post.

1. Population aging is a filunction of low population growth. The poster I was responding to was clearly suggesting that population growth in absolute terms created the SS mess, not that lack of population growth created the mess.

2. Let me get this straight: That SS will continue to pay out 75% of benefits is a positive? The program will cost five (perhaps six) times what it was originally projected to cost and will deliver only 75% of its benefits. Only a leftist would hold this out as a success or positive. That's a hell of a consolation prize.

3. You claim that SS is free of investment risk and will remain an inflation adjusted source of income. First, those are some pretty incredible claims to make in the same post in which you acknowledge that SS will soon only be capable of paying out 75% of its obligations. You're really arguing that a quasi-retirement program that needs ever escalating amounts of money confiscated through state power and that continuously faces near term shortfalls is free of investment risk? Second, SS is only free of investment risk and a good guard against inflation if you assume the federal government is incapable of default and if you believe that the dollar will remain a reserve currency forever. I wouldn't bet a mortgage payment on either of those assumptions, let alone 5-6% of the national GDP. Your claims are borderline irrational at this point.

4. The real problem is that the political left simply doesn't have the will to accurately price entitlements (e.g., Obamacare, nationalization of student loan program). As a result, entitlement programs virtually always cost more than originally projected and deliver fewer benefits than were originally promised. While myRAs are a decent concept in the abstract, what do you think is going to happen to short term economic growth when employees have fewer discretionary dollars to spend? Do you really believe hat state and federal governmwnts are going to be able to restrain themselves from trying to funnel myRAs toward government debt (increasing systemic risk in the process). Sure, in 30-40 years things should balance out if governments don't default in heir debts, but there will be short term pain.

5. SS will be significantly restructured at some point in time and some cohort of beneficiaries will feel significant financial pain from it. The only relevant questions are when will it happen and how bad will it hurt.

6. Your solution is to simply do the same thing that has been done for 75 years: throw more money at the problem through higher taxes and additionally reduce discretionary income through myRA plans. This time things will be different, right?

Oh FFS. Grow up and act like an adult, and argue like one.

Your uninformed ranting doesn't deserve a lengthy response.
1. If you can't understand the dependency ratio, I can't help you. However, you've basically admitted that I'm right about population aging, even if you tried to twist my argument around.
2. Social Security continues to keep 1/3 of older Americans out of poverty, and yes, that's a huge success. If you're one of those conservatives who thinks the elderly need to go back to living off cat food, again, I can't help you.
3. You're confusing investment risk with political risk--I was very careful to choose my terms but you obviously can't see the distinction. Again, I can't help you become smarter.
4. You're confusing Obama's myRAs with state autoIRA proposals, but these are two very different things. Also, you seem unaware that auto-IRA proposals would rely on private investment managers, so the state or federal governments involved would not handle the funds. Even if the government did handle the auto-IRA funds (which it won't), you also missed the post above about how government bonds as investments are backed by the full faith and credit of the US government and would take Congressional action to change--reading comprehension really doesn't seem to be your strong suit.

For the rest, yes I agree there will be restructuring. But even Trump doesn't think SS should go away completely. Trump has actually said that he wants to preserve Social Security in its present form, all of it. You're out of step with most of your conservative buddies. There's much more likelihood than you want to think that there will be a compromise that preserves a solid first tier benefit, and one that will help the poor in particular.

(And huh? You say I quoted both of your two posts, and so you're mad that I'm talking to you? Huh?)

PS, re #3, if you think Congress will stop funding Social Security to their constituents, you don't understand Congress. Social Security was the piece that led to resolution in the past several budget and debt ceiling crises. That's right, Congress acted only when the debt ceiling reached the point where it would be impossible to pay Social Security benefits. Congress is deathly scared that their constitutents' checks won't arrive on time.

Of course Congress won't stop funding SS. But that doesn't mean that SS will be funded forever. Eventually the capacity to continue borrowing will be exhausted.

[Anonymous]

Anonymous wrote:I think I would stop the ability to claim SS if you've never paid in.

This.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

What the hell are you ranting about? I've only made two posts in this thread and you quoted both of them. Nice job ranting at me for things I didn't post.

1. Population aging is a filunction of low population growth. The poster I was responding to was clearly suggesting that population growth in absolute terms created the SS mess, not that lack of population growth created the mess.

2. Let me get this straight: That SS will continue to pay out 75% of benefits is a positive? The program will cost five (perhaps six) times what it was originally projected to cost and will deliver only 75% of its benefits. Only a leftist would hold this out as a success or positive. That's a hell of a consolation prize.

3. You claim that SS is free of investment risk and will remain an inflation adjusted source of income. First, those are some pretty incredible claims to make in the same post in which you acknowledge that SS will soon only be capable of paying out 75% of its obligations. You're really arguing that a quasi-retirement program that needs ever escalating amounts of money confiscated through state power and that continuously faces near term shortfalls is free of investment risk? Second, SS is only free of investment risk and a good guard against inflation if you assume the federal government is incapable of default and if you believe that the dollar will remain a reserve currency forever. I wouldn't bet a mortgage payment on either of those assumptions, let alone 5-6% of the national GDP. Your claims are borderline irrational at this point.

4. The real problem is that the political left simply doesn't have the will to accurately price entitlements (e.g., Obamacare, nationalization of student loan program). As a result, entitlement programs virtually always cost more than originally projected and deliver fewer benefits than were originally promised. While myRAs are a decent concept in the abstract, what do you think is going to happen to short term economic growth when employees have fewer discretionary dollars to spend? Do you really believe hat state and federal governmwnts are going to be able to restrain themselves from trying to funnel myRAs toward government debt (increasing systemic risk in the process). Sure, in 30-40 years things should balance out if governments don't default in heir debts, but there will be short term pain.

5. SS will be significantly restructured at some point in time and some cohort of beneficiaries will feel significant financial pain from it. The only relevant questions are when will it happen and how bad will it hurt.

6. Your solution is to simply do the same thing that has been done for 75 years: throw more money at the problem through higher taxes and additionally reduce discretionary income through myRA plans. This time things will be different, right?

Oh FFS. Grow up and act like an adult, and argue like one.

Your uninformed ranting doesn't deserve a lengthy response.
1. If you can't understand the dependency ratio, I can't help you. However, you've basically admitted that I'm right about population aging, even if you tried to twist my argument around.
2. Social Security continues to keep 1/3 of older Americans out of poverty, and yes, that's a huge success. If you're one of those conservatives who thinks the elderly need to go back to living off cat food, again, I can't help you.
3. You're confusing investment risk with political risk--I was very careful to choose my terms but you obviously can't see the distinction. Again, I can't help you become smarter.
4. You're confusing Obama's myRAs with state autoIRA proposals, but these are two very different things. Also, you seem unaware that auto-IRA proposals would rely on private investment managers, so the state or federal governments involved would not handle the funds. Even if the government did handle the auto-IRA funds (which it won't), you also missed the post above about how government bonds as investments are backed by the full faith and credit of the US government and would take Congressional action to change--reading comprehension really doesn't seem to be your strong suit.

For the rest, yes I agree there will be restructuring. But even Trump doesn't think SS should go away completely. Trump has actually said that he wants to preserve Social Security in its present form, all of it. You're out of step with most of your conservative buddies. There's much more likelihood than you want to think that there will be a compromise that preserves a solid first tier benefit, and one that will help the poor in particular.

(And huh? You say I quoted both of your two posts, and so you're mad that I'm talking to you? Huh?)

PS, re #3, if you think Congress will stop funding Social Security to their constituents, you don't understand Congress. Social Security was the piece that led to resolution in the past several budget and debt ceiling crises. That's right, Congress acted only when the debt ceiling reached the point where it would be impossible to pay Social Security benefits. Congress is deathly scared that their constitutents' checks won't arrive on time.

Of course Congress won't stop funding SS. But that doesn't mean that SS will be funded forever. Eventually the capacity to continue borrowing will be exhausted.

The borrowing is temporary to cover the baby boomers. A permanent solution for the next generation does not require borrowing.

[Anonymous]

The federal government does not see it as a welfare program, but an investment into your retirement. Curent federal government employees are repeatedly informed that their retirement has thepree legs: TSP, FErS pension, and SS. If the government suddenly began telling its employees that it's only three legs if the employee has not saved enough in their TSP, how many people do you think would be diligent about putting money aside? i definitely would not. I can find ways to use some of that Biweekly deduction into TsP right now. I'm sure it's the same for people who are non-federal employees, denying themselves today as they plan for the future.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

What the hell are you ranting about? I've only made two posts in this thread and you quoted both of them. Nice job ranting at me for things I didn't post.

1. Population aging is a filunction of low population growth. The poster I was responding to was clearly suggesting that population growth in absolute terms created the SS mess, not that lack of population growth created the mess.

2. Let me get this straight: That SS will continue to pay out 75% of benefits is a positive? The program will cost five (perhaps six) times what it was originally projected to cost and will deliver only 75% of its benefits. Only a leftist would hold this out as a success or positive. That's a hell of a consolation prize.

3. You claim that SS is free of investment risk and will remain an inflation adjusted source of income. First, those are some pretty incredible claims to make in the same post in which you acknowledge that SS will soon only be capable of paying out 75% of its obligations. You're really arguing that a quasi-retirement program that needs ever escalating amounts of money confiscated through state power and that continuously faces near term shortfalls is free of investment risk? Second, SS is only free of investment risk and a good guard against inflation if you assume the federal government is incapable of default and if you believe that the dollar will remain a reserve currency forever. I wouldn't bet a mortgage payment on either of those assumptions, let alone 5-6% of the national GDP. Your claims are borderline irrational at this point.

4. The real problem is that the political left simply doesn't have the will to accurately price entitlements (e.g., Obamacare, nationalization of student loan program). As a result, entitlement programs virtually always cost more than originally projected and deliver fewer benefits than were originally promised. While myRAs are a decent concept in the abstract, what do you think is going to happen to short term economic growth when employees have fewer discretionary dollars to spend? Do you really believe hat state and federal governmwnts are going to be able to restrain themselves from trying to funnel myRAs toward government debt (increasing systemic risk in the process). Sure, in 30-40 years things should balance out if governments don't default in heir debts, but there will be short term pain.

5. SS will be significantly restructured at some point in time and some cohort of beneficiaries will feel significant financial pain from it. The only relevant questions are when will it happen and how bad will it hurt.

6. Your solution is to simply do the same thing that has been done for 75 years: throw more money at the problem through higher taxes and additionally reduce discretionary income through myRA plans. This time things will be different, right?

Oh FFS. Grow up and act like an adult, and argue like one.

Your uninformed ranting doesn't deserve a lengthy response.
1. If you can't understand the dependency ratio, I can't help you. However, you've basically admitted that I'm right about population aging, even if you tried to twist my argument around.
2. Social Security continues to keep 1/3 of older Americans out of poverty, and yes, that's a huge success. If you're one of those conservatives who thinks the elderly need to go back to living off cat food, again, I can't help you.
3. You're confusing investment risk with political risk--I was very careful to choose my terms but you obviously can't see the distinction. Again, I can't help you become smarter.
4. You're confusing Obama's myRAs with state autoIRA proposals, but these are two very different things. Also, you seem unaware that auto-IRA proposals would rely on private investment managers, so the state or federal governments involved would not handle the funds. Even if the government did handle the auto-IRA funds (which it won't), you also missed the post above about how government bonds as investments are backed by the full faith and credit of the US government and would take Congressional action to change--reading comprehension really doesn't seem to be your strong suit.

For the rest, yes I agree there will be restructuring. But even Trump doesn't think SS should go away completely. Trump has actually said that he wants to preserve Social Security in its present form, all of it. You're out of step with most of your conservative buddies. There's much more likelihood than you want to think that there will be a compromise that preserves a solid first tier benefit, and one that will help the poor in particular.

(And huh? You say I quoted both of your two posts, and so you're mad that I'm talking to you? Huh?)

PS, re #3, if you think Congress will stop funding Social Security to their constituents, you don't understand Congress. Social Security was the piece that led to resolution in the past several budget and debt ceiling crises. That's right, Congress acted only when the debt ceiling reached the point where it would be impossible to pay Social Security benefits. Congress is deathly scared that their constitutents' checks won't arrive on time.

Of course Congress won't stop funding SS. But that doesn't mean that SS will be funded forever. Eventually the capacity to continue borrowing will be exhausted.

The borrowing is temporary to cover the baby boomers. A permanent solution for the next generation does not require borrowing.

A permenant solution for the next generation does not require borrowing if the economic and demographic assumptions underlying such solution prove to be correct. The fundamental problem is that politicians are incentivized to choose the most optimistic assumptions possible in designing/modifying entitlement programs in order to keep the cost of those programs to a minimum (see Obamacare). Hence, entitlement programs tend to cost more than projected and deliver less benefit than promised because the best case projection rarely comes to fruition. Hence, SS needs an ever increasing amount of resources. The solution typically takes the form of significant tax increases every 10-15 years. This has been happening for 75 years and every single time people are convinced that government is enacting the permenant solution that will address solvency problems inherent to the program itself.

[Anonymous]

Anonymous wrote:The federal government does not see it as a welfare program, but an investment into your retirement. Curent federal government employees are repeatedly informed that their retirement has thepree legs: TSP, FErS pension, and SS. If the government suddenly began telling its employees that it's only three legs if the employee has not saved enough in their TSP, how many people do you think would be diligent about putting money aside? i definitely would not. I can find ways to use some of that Biweekly deduction into TsP right now. I'm sure it's the same for people who are non-federal employees, denying themselves today as they plan for the future.

So the solution is a "pay as you go" program that puts a continually increasing burden on subsequent generations when those subsequent generations had nothing to do with making the problem worse in the first place? If you have no problem doing that to your kids and grandkids i don't think we're going to find much common ground on any topics.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

What the hell are you ranting about? I've only made two posts in this thread and you quoted both of them. Nice job ranting at me for things I didn't post.

1. Population aging is a filunction of low population growth. The poster I was responding to was clearly suggesting that population growth in absolute terms created the SS mess, not that lack of population growth created the mess.

2. Let me get this straight: That SS will continue to pay out 75% of benefits is a positive? The program will cost five (perhaps six) times what it was originally projected to cost and will deliver only 75% of its benefits. Only a leftist would hold this out as a success or positive. That's a hell of a consolation prize.

3. You claim that SS is free of investment risk and will remain an inflation adjusted source of income. First, those are some pretty incredible claims to make in the same post in which you acknowledge that SS will soon only be capable of paying out 75% of its obligations. You're really arguing that a quasi-retirement program that needs ever escalating amounts of money confiscated through state power and that continuously faces near term shortfalls is free of investment risk? Second, SS is only free of investment risk and a good guard against inflation if you assume the federal government is incapable of default and if you believe that the dollar will remain a reserve currency forever. I wouldn't bet a mortgage payment on either of those assumptions, let alone 5-6% of the national GDP. Your claims are borderline irrational at this point.

4. The real problem is that the political left simply doesn't have the will to accurately price entitlements (e.g., Obamacare, nationalization of student loan program). As a result, entitlement programs virtually always cost more than originally projected and deliver fewer benefits than were originally promised. While myRAs are a decent concept in the abstract, what do you think is going to happen to short term economic growth when employees have fewer discretionary dollars to spend? Do you really believe hat state and federal governmwnts are going to be able to restrain themselves from trying to funnel myRAs toward government debt (increasing systemic risk in the process). Sure, in 30-40 years things should balance out if governments don't default in heir debts, but there will be short term pain.

5. SS will be significantly restructured at some point in time and some cohort of beneficiaries will feel significant financial pain from it. The only relevant questions are when will it happen and how bad will it hurt.

6. Your solution is to simply do the same thing that has been done for 75 years: throw more money at the problem through higher taxes and additionally reduce discretionary income through myRA plans. This time things will be different, right?

Oh FFS. Grow up and act like an adult, and argue like one.

Your uninformed ranting doesn't deserve a lengthy response.
1. If you can't understand the dependency ratio, I can't help you. However, you've basically admitted that I'm right about population aging, even if you tried to twist my argument around.
2. Social Security continues to keep 1/3 of older Americans out of poverty, and yes, that's a huge success. If you're one of those conservatives who thinks the elderly need to go back to living off cat food, again, I can't help you.
3. You're confusing investment risk with political risk--I was very careful to choose my terms but you obviously can't see the distinction. Again, I can't help you become smarter.
4. You're confusing Obama's myRAs with state autoIRA proposals, but these are two very different things. Also, you seem unaware that auto-IRA proposals would rely on private investment managers, so the state or federal governments involved would not handle the funds. Even if the government did handle the auto-IRA funds (which it won't), you also missed the post above about how government bonds as investments are backed by the full faith and credit of the US government and would take Congressional action to change--reading comprehension really doesn't seem to be your strong suit.

For the rest, yes I agree there will be restructuring. But even Trump doesn't think SS should go away completely. Trump has actually said that he wants to preserve Social Security in its present form, all of it. You're out of step with most of your conservative buddies. There's much more likelihood than you want to think that there will be a compromise that preserves a solid first tier benefit, and one that will help the poor in particular.

(And huh? You say I quoted both of your two posts, and so you're mad that I'm talking to you? Huh?)

PS, re #3, if you think Congress will stop funding Social Security to their constituents, you don't understand Congress. Social Security was the piece that led to resolution in the past several budget and debt ceiling crises. That's right, Congress acted only when the debt ceiling reached the point where it would be impossible to pay Social Security benefits. Congress is deathly scared that their constitutents' checks won't arrive on time.

Of course Congress won't stop funding SS. But that doesn't mean that SS will be funded forever. Eventually the capacity to continue borrowing will be exhausted.

The borrowing is temporary to cover the baby boomers. A permanent solution for the next generation does not require borrowing.

A permenant solution for the next generation does not require borrowing if the economic and demographic assumptions underlying such solution prove to be correct. The fundamental problem is that politicians are incentivized to choose the most optimistic assumptions possible in designing/modifying entitlement programs in order to keep the cost of those programs to a minimum (see Obamacare). Hence, entitlement programs tend to cost more than projected and deliver less benefit than promised because the best case projection rarely comes to fruition. Hence, SS needs an ever increasing amount of resources. The solution typically takes the form of significant tax increases every 10-15 years. This has been happening for 75 years and every single time people are convinced that government is enacting the permenant solution that will address solvency problems inherent to the program itself.

This is a fundamental problem of life itself. Every single project undertaken by every corporation, every job started by every individual, every car you ever bought was done based on assumptions that usually turn out too optimistic. There is just no way around this, except maybe we could let poor old people just starve to death unless some easily curable disease gets them first.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I think I would stop the ability to claim SS if you've never paid in.

Who gets SS if they don't pay in? I thought you had to have 40 quarters of earning, and the benefit is figured in your top 35 years.

DH grandma got SS for decades after her husband died. She never worked a job a day in her life. I'm certain she was not a citizen but drew a check for almost 50 years.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

What the hell are you ranting about? I've only made two posts in this thread and you quoted both of them. Nice job ranting at me for things I didn't post.

1. Population aging is a filunction of low population growth. The poster I was responding to was clearly suggesting that population growth in absolute terms created the SS mess, not that lack of population growth created the mess.

2. Let me get this straight: That SS will continue to pay out 75% of benefits is a positive? The program will cost five (perhaps six) times what it was originally projected to cost and will deliver only 75% of its benefits. Only a leftist would hold this out as a success or positive. That's a hell of a consolation prize.

3. You claim that SS is free of investment risk and will remain an inflation adjusted source of income. First, those are some pretty incredible claims to make in the same post in which you acknowledge that SS will soon only be capable of paying out 75% of its obligations. You're really arguing that a quasi-retirement program that needs ever escalating amounts of money confiscated through state power and that continuously faces near term shortfalls is free of investment risk? Second, SS is only free of investment risk and a good guard against inflation if you assume the federal government is incapable of default and if you believe that the dollar will remain a reserve currency forever. I wouldn't bet a mortgage payment on either of those assumptions, let alone 5-6% of the national GDP. Your claims are borderline irrational at this point.

4. The real problem is that the political left simply doesn't have the will to accurately price entitlements (e.g., Obamacare, nationalization of student loan program). As a result, entitlement programs virtually always cost more than originally projected and deliver fewer benefits than were originally promised. While myRAs are a decent concept in the abstract, what do you think is going to happen to short term economic growth when employees have fewer discretionary dollars to spend? Do you really believe hat state and federal governmwnts are going to be able to restrain themselves from trying to funnel myRAs toward government debt (increasing systemic risk in the process). Sure, in 30-40 years things should balance out if governments don't default in heir debts, but there will be short term pain.

5. SS will be significantly restructured at some point in time and some cohort of beneficiaries will feel significant financial pain from it. The only relevant questions are when will it happen and how bad will it hurt.

6. Your solution is to simply do the same thing that has been done for 75 years: throw more money at the problem through higher taxes and additionally reduce discretionary income through myRA plans. This time things will be different, right?

Oh FFS. Grow up and act like an adult, and argue like one.

Your uninformed ranting doesn't deserve a lengthy response.
1. If you can't understand the dependency ratio, I can't help you. However, you've basically admitted that I'm right about population aging, even if you tried to twist my argument around.
2. Social Security continues to keep 1/3 of older Americans out of poverty, and yes, that's a huge success. If you're one of those conservatives who thinks the elderly need to go back to living off cat food, again, I can't help you.
3. You're confusing investment risk with political risk--I was very careful to choose my terms but you obviously can't see the distinction. Again, I can't help you become smarter.
4. You're confusing Obama's myRAs with state autoIRA proposals, but these are two very different things. Also, you seem unaware that auto-IRA proposals would rely on private investment managers, so the state or federal governments involved would not handle the funds. Even if the government did handle the auto-IRA funds (which it won't), you also missed the post above about how government bonds as investments are backed by the full faith and credit of the US government and would take Congressional action to change--reading comprehension really doesn't seem to be your strong suit.

For the rest, yes I agree there will be restructuring. But even Trump doesn't think SS should go away completely. Trump has actually said that he wants to preserve Social Security in its present form, all of it. You're out of step with most of your conservative buddies. There's much more likelihood than you want to think that there will be a compromise that preserves a solid first tier benefit, and one that will help the poor in particular.

(And huh? You say I quoted both of your two posts, and so you're mad that I'm talking to you? Huh?)

PS, re #3, if you think Congress will stop funding Social Security to their constituents, you don't understand Congress. Social Security was the piece that led to resolution in the past several budget and debt ceiling crises. That's right, Congress acted only when the debt ceiling reached the point where it would be impossible to pay Social Security benefits. Congress is deathly scared that their constitutents' checks won't arrive on time.

Of course Congress won't stop funding SS. But that doesn't mean that SS will be funded forever. Eventually the capacity to continue borrowing will be exhausted.

The borrowing is temporary to cover the baby boomers. A permanent solution for the next generation does not require borrowing.

A permenant solution for the next generation does not require borrowing if the economic and demographic assumptions underlying such solution prove to be correct. The fundamental problem is that politicians are incentivized to choose the most optimistic assumptions possible in designing/modifying entitlement programs in order to keep the cost of those programs to a minimum (see Obamacare). Hence, entitlement programs tend to cost more than projected and deliver less benefit than promised because the best case projection rarely comes to fruition. Hence, SS needs an ever increasing amount of resources. The solution typically takes the form of significant tax increases every 10-15 years. This has been happening for 75 years and every single time people are convinced that government is enacting the permenant solution that will address solvency problems inherent to the program itself.

This is a fundamental problem of life itself. Every single project undertaken by every corporation, every job started by every individual, every car you ever bought was done based on assumptions that usually turn out too optimistic. There is just no way around this, except maybe we could let poor old people just starve to death unless some easily curable disease gets them first.

The specific problem of optimism bias in life is generally addressed by the fact that the decision-maker(s) evaluating assumptions bear the responsibility of those decisions. You are correct by implying that optimism bias gets people in trouble in everyday decisions. The difference is that in politics there is little or no consequence for bad decision making. E.g., Obamacare is imploding and the Student Loan program has morphed into a serious problem, but what does Obama care about any of that? He's done in about 6 months....

Would you really allow your mother to starve to death without shelter if SS wasn't in place? also, if this thing is really welfare to prevent old poor people from dying in the streets can we call it what it really is?

[Anonymous]

I would support raising the cap and reducing benefits are the very top of the income scale. Maybe the top 5%.
I also recognize the problem with raising the retirement age to 68, so can't support that even though I don't expect it to be a sacrifice for me (fingers crossed.) I do hope social scientists are doing more work to figure out a way to identify to differentiate the physical labor jobs from others. For example, if every job was deemed PL or not, and every quarter (or every time an employer submitted info on employees) the PL category were indicated, perhaps once someone had accrued so many quarters of PL, they would be eligible for full benefits at 65, or something like that.
Good news is that what's needed to fix SS is actually much 'easier' than what's needed to keep Medicare solvent for the long term!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think I would stop the ability to claim SS if you've never paid in.

Who gets SS if they don't pay in? I thought you had to have 40 quarters of earning, and the benefit is figured in your top 35 years.

DH grandma got SS for decades after her husband died. She never worked a job a day in her life. I'm certain she was not a citizen but drew a check for almost 50 years.

Another solution is to get rid of SS and let your parents move in with you. Wonder if obnoxious PP is down with that.