My idea to reduce poverty and eliminate social program spending.

[Chiropteran]

The problem is basically one thing: debt. In the natural world, such a concept doesn't exist. In *true* capitalism, debt wouldn't exist as it does, either. Debt only exists as it does because our government is directly subsidizing the banks and other lenders, by creating laws and courts and a whole legal framework that these lenders can use to profitably enslave those who fail to pay the debts in a timely manner.

In a natural market, if you lend an idiot $10,000 and he doesn't pay you back, you lose out. No government court system to bail you out and get you your money back eventually, no garnishing wages, no credit bureaus.

Remove the concept of debt and everything works out a lot better. No need to force savings.

 

[Kntx]

The basic guaranteed income idea was first pushed out into the arena of public debate by Milton Friedman. Its however relies on government removing all other forms of welfare and social spending along with a simplification of the tax code itself.

Then there are these other points to consider. First that 3000 US is not 3000 Swiss Francs as the cost of living in Switzerland is actually pretty high. Additionally they do tight controls on immigration and welfare handouts (i.e. you must be a citizen of that nation for 12 years to be eligible for social services), never mind a population demographic where only about 4% of the nation is not of European descent and a low birth rate.

Yep. It sounds pretty beautiful.

 

[Zaap]

Remove the concept of debt and everything works out a lot better.

Not really.

No such thing as debt, and you're walking to work (and everywhere) until you can afford that $10,000-$30,000+ in cash to buy a car. And you're pretty much NEVER owning any kind of real estate. Unless you manage to save up a few hundred grand, that is.

I would argue that debt actually works out pretty well, allowing people of average (and even very low) means to purchase the knowledge, inventions, expertise and experience of other's that they'd otherwise have zero access to. The real problem is; people don't know when to stop taking on debt for things they don't really need and the pendulum swings from otherwise unobtainable necessities, toward too many luxuries. (Or at the scale of national governments, rampant outright fraud).

 

[sandorski]

What's the difference between SS "theft" and forcing people to save 10% of their Income? To me it seems so close to the same thing as to not matter on that point.

Now opening that forced savings to certain exceptions is another can of worms. You will end up with millions retiring with nothing, some due to negligence, but many due to circumstances.

IMO, such a thing will cause Poverty to balloon.

 

[Mr. Pedantic]

The problem is basically one thing: debt. In the natural world, such a concept doesn't exist. In *true* capitalism, debt wouldn't exist as it does, either. Debt only exists as it does because our government is directly subsidizing the banks and other lenders, by creating laws and courts and a whole legal framework that these lenders can use to profitably enslave those who fail to pay the debts in a timely manner.

In a natural market, if you lend an idiot $10,000 and he doesn't pay you back, you lose out. No government court system to bail you out and get you your money back eventually, no garnishing wages, no credit bureaus.

Remove the concept of debt and everything works out a lot better. No need to force savings.

Debt literally makes the world go round. No debt means nobody would ever be able to buy a house or a car. Nobody would ever be able to start a company or develop a new product. Nobody would ever be able to find money for any kind of corporate-funded research. Nobody would be able to do anything at all.

 

[sandorski]

Debt literally makes the world go round. No debt means nobody would ever be able to buy a house or a car. Nobody would ever be able to start a company or develop a new product. Nobody would ever be able to find money for any kind of corporate-funded research. Nobody would be able to do anything at all.

Well said. However, Credit should be more difficult to get than it is now. Last night I watched the documentary Maxxed Out, assuming it is an accurate expose on the subject, it points out some serious flaws with the current system.

 

[Zaap]

If it isn't properly invested and able to beat inflation, forcing people to save 10% of their income wouldn't mean diddly anyway. It'd just be another ponzi scheme; either paid out in full in about four years -or if actually expected to be a proper retirement account, paid past those 4 years by current taxpayers. And without means testing, it'd be an incredible tax on the poor, and a boon for the wealthy.

Anyway, government already takes a lot more than 10% of most people's income. For it, you'll get the joy of zero return AND told your share of the perpetually increasing national debt.

Why do people think that a government that turns percentages of your income into mountains of "You Owe MEs" will magically start doing wonders with another 10%? That'd just get raided and spent into debt-oblivion too.

 

[DucatiMonster696]

Debt literally makes the world go round. No debt means nobody would ever be able to buy a house or a car. Nobody would ever be able to start a company or develop a new product. Nobody would ever be able to find money for any kind of corporate-funded research. Nobody would be able to do anything at all.

I'm not going to discount debt as a tool, but believing it is the only tool at the disposal of a nation is like believing that a hammer is the only tool for ANY job period. Savings is critical part of the equation that allows Debt to function without having the system not collapse in on itself.

 

[JMapleton]

I suspect that is what he meant (i.e. get sick and die). Otherwise, I can see your point.

I did mean that. Get sick and die.

 

[JMapleton]

getting sick is one thing, dying is another. OP said getting sick.

if i die in 5 minutes, as long as my wife does not remarry she can apply to get my SS benefits when she gets to 55.

Incorrect. She can just replace her own SS benefits with yours. She cannot combine yours with hers. So if she takes yours, her is getting stolen. Or visa versa. Either way, if you die, the money you paid in is gone.

 

[JMapleton]

Not really.

No such thing as debt, and you're walking to work (and everywhere) until you can afford that $10,000-$30,000+ in cash to buy a car. And you're pretty much NEVER owning any kind of real estate. Unless you manage to save up a few hundred grand, that is.

I would argue that debt actually works out pretty well, allowing people of average (and even very low) means to purchase the knowledge, inventions, expertise and experience of other's that they'd otherwise have zero access to. The real problem is; people don't know when to stop taking on debt for things they don't really need and the pendulum swings from otherwise unobtainable necessities, toward too many luxuries. (Or at the scale of national governments, rampant outright fraud).

Incorrect. You live in LA, where you must have several hundred grand to buy a house. These prices only exist because of debit and people's ability to borrow money.

In my city, you can buy a house for $75k in a safe neighborhood.

Take away the ability to borrow and housing prices will drop like a rock. Houses then become much more affordable.

But overall, I do not agree with taking away the ability to borrow money.

 

[JMapleton]

What's the difference between SS "theft" and forcing people to save 10% of their Income? To me it seems so close to the same thing as to not matter on that point.

What do you mean, what's the difference?!?!!?!?!

The difference is the government cannot take it away from you and your kids inherit it if you die. It's your money not just an IOU from Uncle Sam....the uncle that never plays fair.

This plan protects what you paid in...for the most part.

The next biggest obstacle is making sure the government doesn't eat away your savings through currency inflation.

 

[sandorski]

What do you mean, what's the difference?!?!!?!?!

The difference is the government cannot take it away from you and your kids inherit it if you die. It's your money not just an IOU from Uncle Sam....the uncle that never plays fair.

This plan protects what you paid in...for the most part.

The next biggest obstacle is making sure the government doesn't eat away your savings through currency inflation.

If you are legally bound to Save 10%, 10% has basically been taken away. SS works basically the same way, you receive $ back when you reach 65.

 

[Mr. Pedantic]

I'm not going to discount debt as a tool, but believing it is the only tool at the disposal of a nation is like believing that a hammer is the only tool for ANY job period. Savings is critical part of the equation that allows Debt to function without having the system not collapse in on itself.

Of course. But nobody said it was the only tool, and Chiro was the one who said that removing debt would make everything better.

 

[Chiropteran]

Debt literally makes the world go round. No debt means nobody would ever be able to buy a house or a car. Nobody would ever be able to start a company or develop a new product. Nobody would ever be able to find money for any kind of corporate-funded research. Nobody would be able to do anything at all.

In the 1820s:

Slavery literally makes the worlds go round. No slavery means nobody would be able to run a farm or plantation. Nobody would be able to profitably farm at all. The south would become a barren wasteland.

Debt is the easiest and laziest way to do a lot of things today. Taking it away would not end the world, it would just force people to be a little less lazy.

Things like cars and houses are partially propped up by debt, without easy access to debt people would buy what they actually needed instead of getting a $90k car as a status symbol. Homes would be used to live in rather than as investments.

Debt only enables the impossible if it is never paid off. If you pay your bills, you prove that you could have bought that *thing* that you bought on credit, simply by saving and buying it in a lump sum. This applies even to cars and houses.

 

[Zaap]

Incorrect. You live in LA, where you must have several hundred grand to buy a house. These prices only exist because of debit and people's ability to borrow money.

In my city, you can buy a house for $75k in a safe neighborhood.

75K isn't exactly pocket change. You're right though, the prices would drop dramatically, but it wouldn't matter much because the land itself is where the real value would be, and whoever stakes claim first wins. Whatever hut they erect beyond that wouldn't matter much.

And as already been mentioned, much of society wouldn't function the same without debt (borrowing to develop new products which in turn create industry and jobs and so on) so we'd basically have a more simplistic bartering society, few luxuries, and far fewer career type jobs as opposed to mere 'eek out survival' type occupations. In some ways it might be loosely defined as better, but in many ways it'd be considerably worse, and most average people would be wretchedly poor.

Basically, go visit your average third world shithole and you'll get a rough approximation.

 

[Zaap]

If you pay your bills, you prove that you could have bought that *thing* that you bought on credit, simply by saving and buying it in a lump sum. This applies even to cars and houses.

If only things were so simplistic. There wouldn't be cars and houses in the same form without debt. (Or decent incomes for that matter). No one builds industries around things most people can't afford, or have to save for 10 years to be able to afford.

 

[Chiropteran]

If only things were so simplistic. There wouldn't be cars and houses in the same form without debt. (Or decent incomes for that matter). No one builds industries around things most people can't afford, or have to save for 10 years to be able to afford.

Everyone who owns a car could afford to pay cash for a car- EVERY SINGLE PERSON. They would just have to ride the bus or carpool for a couple years while they save up $300/month, and pay cash for the car.

The only people who couldn't save to buy a car for full price are the same people who can't pay their car payments and don't have the credit to buy a car in the current system. No real net change there.

 

[JMapleton]

If you are legally bound to Save 10%, 10% has basically been taken away. SS works basically the same way, you receive $ back when you reach 65.

What if you don't reach 65? Then your money is gone.

Quit trolling. My plan doesn't "take it away," it forces you to save it. It's there though, you can see it in an account. Your kids will inherit it. You can spend it how you want when you retire.

 

[Zaap]

Everyone who owns a car could afford to pay cash for a car- EVERY SINGLE PERSON. They would just have to ride the bus or carpool for a couple years while they save up $300/month, and pay cash for the car.

You missed the fact that without debt, there is no affordable car to buy. Who would have invented/manufactured it without investment capitol? What would make it affordable to the masses? If invented at all, it would have remained a plaything of the extremely wealthy only.

Heck, inventing things that could be mass produced would only be an extremely wealthy person's game.

Like I said before, the problem with your premise is it's easily disproven by both history and current conditions in much of the world with no access to capital or credit. It's basically serfdom/indentured servitude where those with the land and hard assets control literally *everything* and everyone else has nothing, with little way to improve their lot.

Few land owners would wait for you to 'save up' the means to buy a piece of their land (let alone build a nice cozy house on it for you) they'll simply make you a serf and have you work your ass off just for the 'privilege' of working their land for them.

And people think they have a lot to bitch about how bad they have it now? Complete serfdom would be infinitely worse.

 

[sandorski]

What if you don't reach 65? Then your money is gone.

Quit trolling. My plan doesn't "take it away," it forces you to save it. It's there though, you can see it in an account. Your kids will inherit it. You can spend it how you want when you retire.

SS can be spent anyway one wants. It also forces you to pay $ towrds your Retirement. It has the added bonus, compared to your suggestion, of preventing the person from having to Spend it.

 

[Tom]

One of the biggest problems in the United States is our lack of ability to save.


Currently the system we know called "Social Security" is a scam. People pay into it all their life and if they get sick one day when their 60 years old, all that money they paid is gone.

You don't understand what Social Security is. You don't lose it if you get sick when you're 60.

And it's not a scam. Its the safest pension plan in history.

 

[JMapleton]

You don't understand what Social Security is. You don't lose it if you get sick when you're 60.

And it's not a scam. Its the safest pension plan in history.

You lose it if you die. Your family loses all the money you paid in your whole life.

It's a scam. Pay in your whole life. Die when you're 60. It's all gone.

 

[JMapleton]

SS can be spent anyway one wants. It also forces you to pay $ towrds your Retirement. It has the added bonus, compared to your suggestion, of preventing the person from having to Spend it.

But if you die when you're 60, it's all gone.

What about this do you not understand?

 

[Conscript]

Here's an idea, don't have government do anything. After generations of people die destitute, and realize that they are actually responsible for themselves, people will get the concept. But keep doing things for them, what's the incentive not to spend it all while they're young, if someone else is just going to pick up the tab down the road?