My idea to reduce poverty and eliminate social program spending.

[JMapleton]

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?

Sounds nice on paper, but this is a democracy. And the public will vote in government officials that will not support that. Believe it or not, the average citizen (both GOP and Dem) out there wants the government to control their lives in some way or another. Will never happen.

 

[IronWing]

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.

It's not a scam. People just think about it incorrectly. SS is not a retirement account, it really is an insurance scheme. Like any other insurance scheme, there is a presumption built into the SS tax rates that some folks will die w/o collecting, lowering the overall payout. If you pay for car insurance for forty years and never have an accident was car insurance a scam?

 

[Conscript]

It's not a scam. People just think about it incorrectly. SS is not a retirement account, it really is an insurance scheme. Like any other insurance scheme, there is a presumption built into the SS tax rates that some folks will die w/o collecting, lowering the overall payout. If you pay for car insurance for forty years and never have an accident was car insurance a scam?

there is unfortunately a fatal miscalculation that was made with the inception of the SS system, that makes it mathematically unsustainable. And that was the presumption that the US taxpaying population will forever increase, and increase at a rate faster than the average life expectancy increases. Unfortunately the people paying into it is decreasing as the average family size has decreased, while the people taking out are increasing as medicine and care increases. And this is the exact reason pyramid schemes ultimately fail.

 

[Chiropteran]

You missed the fact that without debt, there is no affordable car to buy.

I missed it because it isn't a fact. It's merely a product of your imagination.

Technology doesn't require debt. You can do all the hand-waving you want, but you can't actually prove it because it's not true.

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

Are you living in the same world as me? This is already the case. Go ahead, "invent" your awesome improved car and build them. Since debt exists, it's easy, right?

No.

Debt doesn't actually enable what you think it enables. Banks don't lend billions to penniless inventors, even if they have an amazing idea. How it actually works is the inventor needs to find an investor. Notice that investing is not the same as lending, and doesn't have to involve debt in any traditional way.

A removal of debt does not equal a removal of the possibility to invest, or sell stock, or share ownership. The ideas are completely unrelated, and your straw man attempt to claim that removing debt would make investment impossible is rather pathetic.

 

[IronWing]

there is unfortunately a fatal miscalculation that was made with the inception of the SS system, that makes it mathematically unsustainable. And that was the presumption that the US taxpaying population will forever increase, and increase at a rate faster than the average life expectancy increases. Unfortunately the people paying into it is decreasing as the average family size has decreased, while the people taking out are increasing as medicine and care increases. And this is the exact reason pyramid schemes ultimately fail.

There was an article on the imbalance facing the SS program between tax collections and expected payouts. The author pointed out that larger than demographic shifts, which are important, is the profound shift in the distribution of income in the U.S. economy. In the early decades of the SS program, a far higher percentage of GDP went to workers' wages, and therefore subject to SS tax, than has been the case since the 1970s. The author claimed that if current workers enjoyed the same percentage of GDP as workers did in previous generations that the SS program would be solvent despite the demographic changes you've mentioned above. I'll have to go digging for the article.

 

[Zaap]

I missed it because it isn't a fact. It's merely a product of your imagination.

Says a guy who clearly has never cracked a history book, or taken a look around the world outside.

Technology doesn't require debt. You can do all the hand-waving you want, but you can't actually prove it because it's not true.

You have a severely limited understanding of the way the real world works, so there's not a whole lot of point in entertaining your notions.

Are you living in the same world as me?

No, and quite frankly, no one else does either. You're in some fantasy world of your own, but there's this thing outside called the REAL WORLD. You fantasize that people will just create things for you out of thin air without any consideration for the debt involved in invention, research, labor, materials and a thousand other things you have no clue about, and then after performing this magic, wait idly twiddling their thumbs until you're able to afford the fruits of their efforts. In the real world, nothing actually works this way.

Like I said, everything you're thinking is so great has already come to pass, or still exists today in various places you wouldn't actually want to set foot in, but you'd actually have to know more than just some half-baked fantasy of "no such thing as debt=panacea" to actually know any of that.

 

[Zaap]

while the people taking out are increasing as medicine and care increases.

Not to worry, this won't be the case for too much longer. "Just take a pill."

 

[Chiropteran]

Zaap, do you have any references whatsoever? Do you have any credentials that support your ideas? Do you have any way to prove to me that you aren't just an angry kid sitting in a basement? I suspect the answer is no, but I'm asking just the same.

The option to borrow is a convenience, and can speed up the process, and may even be required in a competitive market where all your competitors are also borrowing. In the same way, slavery is a convenience, and makes farming more easily profitable, and may even be required to compete if all your competitors use slavery.

However, anyone can do the math. It's not hard to realize that mathematically, there is virtually zero difference between a company working with a 10 billion investment vs the exact same company working with a 10 billion credit limit. There is nothing about debt that makes it required or even beneficial given the potential to obtain the funds in other ways.

>In the real world, nothing actually works this way.

You are wrong. Debt is an option. It's a way to gamble risk for profit. For every company that borrows money to start-up and succeeds, there are dozens that fail and go into bankruptcy. You on some sort of of delusion that every major corporation is running around on billions of unsecured debt when that just doesn't happen. Banks lend money in a profitable way.

A company with proven success can get credit. Some new fool off the street with an idea? Not so much. What you can get is based on your personal credit and/or whatever can be secured based on what you are willing to use as collateral, such as a house.

> You fantasize that people will just create things for you out of thin air

Nope, not sure why you insist on putting words in my mouth, I said no such thing.

Apparently YOU fantasize that banks will lend you millions to turn your idea into reality though, with no basis on actual profit made. Sorry, your sense of reality is badly damaged. A new idea that requires a lot of money isn't going to do a damn thing based on debt alone. You aren't going to get a million dollar loan, sorry. You will raise the money through investors or other forms of fund raising.

Banks aren't stupid, they don't lend you more than you are generally worth or can be expected to pay back, eventually, even at min wage. That is why it's easy for any idiot to get a credit card with a few hundred dollars limit, maybe even a thousand. That doesn't mean the same idiot could get the funding needed to turn an idea into a product. You are completely deluded if you think that is how things work.

Debt exists as a way for the bank to make money, nothing more. If you think it's some amazing wonderful thing that pushes innovation and allows technology to exist, you are just a sheep repeating exactly what the bankers want you to repeat.

 

[Zaap]

just an angry kid sitting in a basement

Pretty much your autobiography. I thought so.

The option to borrow is a convenience, and can speed up the process, and may even be required in a competitive market where all your competitors are also borrowing.

Back-peddal.

In the same way, slavery is a convenience, and makes farming more easily profitable, and may even be required to compete if all your competitors use slavery.

Dumb analogy. Nothing about slavery is actually cheap, and (beyond being morally reprehensible) it's actually a terrible economic system. Hence: the north without slavery was wealthier, better developed, and more stable than the south that had it. But again, you've never cracked a history book so you wouldn't realize that.

It's not hard to realize that mathematically, there is virtually zero difference between a company working with a 10 billion investment vs the exact same company working with a 10 billion credit limit.

LOL! According to you, all any business has to do is simply wait until they earn 10 billion dollars out of thin air.

Anyway, you're beyond silly and I suspect even you realize it and are just pulling crap out of your ass at this point. You're much like a person who comes up with simplistic 'ideas' like: "Poor people are poor because they don't have money! So if we eliminate money... there's no more poor people!"

When confronted with all the ways that's completely idiotic, and hardly a new idea, you'll bang away perpetually insisting that it's brilliant, makes total sense, and if only everyone would just implement your wonderful idea.

Lending and debt isn't in any way the bogeyman you make it out to be- it's merely a shortcut for transferring future earning power into the here and now where it's of immediate use, rather than an inefficient system of bartering with hard assets as you think would be wonderful. There's nothing particularly wrong with debt- it's actually a very good method of getting things done. The problems arise simply when it's abused. (Which is really another whole topic.) Your simplistic thinking otherwise doesn't really change any of that.

 

[StrangerGuy]

lol @ OP. While there is no doubt many people are irresponsible at their money you really think forcing everyone to save 10% of their income will somehow solve the fundamental issue of most people not earning enough money to begin with.

 

[JMapleton]

It's not a scam. People just think about it incorrectly. SS is not a retirement account, it really is an insurance scheme. Like any other insurance scheme, there is a presumption built into the SS tax rates that some folks will die w/o collecting, lowering the overall payout. If you pay for car insurance for forty years and never have an accident was car insurance a scam?

"Scam" is relevant. In my opinion, it's a scam. When you could be saving your own money instead of giving it to the government hoping one day you'll get it back without severely reducing your benefits.

My plan is far superior.

 

[OverVolt]

Zaap is definitely a bit "you damn kids get off my lawn and get jobs ya good for nothing crybabies" type without realizing the implications of say

In the early decades of the SS program, a far higher percentage of GDP went to workers' wages, and therefore subject to SS tax, than has been the case since the 1970s. The author claimed that if current workers enjoyed the same percentage of GDP as workers did in previous generations that the SS program would be solvent despite the demographic changes you've mentioned above.

As a 20 year old in 2013 trying to actually build up your wealth like they did in the 70's and realizing it just isn't going to happen like it happened for them and they turn around and go like "we had it so much harder you kids have all these blueberries and smartdruids your lives are so much easier" cause everyone knows true fulfillment in life is having a smart phone not a safe retirement.

 

[StrangerGuy]

Zaap is definitely a bit "you damn kids get off my lawn and get jobs ya good for nothing crybabies" type without realizing the implications of say As a 20 year old in 2013 trying to actually build up your wealth like they did in the 70's and realizing it just isn't going to happen like it happened for them and they turn around and go like "we had it so much harder you kids have all these blueberries and smartdruids your lives are so much easier" cause everyone knows true fulfillment in life is having a smart phone not a safe retirement.

Yup, now "first world" is defined by living off food stamps, one medical bill from permanent ruin and electronics which is practically the only major category of stuff that become cheaper.

Economic victim blaming is just so hilarious.

 

[Imran520]

Thanks for sharing. It is very good idea & it will bring change.

 

[Smoblikat]

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

The average US citizen lives paycheck to paycheck and lacks financial management skills. Because of this, the Federal Government has had to create numerous programs to assist people in times they should have been able to assist themselves. Examples are Social Security, Food Stamps, Medicaid, unemployment benefits, and numerous other benefits.

I plan to fix the majority of these with one simple program.

Forced savings.

For every citizen, create a government issued savings account that would eventually replace paying into FICA, which is nothing but a scam to rob citizens of their hard earned money.

The goal would be to force every US citizen to put 10% of their earnings into this savings account, which they cannot take money out of, with certain exceptions.

Exceptions would be:
Short term unemployment - this would replace unemployment benefits and save companies money, which would promote hiring.

Down payment on a house - I would allow a certain portion of your government savings to be used as a down payment on a house, as long as it meets a certain house/income ratio, so people don't buy too big of a house. This would encourage home ownership without the pitfalls of 0 down loans which led to the housing crash. Basically making it irresistible to purchase a house below your means because people would view "unlocking" their government savings and spending it as free money.

Welfare and other assistance programs - Most people work sometime in their life, even for the chronically unemployed, this would take some of the burden off of the federal and state governments to fund welfare programs for a while.

Healthcare - The uninsured would pay their own pay as far as their savings would take them, so the burden would be rely on others.

Retirement - Once you hit retirement age the money is yours to spend, unlocked.

This money would not be allowed to be invested in anything except US Government Bonds.

Why not? Combined, these savings accounts would create trillions in savings over the years and flood trillions of dollars into the stock and bond markets would create a liquidity bubble and artificially inflate stock prices. Yes, there is such thing as too much money in the stock market.

This idea would eliminate most poverty and not allow the government to steal people's savings.

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.

Under my system, people would be allowed to pass their leftover savings onto their kids or charities by inheritance. This would create generations of "locked up" wealth and eliminate poverty over the long run. Maybe allow people a cap on their savings account and once they hit the cap they no longer have to contribute, they can keep their full paycheck. Or allow people, say, 50% of their inherited "government savings" from their parents to be money they can do whatever with and the rest is forced into their government savings.

This is just a very rough draft, but you guys get my idea.

Force people to do what they should have been doing to begin with.

Phase out these scam systems like Social Security and other programs and allow people to build something they own.

Your idea to prevent the government from stealing savings, is to FORCE people to take 10% of the money they work hard to earn, and put it in a government owned bank account with extremely restricted access to it?

That sounds like theft to me..........

 

[JMapleton]

Your idea to prevent the government from stealing savings, is to FORCE people to take 10% of the money they work hard to earn, and put it in a government owned bank account with extremely restricted access to it?

That sounds like theft to me..........

Yet I hear no complaints about Social Security, which is 10 times worse.

 

[Spungo]

This thread is mind boggling. People are honestly arguing against a government enforced defined-contribution pension in favor of a defined-benefit pension. Can anyone guess why corporations are moving away from defined-benefit pensions? BECAUSE THEY ARE NOT SUSTAINABLE.

 

[nextJin]

Bring back home economics in high school.

Pretty much this, since the government is so hell bent on micromanaging all schools might as well force High School kids to pass a course in this or not graduate.

No comment on forced legislation to better peoples lives when it never works out that way.

 

[AViking]

Economics was required for graduation. Did they change that?

Wanna balance the budget and reduce poverty real easy? Stop spending so much money on the military. Invest that money into education, research, and other future oriented programs. We have $689,000,000,000 to work with here.

Get rid of social security. It does not work. Just end it. It's ridiculous to have a program in place that at retirement will pay you almost nothing and leave you at the poverty level if you try to rely on it. The average benefit is $1180. So stupid. We have $773,000,000,000 to work with here.

Just addressing those two elephants in the room adds up to $1,462,000,000,000

 

[Mr. Pedantic]

Economics was required for graduation. Did they change that?

Yes.

Wanna balance the budget and reduce poverty real easy? Stop spending so much money on the military. Invest that money into education, research, and other future oriented programs. We have $689,000,000,000 to work with here.

Get rid of social security. It does not work. Just end it. It's ridiculous to have a program in place that at retirement will pay you almost nothing and leave you at the poverty level if you try to rely on it. The average benefit is $1180. So stupid. We have $773,000,000,000 to work with here.

Just addressing those two elephants in the room adds up to $1,462,000,000,000

Both are political suicide. Both parties would have a field day if anyone seriously proposed what you've just proposed.

 

[boomerang]

Wanna balance the budget and reduce poverty real easy? Stop spending so much money on the military. Invest that money into education, research, and other future oriented programs. We have $689,000,000,000 to work with here.

Get rid of social security. It does not work. Just end it. It's ridiculous to have a program in place that at retirement will pay you almost nothing and leave you at the poverty level if you try to rely on it. The average benefit is $1180. So stupid. We have $773,000,000,000 to work with here.

Just addressing those two elephants in the room adds up to $1,462,000,000,000

Wow. Do you live anywhere near the ocean? I ask because I have this theory that salty ocean air affects people's brains.

 

[child of wonder]

Yet I hear no complaints about Social Security, which is 10 times worse.

I'd rather not participate in it. That's money I could invest on my own for retirement rather than it going to my good for nothing sister in law who barely worked her whole life but now collects SSI, my mother in law who refuses to work so got on SSI after 5 attempts, etc.

I just maxxed out my SS tax for the year so it's pretty nice having a 6.2% tax break until 2014.

 

[Chiropteran]

The option to borrow is a convenience, and can speed up the process, and may even be required in a competitive market where all your competitors are also borrowing.

Back-peddal.

Uh, lets go back to my first response to you:

Debt is the easiest and laziest way to do a lot of things today.

It's not back-peddling when you repeat the same concept. Are you really so inept at debate that you have to lie and misuse terms?

you've never cracked a history book so you wouldn't realize that.

Oh look, another unfounded lie from Zaap. Please, keep telling me these facts about myself you seem to know. I find it all very interesting. Do you think that these lies and insults make your argument more persuasive? You sound like a raving madman. You don't know me, how could you possibly have any idea of my education? You don't. You are just speaking out of your ass, which has been par for the course of this entire thread.

According to you, all any business has to do is simply wait until they earn 10 billion dollars out of thin air.

Ah, finally something that vaguely resembles a rational argument. Bravo, Zaap.

Your problem is that you have no imagination, you can't understand a world that works in any way other than the way the current world works.

Prices are set by supply and demand. A world where everyone has $5000 is economically identical to a world where everyone has $2500 and a $2500 credit limit. The only difference is that when you are using credit, some "small" fees are going to feed the banks.

You seem to think that debt magically makes more money. Well, it does, but the value of money is based on supply and demand, like anything else. Double the money supply and you cause inflation, which makes that money half as valuable. So your $2500 becomes $5000 when you can borrow $2500 in credit, except your new $5000 buys the same amount of stuff as your old $2500 did. Do you disagree? Do you think money can be printed at will without causing inflation or other negative consequences? If so, you are very naive.

I suspect you probably do poorly in math if you are still having trouble. Math has always been an interesting subject to me, and money and debt is just the manipulation of numbers. As the math works out, a world where everyone can borrow up to $10,000 in credit is IDENTICAL to a world where everyone receives $10,000 cash when born, except one minor difference- with a credit/debt system, the banks get to walk away with free profit from the interest.

Basically debt just shifts the value so that "0" actually means you have X available assets, where X is your credit limit. It doesn't allow the impossible, anything you can do with debt can be done the exact same in a debt-free system, just by shifting the numbers around.

 

[Jhhnn]

This thread is mind boggling. People are honestly arguing against a government enforced defined-contribution pension in favor of a defined-benefit pension. Can anyone guess why corporations are moving away from defined-benefit pensions? BECAUSE THEY ARE NOT SUSTAINABLE.

Uhh, no. They're moving away from pensions to avoid responsibility & reduce costs.

Sustainability is not & never was more than a smokescreen for load shifting onto working people whose share of national income is constantly shrinking.

 

[bignateyk]

They already have forced savings. It's called taxes.