noob social security question -

[SuperTool]

The point is Americans don't trust republicans with Social Security. They are too eager to break it, but are pretty short on ideas on how to improve it.
If Bush wants to submit a specific plan that can be scrutinized and evaluated, that's one thing. Instead he is just trashing the current system, while not really coming up with anything of substance to replace it with.

 

[dmcowen674]

Originally posted by: LordSnailz
I did a search and read most of the threads already but can someone explain in 2-3 sentences why Bush's plan is bad?

From what I understand you take percentage of what they tax you and use it to invest it yourself. What's wrong with that plan? I understand it won't fix the problem but isn't it in the right direction?

Not trying to start a flame war here just a simple answer. TIA!

I could do it in less than 2 or 3 sentences, Stock Market, nuff said.

 

[charrison]

Originally posted by: Darkhawk28
If a plan could be put together that would

A) Solve the solvency problem (Bush's plan does NOT solve this, even to his own admission)

It does solve long term solvency problems. 2 trillion in new debt today, is better than 10 trillion in debt later on. The sooner the problem is looked the better off we will all be.



B) Allow me to choose the stock I want and move them around as much as I want.


Yet you want to keep expenses at a minimum and safety at a maximum...
You cant have both.

The federal thrift saving plan allows you to make changes once a year and has very low costs.


C) Have a built in loss insurance of some measure (like an FDIC of sorts).

Built in portfolio balancing would probably solved most of this problem. Someone a few years from retirement does not need to 100% stock fund holding.


D) Not borrow trillions of dollars further indebting our nation and destabalizing our economy.


I am all for responsable spending in DC, but we are no where near record debt:gdp ratio or a destabilized economy


E) Would NOT reduce guaranteed benefits.

No plan has been offered that would reduced guaranteed benefits.


Then, yes, I'd be open to it, sure.

 

[charrison]

Originally posted by: Darkhawk28
His plan would cost us trillions in additional national debt.

Would reduce guaranteed benefits.

Is a stretch because the CBO (Congressional Budget Office) and the SS Trustees both say that the system is 100% solvent until 2042 and 73%-80% solvent indefinitely.

Broker fees and the shaving of the first 3% of your earning above and beyond what SS normally earns is taken.


That's just a start.

There is no 3% clawback. What goes into private account would be yours.

I'd rather lose with truth than win with lies.

You really should start doing your homework, because you are falling for anti-SS reform lies.

 

[BaliBabyDoc]

The rub is that Bush started his "sales pitch" proclaiming SS needed reform true and private accounts were the answer false. When made to account for the disconnect, Bush gradually retreated to say he was merely "opening the dialogue" and "all options are on the table." But he didn't want to give Congress a plan b/c Congress needed to hash out the details.

A great big lie considering Bush League wonks have been working out the details for some time. The problem is that sustainability in SS requires signficant changes that would smack virtually every constituency (raise retirement age, lower benefits for future retirees, lower COLA for current retireees, raise FICA cap and/or FICA rate).

Even Karl couldn't sell that swill, so they settled on the "ownership society" smokescreen. Bush would take credit for "liberating" the taxpayers hard earned money from a spendthrift Congress, while legislators would take the fall for proposing painful reforms AND busting the budget by borrowing to fund the accounts.

It might have worked except a few Democrats found their gonads, a few Republicans decided they wouldn't take the fall (plus the Bush "plan" was stupid), and most importantly the general public likes SS. They might support some cosmetic surgery (tummy tuck, lip collagen, etc but Bush is trying to sell a transplant with no anesthesia.

 

[Darkhawk28]

Originally posted by: charrison

Originally posted by: Darkhawk28
His plan would cost us trillions in additional national debt.

Would reduce guaranteed benefits.

Is a stretch because the CBO (Congressional Budget Office) and the SS Trustees both say that the system is 100% solvent until 2042 and 73%-80% solvent indefinitely.

Broker fees and the shaving of the first 3% of your earning above and beyond what SS normally earns is taken.


That's just a start.

There is no 3% clawback. What goes into private account would be yours.

I'd rather lose with truth than win with lies.

You really should start doing your homework, because you are falling for anti-SS reform lies.

I guess the CBO are liars. BTW, the CBO are mostly REPUBLICANS.

BTW, I've offered REAL statistics, facts and figures. Your side has offered nothing but Bush's BS rhetoric.

 

[Jhhnn]

The whole point of the "Save SS" rhetoric is to bolster public opinion in the "SS won't be there for ME" direction in a way that leads away from the reasons that just might end up being true... half a trillion dollar a year deficits, and going nowhere but up.

There's only one way to save SS, and our descendants' fiscal future, which is to create a budget surplus, pay down the debt in preparation for that 2018 crossover. If we're paying down debt, then we'll be in the proper position to pay back SS when the time comes.

But that's not "on the table", is it? Without that, the whole thing is pure deception, doublespeak of the highest order, and a smokescreen for the greatest financial scam ever undertaken, one that will rip the guts out of the American middle class...

 

[charrison]

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
His plan would cost us trillions in additional national debt.

Would reduce guaranteed benefits.

Is a stretch because the CBO (Congressional Budget Office) and the SS Trustees both say that the system is 100% solvent until 2042 and 73%-80% solvent indefinitely.

Broker fees and the shaving of the first 3% of your earning above and beyond what SS normally earns is taken.


That's just a start.

There is no 3% clawback. What goes into private account would be yours.

I'd rather lose with truth than win with lies.

You really should start doing your homework, because you are falling for anti-SS reform lies.

I guess the CBO are liars. BTW, the CBO are mostly REPUBLICANS.

BTW, I've offered REAL statistics, facts and figures. Your side has offered nothing but Bush's BS rhetoric.

The 3% clawback you are referring came from an op ed report that was later retracted because it was misreported, not the cbo.

You are right that cbo is reporting that SS is 75% solvent until 2042, however the part you are leaving out is that it would require a payroll tax of over 25%(for ss and medicare) to repay the trust fund.

While you may not mind saddling your kids with such taxation to fund your retirement, I do have problems with it.

 

[Jhhnn]

From charrison-

"While you may not mind saddling your kids with such taxation to fund your retirement, I do have problems with it. "

Apparently, however, you have no problem adding interest charges to those same expenses, which is precisely what borrowing now to privatize SS will actually accomplish.

You're also misrepresenting the projections rather egregiously- The CBO projects 75% solvency after 2042, not before, and 100% solvency up to that date, provided that the general fund obligations to the trust are honored, which BushCo apparently has no intention whatsoever of actually allowing...

 

[charrison]

Originally posted by: Jhhnn
From charrison-

"While you may not mind saddling your kids with such taxation to fund your retirement, I do have problems with it. "

Apparently, however, you have no problem adding interest charges to those same expenses, which is precisely what borrowing now to privatize SS will actually accomplish.

You're also misrepresenting the projections rather egregiously- The CBO projects 75% solvency after 2042, not before, and 100% solvency up to that date, provided that the general fund obligations to the trust are honored, which BushCo apparently has no intention whatsoever of actually allowing...

That would be incorrect. SS starts to take in less than it pays out in 2018, so either taxes must go up or benefits must go down starting then.

Yes it will cost money to transition to private accounts, but in the long run we will be tradiing a larger debt in the future for a smaller one now. The longer we wait, the worse the problem become as the number of workers continues to shrink against the number of retirees.

 

[Darkhawk28]

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
His plan would cost us trillions in additional national debt.

Would reduce guaranteed benefits.

Is a stretch because the CBO (Congressional Budget Office) and the SS Trustees both say that the system is 100% solvent until 2042 and 73%-80% solvent indefinitely.

Broker fees and the shaving of the first 3% of your earning above and beyond what SS normally earns is taken.


That's just a start.

There is no 3% clawback. What goes into private account would be yours.

I'd rather lose with truth than win with lies.

You really should start doing your homework, because you are falling for anti-SS reform lies.

I guess the CBO are liars. BTW, the CBO are mostly REPUBLICANS.

BTW, I've offered REAL statistics, facts and figures. Your side has offered nothing but Bush's BS rhetoric.

The 3% clawback you are referring came from an op ed report that was later retracted because it was misreported, not the cbo.

You are right that cbo is reporting that SS is 75% solvent until 2042, however the part you are leaving out is that it would require a payroll tax of over 25%(for ss and medicare) to repay the trust fund.

While you may not mind saddling your kids with such taxation to fund your retirement, I do have problems with it.

NO. SS is 100% solvent until 2042, not 75%.

 

[charrison]

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
His plan would cost us trillions in additional national debt.

Would reduce guaranteed benefits.

Is a stretch because the CBO (Congressional Budget Office) and the SS Trustees both say that the system is 100% solvent until 2042 and 73%-80% solvent indefinitely.

Broker fees and the shaving of the first 3% of your earning above and beyond what SS normally earns is taken.


That's just a start.

There is no 3% clawback. What goes into private account would be yours.

I'd rather lose with truth than win with lies.

You really should start doing your homework, because you are falling for anti-SS reform lies.

I guess the CBO are liars. BTW, the CBO are mostly REPUBLICANS.

BTW, I've offered REAL statistics, facts and figures. Your side has offered nothing but Bush's BS rhetoric.

The 3% clawback you are referring came from an op ed report that was later retracted because it was misreported, not the cbo.

You are right that cbo is reporting that SS is 75% solvent until 2042, however the part you are leaving out is that it would require a payroll tax of over 25%(for ss and medicare) to repay the trust fund.

While you may not mind saddling your kids with such taxation to fund your retirement, I do have problems with it.

NO. SS is 100% solvent until 2042, not 75%.

So just answer this question then..

IF SS is 100% solvent after 2018 when SS starts to take in less than it pays out, what will the difference be paid out with?

Simple question.....

Will the goverment print money?
Raise taxes?
or cut benefits?


It has to do at least 1 of the 3....

 

[Darkhawk28]

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
His plan would cost us trillions in additional national debt.

Would reduce guaranteed benefits.

Is a stretch because the CBO (Congressional Budget Office) and the SS Trustees both say that the system is 100% solvent until 2042 and 73%-80% solvent indefinitely.

Broker fees and the shaving of the first 3% of your earning above and beyond what SS normally earns is taken.


That's just a start.

There is no 3% clawback. What goes into private account would be yours.

I'd rather lose with truth than win with lies.

You really should start doing your homework, because you are falling for anti-SS reform lies.

I guess the CBO are liars. BTW, the CBO are mostly REPUBLICANS.

BTW, I've offered REAL statistics, facts and figures. Your side has offered nothing but Bush's BS rhetoric.

The 3% clawback you are referring came from an op ed report that was later retracted because it was misreported, not the cbo.

You are right that cbo is reporting that SS is 75% solvent until 2042, however the part you are leaving out is that it would require a payroll tax of over 25%(for ss and medicare) to repay the trust fund.

While you may not mind saddling your kids with such taxation to fund your retirement, I do have problems with it.

NO. SS is 100% solvent until 2042, not 75%.

So just answer this question then..

IF SS is 100% solvent after 2018 when SS starts to take in less than it pays out, what will the difference be paid out with?

Simple question.....

Will the goverment print money?
Raise taxes?
or cut benefits?


It has to do at least 1 of the 3....

Sorry, but you're wrong... with no changes at all, SS can pay 100% benefits until 2042 and about 75% thereafter.

Charrison, I wouldn't mind a "private" plan so much if it was well thought out and didn't threaten the system. The facts just don't follow Bush's plan.

From the second link I provided above

How long will Social Security be able to pay 100% of scheduled benefits?

Social Security has two dedicated trust funds?one for the Old Age and Survivor Insurance programs (OASI) and another for the Disability Insurance program (DI). Until 1983, Social Security operated on a pay-as-you-go basis (that is, no surpluses existed because all taxes paid into the system were immediately used to pay benefits). A 1983 bipartisan agreement revised the program so that it would generate surpluses for several decades to build up a trust fund because outlays were expected to increase substantially as the baby-boomer generation begins retiring and Americans continue to live longer. The trust fund balance is at $1.5 trillion and is currently running a surplus, with 74% of the money collected paid out as benefits. The remaining money goes into the Social Security trust funds and is invested in government bonds.

The Social Security Board of Trustees?which includes the Secretaries of Treasury, Labor, and Health and Human Services?is responsible for reporting the current and projected financial condition of the Social Security program each year. According to the trustees' "intermediate" scenario, the Social Security trust fund currently has enough money to pay 100% of scheduled benefits for the next 37 years, until 2042. (Social Security Trustees, The 2004 Annual Report of the Board of Trustees, March 23, 2004). Assuming there are no changes to the Social Security system?no tax increases and no benefit cuts?there will not be a shortfall for about four decades. Under the trustees' projections, when the trust fund runs out of money in 2042, the payroll taxes coming in would still be sufficient to pay retirees about 73% of their scheduled benefits. Importantly, those benefits would still be much higher in real (inflation-adjusted) terms than what retirees are being paid today. (Josh Bivens of EPI, Privatization fix for Social Security is worse than doing nothing, January 26, 2005). Under the trustees' more optimistic ("low-cost") scenario, there's no shortfall at all: the trust fund balance is projected to be $17.9 trillion in 2080.

The trustees estimate that in 2018 the cost of current benefits will exceed payroll tax collections. Because the trust fund is projected to reach $3.7 trillion (in 2004 dollars)in 2018 (more than twice the 2005 opening balance of $1.7 trillion), the Social Security system will be far from "bankrupt" in 2018. Instead, interest on U.S. Treasury bonds in the Social Security trust fund will be used to help pay benefits. (Jason Furman, Does Social Security Face a Crisis in 2018?, January 2005).

The nonpartisan Congressional Budget Office (CBO), which adopts a less pessimistic set of economic assumptions than the trustees' intermediate scenario, projects that the Social Security trust fund has enough money to pay all scheduled benefits for the next 47 years, until 2052 (Congressional Budget Office, The Outlook for Social Security, June 2004). Under the CBO's updated projections, when the trust fund runs out of money in 2052, the payroll taxes coming in will still be sufficient to pay retirees about 78% of scheduled benefits (Congressional Budget Office, Updated Long-term Projections for Social Security, January 2005).

 

[charrison]

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
His plan would cost us trillions in additional national debt.

Would reduce guaranteed benefits.

Is a stretch because the CBO (Congressional Budget Office) and the SS Trustees both say that the system is 100% solvent until 2042 and 73%-80% solvent indefinitely.

Broker fees and the shaving of the first 3% of your earning above and beyond what SS normally earns is taken.


That's just a start.

There is no 3% clawback. What goes into private account would be yours.

I'd rather lose with truth than win with lies.

You really should start doing your homework, because you are falling for anti-SS reform lies.

I guess the CBO are liars. BTW, the CBO are mostly REPUBLICANS.

BTW, I've offered REAL statistics, facts and figures. Your side has offered nothing but Bush's BS rhetoric.

The 3% clawback you are referring came from an op ed report that was later retracted because it was misreported, not the cbo.

You are right that cbo is reporting that SS is 75% solvent until 2042, however the part you are leaving out is that it would require a payroll tax of over 25%(for ss and medicare) to repay the trust fund.

While you may not mind saddling your kids with such taxation to fund your retirement, I do have problems with it.

NO. SS is 100% solvent until 2042, not 75%.

So just answer this question then..

IF SS is 100% solvent after 2018 when SS starts to take in less than it pays out, what will the difference be paid out with?

Simple question.....

Will the goverment print money?
Raise taxes?
or cut benefits?


It has to do at least 1 of the 3....

Sorry, but you're wrong... with no changes at all, SS can pay 100% benefits until 2042 and about 75% thereafter.

Charrison, I wouldn't mind a "private" plan so much if it was well thought out and didn't threaten the system. The facts just don't follow Bush's plan.

From the second link I provided above

How long will Social Security be able to pay 100% of scheduled benefits?

Social Security has two dedicated trust funds?one for the Old Age and Survivor Insurance programs (OASI) and another for the Disability Insurance program (DI). Until 1983, Social Security operated on a pay-as-you-go basis (that is, no surpluses existed because all taxes paid into the system were immediately used to pay benefits). A 1983 bipartisan agreement revised the program so that it would generate surpluses for several decades to build up a trust fund because outlays were expected to increase substantially as the baby-boomer generation begins retiring and Americans continue to live longer. The trust fund balance is at $1.5 trillion and is currently running a surplus, with 74% of the money collected paid out as benefits. The remaining money goes into the Social Security trust funds and is invested in government bonds.

The Social Security Board of Trustees?which includes the Secretaries of Treasury, Labor, and Health and Human Services?is responsible for reporting the current and projected financial condition of the Social Security program each year. According to the trustees' "intermediate" scenario, the Social Security trust fund currently has enough money to pay 100% of scheduled benefits for the next 37 years, until 2042. (Social Security Trustees, The 2004 Annual Report of the Board of Trustees, March 23, 2004). Assuming there are no changes to the Social Security system?no tax increases and no benefit cuts?there will not be a shortfall for about four decades. Under the trustees' projections, when the trust fund runs out of money in 2042, the payroll taxes coming in would still be sufficient to pay retirees about 73% of their scheduled benefits. Importantly, those benefits would still be much higher in real (inflation-adjusted) terms than what retirees are being paid today. (Josh Bivens of EPI, Privatization fix for Social Security is worse than doing nothing, January 26, 2005). Under the trustees' more optimistic ("low-cost") scenario, there's no shortfall at all: the trust fund balance is projected to be $17.9 trillion in 2080.

The trustees estimate that in 2018 the cost of current benefits will exceed payroll tax collections. Because the trust fund is projected to reach $3.7 trillion (in 2004 dollars)in 2018 (more than twice the 2005 opening balance of $1.7 trillion), the Social Security system will be far from "bankrupt" in 2018. Instead, interest on U.S. Treasury bonds in the Social Security trust fund will be used to help pay benefits. (Jason Furman, Does Social Security Face a Crisis in 2018?, January 2005).

The nonpartisan Congressional Budget Office (CBO), which adopts a less pessimistic set of economic assumptions than the trustees' intermediate scenario, projects that the Social Security trust fund has enough money to pay all scheduled benefits for the next 47 years, until 2052 (Congressional Budget Office, The Outlook for Social Security, June 2004). Under the CBO's updated projections, when the trust fund runs out of money in 2052, the payroll taxes coming in will still be sufficient to pay retirees about 78% of scheduled benefits (Congressional Budget Office, Updated Long-term Projections for Social Security, January 2005).

So let me ask the question again.

in 2018 when SS takes in $9 and pays out $10, where does that dollar come from? Obviously it it is going to come from the SS trust fund. However that dollar is going to come from increased taxes, reduced benefits or printed money. You have fallen for the SS shell game.

Think about it, enron had nothing on goverment accounting.

 

[Darkhawk28]

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
His plan would cost us trillions in additional national debt.

Would reduce guaranteed benefits.

Is a stretch because the CBO (Congressional Budget Office) and the SS Trustees both say that the system is 100% solvent until 2042 and 73%-80% solvent indefinitely.

Broker fees and the shaving of the first 3% of your earning above and beyond what SS normally earns is taken.


That's just a start.

There is no 3% clawback. What goes into private account would be yours.

I'd rather lose with truth than win with lies.

You really should start doing your homework, because you are falling for anti-SS reform lies.

I guess the CBO are liars. BTW, the CBO are mostly REPUBLICANS.

BTW, I've offered REAL statistics, facts and figures. Your side has offered nothing but Bush's BS rhetoric.

The 3% clawback you are referring came from an op ed report that was later retracted because it was misreported, not the cbo.

You are right that cbo is reporting that SS is 75% solvent until 2042, however the part you are leaving out is that it would require a payroll tax of over 25%(for ss and medicare) to repay the trust fund.

While you may not mind saddling your kids with such taxation to fund your retirement, I do have problems with it.

NO. SS is 100% solvent until 2042, not 75%.

So just answer this question then..

IF SS is 100% solvent after 2018 when SS starts to take in less than it pays out, what will the difference be paid out with?

Simple question.....

Will the goverment print money?
Raise taxes?
or cut benefits?


It has to do at least 1 of the 3....

Sorry, but you're wrong... with no changes at all, SS can pay 100% benefits until 2042 and about 75% thereafter.

Charrison, I wouldn't mind a "private" plan so much if it was well thought out and didn't threaten the system. The facts just don't follow Bush's plan.

From the second link I provided above

How long will Social Security be able to pay 100% of scheduled benefits?

Social Security has two dedicated trust funds?one for the Old Age and Survivor Insurance programs (OASI) and another for the Disability Insurance program (DI). Until 1983, Social Security operated on a pay-as-you-go basis (that is, no surpluses existed because all taxes paid into the system were immediately used to pay benefits). A 1983 bipartisan agreement revised the program so that it would generate surpluses for several decades to build up a trust fund because outlays were expected to increase substantially as the baby-boomer generation begins retiring and Americans continue to live longer. The trust fund balance is at $1.5 trillion and is currently running a surplus, with 74% of the money collected paid out as benefits. The remaining money goes into the Social Security trust funds and is invested in government bonds.

The Social Security Board of Trustees?which includes the Secretaries of Treasury, Labor, and Health and Human Services?is responsible for reporting the current and projected financial condition of the Social Security program each year. According to the trustees' "intermediate" scenario, the Social Security trust fund currently has enough money to pay 100% of scheduled benefits for the next 37 years, until 2042. (Social Security Trustees, The 2004 Annual Report of the Board of Trustees, March 23, 2004). Assuming there are no changes to the Social Security system?no tax increases and no benefit cuts?there will not be a shortfall for about four decades. Under the trustees' projections, when the trust fund runs out of money in 2042, the payroll taxes coming in would still be sufficient to pay retirees about 73% of their scheduled benefits. Importantly, those benefits would still be much higher in real (inflation-adjusted) terms than what retirees are being paid today. (Josh Bivens of EPI, Privatization fix for Social Security is worse than doing nothing, January 26, 2005). Under the trustees' more optimistic ("low-cost") scenario, there's no shortfall at all: the trust fund balance is projected to be $17.9 trillion in 2080.

The trustees estimate that in 2018 the cost of current benefits will exceed payroll tax collections. Because the trust fund is projected to reach $3.7 trillion (in 2004 dollars)in 2018 (more than twice the 2005 opening balance of $1.7 trillion), the Social Security system will be far from "bankrupt" in 2018. Instead, interest on U.S. Treasury bonds in the Social Security trust fund will be used to help pay benefits. (Jason Furman, Does Social Security Face a Crisis in 2018?, January 2005).

The nonpartisan Congressional Budget Office (CBO), which adopts a less pessimistic set of economic assumptions than the trustees' intermediate scenario, projects that the Social Security trust fund has enough money to pay all scheduled benefits for the next 47 years, until 2052 (Congressional Budget Office, The Outlook for Social Security, June 2004). Under the CBO's updated projections, when the trust fund runs out of money in 2052, the payroll taxes coming in will still be sufficient to pay retirees about 78% of scheduled benefits (Congressional Budget Office, Updated Long-term Projections for Social Security, January 2005).

So let me ask the question again.

in 2018 when SS takes in $9 and pays out $10, where does that dollar come from? Obviously it it is going to come from the SS trust fund. However that dollar is going to come from increased taxes, reduced benefits or printed money. You have fallen for the SS shell game.

Think about it, enron had nothing on goverment accounting.

SS is currently running a surplus and the excess is invested in U.S. T-Bonds. The interest in those t-bonds will pay for that extra $1.

Not saying that after 2042, there won't be a problem. I'm just saying the fix doesn't have to be so drastic nor callous.

 

[charrison]

Originally posted by: Darkhawk28
[
SS is currently running a surplus and the excess is invested in U.S. T-Bonds. The interest in those t-bonds will pay for that extra $1.

Not saying that after 2042, there won't be a problem. I'm just saying the fix doesn't have to be so drastic nor callous.

And the goverment then uses taxes to pay redeem those tbonds. They have 3 options..

1. raise taxes to pay for them
2. reduce spending elsewhere
3. print money
4. replace the bond with another bond...


Do you understand yet? There is nothing in the trust fund, it is just an IOU that is worth about $2trillion. When those IOUs come due, they come to taxpayer so they can redeem them.

 

[Darkhawk28]

I've said it before that a declining tax rate above the maximum along with a declining benefit rate above the maximum is the best way to solve this problem. Plus, adjusting the maximum to % increase of average income from year to year is the way to go as well.

Let me explain....

$90k-$100k 12.0%
$100k-$110k 11.4%
$120k-$130k 10.8%

And so on and so forth...

Those numbers are just top of the head figures that aren't meant as concrete anything.

Also, lower the benefit amount by the same amount as the tax rate reduction.

Even I think millionaires and billionaires paying 12.4% is too much... by the time the tax rate hits their salary amount, the percentage should be less than 2%.

 

[charrison]

Originally posted by: Darkhawk28
I've said it before that a declining tax rate above the maximum along with a declining benefit rate above the maximum is the best way to solve this problem. Plus, adjusting the maximum to % increase of average income from year to year is the way to go as well.

Let me explain....

$90k-$100k 12.0%
$100k-$110k 11.4%
$120k-$130k 10.8%

And so on and so forth...

Those numbers are just top of the head figures that aren't meant as concrete anything.

Also, lower the benefit amount by the same amount as the tax rate reduction.

Even I think millionaires and billionaires paying 12.4% is too much... by the time the tax rate hits their salary amount, the percentage should be less than 2%.

I have no idea what you are trying to say....

 

[Darkhawk28]

Originally posted by: charrison

Originally posted by: Darkhawk28
[
SS is currently running a surplus and the excess is invested in U.S. T-Bonds. The interest in those t-bonds will pay for that extra $1.

Not saying that after 2042, there won't be a problem. I'm just saying the fix doesn't have to be so drastic nor callous.

And the goverment then uses taxes to pay redeem those tbonds. They have 3 options..

1. raise taxes to pay for them
2. reduce spending elsewhere
3. print money
4. replace the bond with another bond...


Do you understand yet? There is nothing in the trust fund, it is just an IOU that is worth about $2trillion. When those IOUs come due, they come to taxpayer so they can redeem them.

Well, that's where Jhnnn's comments fit in. Stop ripping off the SS surplus and balance our budget, then that won't be a problem.

 

[charrison]

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
[
SS is currently running a surplus and the excess is invested in U.S. T-Bonds. The interest in those t-bonds will pay for that extra $1.

Not saying that after 2042, there won't be a problem. I'm just saying the fix doesn't have to be so drastic nor callous.

And the goverment then uses taxes to pay redeem those tbonds. They have 3 options..

1. raise taxes to pay for them
2. reduce spending elsewhere
3. print money
4. replace the bond with another bond...


Do you understand yet? There is nothing in the trust fund, it is just an IOU that is worth about $2trillion. When those IOUs come due, they come to taxpayer so they can redeem them.

Well, that's where Jhnnn's comments fit in. Stop ripping off the SS surplus and balance our budget, then that won't be a problem.

Yes, but he incorrectly blames the current setup on republicans, when it was LBJ that pushed SS off budget.

Even if we put SS back on budget and invested SS surpluses in real assets we still have $2T that is owed to the program. The current system is broke and we cannot continue doing paygo as the demographics no longer support doing this.

Taxes will be going up when the SS surplues go away...

 

[Darkhawk28]

Originally posted by: charrison

Originally posted by: Darkhawk28
I've said it before that a declining tax rate above the maximum along with a declining benefit rate above the maximum is the best way to solve this problem. Plus, adjusting the maximum to % increase of average income from year to year is the way to go as well.

Let me explain....

$90k-$100k 12.0%
$100k-$110k 11.4%
$120k-$130k 10.8%

And so on and so forth...

Those numbers are just top of the head figures that aren't meant as concrete anything.

Also, lower the benefit amount by the same amount as the tax rate reduction.

Even I think millionaires and billionaires paying 12.4% is too much... by the time the tax rate hits their salary amount, the percentage should be less than 2%.

I have no idea what you are trying to say....

Right now, the salary cap on SS taxes is $90,000.

I propose increasing the cap to reflect the last year's increased percentage of yearly salaries.

For example, 2003, average salary was $30,000 (just a number out of thin air).
In 2004, average salary increases to $30,500. (An increase of 1.67%)

The new SS cap would be $90,000 *1.0167 = $91,503.


Ok, now.... consider that cap the start of the tax percentage dropoff. From $91,503 onward, the SS tax rate percentage would decrease incrementally.

By the time it reaches millionaires, it should be less than 2% (or even less than that).

Also, reduce the benefit % of those that are above that SS cap. (by similar %'s)

 

[Darkhawk28]

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
[
SS is currently running a surplus and the excess is invested in U.S. T-Bonds. The interest in those t-bonds will pay for that extra $1.

Not saying that after 2042, there won't be a problem. I'm just saying the fix doesn't have to be so drastic nor callous.

And the goverment then uses taxes to pay redeem those tbonds. They have 3 options..

1. raise taxes to pay for them
2. reduce spending elsewhere
3. print money
4. replace the bond with another bond...


Do you understand yet? There is nothing in the trust fund, it is just an IOU that is worth about $2trillion. When those IOUs come due, they come to taxpayer so they can redeem them.

Well, that's where Jhnnn's comments fit in. Stop ripping off the SS surplus and balance our budget, then that won't be a problem.

Yes, but he incorrectly blames the current setup on republicans, when it was LBJ that pushed SS off budget.

Even if we put SS back on budget and invested SS surpluses in real assets we still have $2T that is owed to the program. The current system is broke and we cannot continue doing paygo as the demographics no longer support doing this.

Taxes will be going up when the SS surplues go away...

Trim away Bush's tax cut to the wealthiest people in this country and spread that "trim away" over the next 50 years and voila. Done.

Edit: Trim away a very small percentage of that tax cut. Not a large piece, I should've put that in there.

 

[charrison]

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
I've said it before that a declining tax rate above the maximum along with a declining benefit rate above the maximum is the best way to solve this problem. Plus, adjusting the maximum to % increase of average income from year to year is the way to go as well.

Let me explain....

$90k-$100k 12.0%
$100k-$110k 11.4%
$120k-$130k 10.8%

And so on and so forth...

Those numbers are just top of the head figures that aren't meant as concrete anything.

Also, lower the benefit amount by the same amount as the tax rate reduction.

Even I think millionaires and billionaires paying 12.4% is too much... by the time the tax rate hits their salary amount, the percentage should be less than 2%.

I have no idea what you are trying to say....

Right now, the salary cap on SS taxes is $90,000.

I propose increasing the cap to reflect the last year's increased percentage of yearly salaries.

For example, 2003, average salary was $30,000 (just a number out of thin air).
In 2004, average salary increases to $30,500. (An increase of 1.67%)

The new SS cap would be $90,000 *1.0167 = $91,503.


Ok, now.... consider that cap the start of the tax percentage dropoff. From $91,503 onward, the SS tax rate percentage would decrease incrementally.

By the time it reaches millionaires, it should be less than 2% (or even less than that).

Also, reduce the benefit % of those that are above that SS cap. (by similar %'s)

However completely removing the cap only solved about 1/2 the SS funding issues, while giving more congress more money SS surpluses to spend. Raising payroll taxes is not a fix until there is major reform to how congress handles ss surpluses.

 

[Darkhawk28]

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
I've said it before that a declining tax rate above the maximum along with a declining benefit rate above the maximum is the best way to solve this problem. Plus, adjusting the maximum to % increase of average income from year to year is the way to go as well.

Let me explain....

$90k-$100k 12.0%
$100k-$110k 11.4%
$120k-$130k 10.8%

And so on and so forth...

Those numbers are just top of the head figures that aren't meant as concrete anything.

Also, lower the benefit amount by the same amount as the tax rate reduction.

Even I think millionaires and billionaires paying 12.4% is too much... by the time the tax rate hits their salary amount, the percentage should be less than 2%.

I have no idea what you are trying to say....

Right now, the salary cap on SS taxes is $90,000.

I propose increasing the cap to reflect the last year's increased percentage of yearly salaries.

For example, 2003, average salary was $30,000 (just a number out of thin air).
In 2004, average salary increases to $30,500. (An increase of 1.67%)

The new SS cap would be $90,000 *1.0167 = $91,503.


Ok, now.... consider that cap the start of the tax percentage dropoff. From $91,503 onward, the SS tax rate percentage would decrease incrementally.

By the time it reaches millionaires, it should be less than 2% (or even less than that).

Also, reduce the benefit % of those that are above that SS cap. (by similar %'s)

However completely removing the cap only solved about 1/2 the SS funding issues, while giving more congress more money SS surpluses to spend. Raising payroll taxes is not a fix until there is major reform to how congress handles ss surpluses.

You're right, that is only one side of the equation. We need to put to stop raiding SS as well.

Edit: Back in the day, there was no salary cap, everybody put in the same amount. I'm not proposing that, but an ever-decreasing percentage wouldn't hurt. Hell, by the time it got to millionaires it could be at 1% and even 0.5% by the time it hit billionaires.

 

[charrison]

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28

Originally posted by: charrison

Originally posted by: Darkhawk28
[
SS is currently running a surplus and the excess is invested in U.S. T-Bonds. The interest in those t-bonds will pay for that extra $1.

Not saying that after 2042, there won't be a problem. I'm just saying the fix doesn't have to be so drastic nor callous.

And the goverment then uses taxes to pay redeem those tbonds. They have 3 options..

1. raise taxes to pay for them
2. reduce spending elsewhere
3. print money
4. replace the bond with another bond...


Do you understand yet? There is nothing in the trust fund, it is just an IOU that is worth about $2trillion. When those IOUs come due, they come to taxpayer so they can redeem them.

Well, that's where Jhnnn's comments fit in. Stop ripping off the SS surplus and balance our budget, then that won't be a problem.

Yes, but he incorrectly blames the current setup on republicans, when it was LBJ that pushed SS off budget.

Even if we put SS back on budget and invested SS surpluses in real assets we still have $2T that is owed to the program. The current system is broke and we cannot continue doing paygo as the demographics no longer support doing this.

Taxes will be going up when the SS surplues go away...

Trim away Bush's tax cut to the wealthiest people in this country and spread that "trim away" over the next 50 years and voila. Done.

Edit: Trim away a very small percentage of that tax cut. Not a large piece, I should've put that in there.

Still not enough...and the same problems till remains..congress still has the money to spend and can replace it with one of those lovely IOUs....