Privatization of Social Security

[glenn1]

BUT, and this is a big but, our current Social Security tax goes to pay CURRENT retired people. If we set up a system where we stop paying into the fund and put it wherever we want, I think we'll do better, but the current generation of retired people is boned.

We need some kind of phased system, but I have trouble seeing how that will work with more money being taken out of the system than goes in to it. Any thoughts?

Well, the current SS Trust Fund balance is about $1.5 trillion and current unfunded obligation of $3.5 trillion for the 75-year time horizon (current projections with no changes), so it's doable. It's not going to be easy like you pointed out, but the longer we wait the harder it'll get.

 

[SuperTool]

Originally posted by: glenn1

BUT, and this is a big but, our current Social Security tax goes to pay CURRENT retired people. If we set up a system where we stop paying into the fund and put it wherever we want, I think we'll do better, but the current generation of retired people is boned.

We need some kind of phased system, but I have trouble seeing how that will work with more money being taken out of the system than goes in to it. Any thoughts?

Well, the current SS Trust Fund balance is about $1.5 trillion and current unfunded obligation of $3.5 trillion for the 75-year time horizon (current projections with no changes), so it's doable. It's not going to be easy like you pointed out, but the longer we wait the harder it'll get.

Is the 1.5T IOUs?
Where are they gonna get the money to cover those?

 

[AFB]

When I look around I get worried because I see the fact that many people will not know what the word investing means and hence will never be able to retire because they spent it on beer. While I could care less about how their choices affect them, I care how their choices will affect other people when they realize that they suddenly can't work and have no money.

 

[Zebo]

How do we deal with millions of disabled? Blind/diabetic/etc?? Most never paid in and revieve from day 1.

 

[glenn1]

Is the 1.5T IOUs?
Where are they gonna get the money to cover those?

Same place we would if we take no actions to change anything.

 

[IHateMyJob2004]

Originally posted by: Train
Since this seems to be a likely move by the GOP within the next few years, how does everyone feel about this and why?

Social Security was created when people didn't live past 60. So the money was simply used elsewhere. But now people live WAY PAST 60. See the true problemn here.. It's a ponzi scheme at this point.

I personally would rather not pay into it period, but I understand others need to get what they were promised. So simply reduce social security and eliminate it over time. That's all that can be done.

 

[Genx87]

I am for it. Anything to keep the broken SS program from bankrupting this country.

 

[plagiarist]

Social Security was created when people didn't live past 60. So the money was simply used elsewhere. But now people live WAY PAST 60. See the true problemn here.. It's a ponzi scheme at this point.

I personally would rather not pay into it period, but I understand others need to get what they were promised. So simply reduce social security and eliminate it over time. That's all that can be done.

what he said

 

[Cerb]

For privatization.
1. It goes into a pool, not an account.
2. That is then divided into monies for SS and non-SS uses.
3. The government is allowed to control a significant amount of money they shouldn't be allowed to.
4. It is a universal form of identification. Bad.

My personal ideas:
1. Roll SS into income/sales tax and BE DONE WITH IT.
2. Begin allowing tax credits for putting your money into a proper savings account, and set the cut-off to four years from that point. So if you are no longer an independent from 4 years after that or later, you won't get SS when you're old and dying. Four years should allow people to change their spending and saving habits, even with meeger funds. After 10 years, tex credits would end.

 

[nageov3t]

I'd like to see it privatized.

SS isn't going to be there in 50 when I'm illegible for it, so why wait 50 years to screw myself over when I can screw old people over on it now, and maybe recover enough in taxes to afford having my cleaning lady come once a week instead of every 2 weeks

 

[NesuD]

I honestly can't come down solidly one way or the other on this. I lean towards privatization only because In its present form or any form resembling that it simply cannot survive. It is mathematically impossible to continue running SS like it runs now without massive and i mean MASSIVE tax increases. Modifying SS to allow people to voluntarily direct a portion of their SS taxes to investment accnts seems like a step in the right direction to me.

 

[Pliablemoose]

AS Kerry was in favor of extending the health care coverage plan of federal employees, I'd like to see a hybrid (opt out) type system for SS & something similar to this: Thrift Savings Plan in place as an option.

 

[Darkhawk28]

Originally posted by: Infohawk
I like what someone else said. I don't think it's going to be privatized but if it is just get rid of it... but maybe it was just a code-word for getting rid of it anyway right?

I'd have to agree with that. I'd rather they disband the program and grant everyone a refund of all the money they've ever put into the program during their lifetime. I think that'd be a much better solution to putting it in the hands of the volatile stock market.

 

[Mursilis]

Originally posted by: Darkhawk28

Originally posted by: Infohawk
I like what someone else said. I don't think it's going to be privatized but if it is just get rid of it... but maybe it was just a code-word for getting rid of it anyway right?

I'd have to agree with that. I'd rather they disband the program and grant everyone a refund of all the money they've ever put into the program during their lifetime. I think that'd be a much better solution to putting it in the hands of the volatile stock market.

It's amazing that even some of the board's more left-leaning members are no longer buying into the program. Maybe political force is actually building toward major reform?
BTW, while I myself like the idea of ending it and granting everyone a refund of money paid in (plus a reasonable interest rate), you do realize that this would effectively END future SS payments for many of today's seniors? You see, part of the reason the system is going bankrupt is because many of today's seniors are receiving far in excess of what they paid into the system (plus a reasonable rate of interest). Take Ida Mae Fuller, the very first SS recipient. She paid ~$22 into the system, and immediately got that back w/ her first SS check. But then she lived to be 100, and eventually collected ~$22K in benefits. Nice system, huh? Pay $22, get $22000. So not only did she get back all of "her" money, she got lots of everyone else's, too. Just like today's seniors, who are living a lot longer than the gov't thought they would when they were taking SS out of their paychecks in the 50's and 60's. Now we've got a huge mess, and no easy way to clean it up. But at least people are starting to realize that in fact the system is broken. Can't wait to see what the Republicans do about it.

 

[Darkhawk28]

Originally posted by: Mursilis

Originally posted by: Darkhawk28

Originally posted by: Infohawk
I like what someone else said. I don't think it's going to be privatized but if it is just get rid of it... but maybe it was just a code-word for getting rid of it anyway right?

I'd have to agree with that. I'd rather they disband the program and grant everyone a refund of all the money they've ever put into the program during their lifetime. I think that'd be a much better solution to putting it in the hands of the volatile stock market.

It's amazing that even some of the board's more left-leaning members are no longer buying into the program. Maybe political force is actually building toward major reform?
BTW, while I myself like the idea of ending it and granting everyone a refund of money paid in (plus a reasonable interest rate), you do realize that this would effectively END future SS payments for many of today's seniors? You see, part of the reason the system is going bankrupt is because many of today's seniors are receiving far in excess of what they paid into the system (plus a reasonable rate of interest). Take Ida Mae Fuller, the very first SS recipient. She paid ~$22 into the system, and immediately got that back w/ her first SS check. But then she lived to be 100, and eventually collected ~$22K in benefits. Nice system, huh? Pay $22, get $22000. So not only did she get back all of "her" money, she got lots of everyone else's, too. Just like today's seniors, who are living a lot longer than the gov't thought they would when they were taking SS out of their paychecks in the 50's and 60's. Now we've got a huge mess, and no easy way to clean it up. But at least people are starting to realize that in fact the system is broken. Can't wait to see what the Republicans do about it.

Actually, I'd prefer it be abolished rather it be gang-raped by special interest groups and profiteers.

 

[CaptnKirk]

Let's just put it all into Enron right now, gotta love those Lesiure Service companies.

That's what will happen if the Government allows that to happen, open the walls -
let the Plunderning begin. We'll hold back the Pillaging until the Raping is completed.

 

[Spencer278]

It takes two steps to fix SS.Step one added in means testing so that no old, disable, or child ends up in the poor house. Step 2 prevent SS from ever having a surpluses and then raided by the general found. Any surpluse should either be paid out as extra benifits or result in a rate cut for next quater.

Edit: If you think the R's are going to fix SS you have another thing coming. They will not touch it at all because they aren't really conseritive fisically.

 

[MidasKnight]

Originally posted by: lozina
Privatize and make it optional.

Allow people who have been paying the mandatory tax- I mean social security should be compensated if they so choose or rollover the value to the private plan

I like that idea.

 

[RobCur]

Most of you still don't get it! Everyone believe they can get rich investing in stock market and even gambling at las vegas, so many baffoon... when will they learn?
here's why

 

[imported_tss4]

There's a lot of cartoons in that link.

 

[Pliablemoose]

Looks like what's left of the Democratic leadership has decided to take a stand against privatization. IIRC, this is an unpopular choice of younger voters who voted mostly for Kerry...

Link

 

[PingSpike]

Originally posted by: Mursilis

Originally posted by: Darkhawk28

Originally posted by: Infohawk
I like what someone else said. I don't think it's going to be privatized but if it is just get rid of it... but maybe it was just a code-word for getting rid of it anyway right?

I'd have to agree with that. I'd rather they disband the program and grant everyone a refund of all the money they've ever put into the program during their lifetime. I think that'd be a much better solution to putting it in the hands of the volatile stock market.

It's amazing that even some of the board's more left-leaning members are no longer buying into the program. Maybe political force is actually building toward major reform?

I think most people realized long ago that the program was broken beyond repair and either needed to be abolished or majorly overhauled.

 

[Infohawk]

So who is going to feel sorry for the Bush supporters that lose their pensions in 20 or 30 years (or even before that)?

Face it, once the government doesn't guarantee some retirement income, there will be a lot of schmucks who lose their retirement. Should we feel bad for them if they voted Republican?

 

[PatboyX]

i sort of like the "security" of social security. if you are going to make me gamble with it, might as well just get rid of it all together.
i feel like one of two options with the whole "investment" thing can occur
1. i end up with actual investing freedom and have to figure out how to invest, get someone to invest for me, etc etc and spend more than i could possibly make
2. i will be given very specific choices of where i can invest in (not trying to be paranoid...but...lets say...for example, first company that pops into my head, Halliburton) and it will benefit someone who is not me and, if i do gain, its still a gamble.

at the same time, i should point out that i am pretty well set for retirement. i make enough that i can actually put cash aside if i want and the job im in has a pension program. i think most of us here are in the same boat (being pretty well-off)
it might be worth it to consider that there are many people that may not be able to plan as we can.
which, i think, is where the security really helps.

 

[PingSpike]

To answer the OP:

In the debates Bush brought up privatization, and Kerry said it was a recipe for disaster. My thinking was, everyone who could opt out and invest/save/whatever their money would. This would leave the current system seniors are living off of screwed. Then what do we do? Roll it into sales/income tax? Slash the benefits? Just run it as a loss like everything else?

If Bush sets up some kind of opt out plan like that...I'll take it and hit the ground running. Because I'm sure I'll be bit in the ass by its fallout. Hopefully when they have to tax somewhere to cover the old program, it won't fall on my shoulders...but I can't count on it.

I sort of secretly hope they just slash the benefits...afterall the seniors voted mostly for Bush. Let them reap what they sow. Naw, thats a bit to cruel.