would having the govt mandate everyone setup an IRA work?

[matt0611]

Why should I pay 17% of my income to help pay for your tax breaks?

Take it or leave it. Both SS and tax breaks. Or neither. If you want government out of providing for your security, then get it out (and that means tax breaks too). Otherwise, you are two-faced. You want no government help but you want government to help you save with tax breaks.

Fine, get rid of tax breaks for everthing then.
Better lower my income tax too though.

Taxing peoples investment is a pretty poor tax choice. but if that will satisfy you.

 

[dullard]

Fine, get rid of tax breaks for everthing then.

Oh, and by the way, it is 10.4% this year, not 15%. It never was 15%. It is normally 12.4% (Acutally a bit less than 12.4% if you count the deductions for the tax payments).

 

[dullard]

My biggest issue is that I am being forced to pay into a system that is telling my I will only get 75% of what they are promising. Start a gradual rise in the retirement age until it's pegged to life expectancy and solevent long term and I will have little to no issues with SS

I'm all for putting SS back where it started: for payments when you exceed the life-expectancy (now around age 80). It is called the "old-age" benefit of SS after all (not the "I want many years of retirement" benefit). I've posted that idea in many, many threads. I'd probably at this point leave the survivors and disability insurance payments in tact. But, I'd be willing to compromise I suppose.

The OP hasn't stated what we'd switch to once we lose the survivors and disability insurances in his plan.

 

[matt0611]

Oh, and by the way, it is 10.4% this year, not 15%. It never was 15%. It is normally 12.4% (Acutally a bit less than 12.4% if you count the deductions for the tax payments).

The 12.4 is the number I was thinking of. I think the 15% is SS + medicare, got confused. Still don't want though.

 

[matt0611]

Also, no I don't want "government help" I actually want government to stay out of peoples income + savings all together as well as their retirement.

 

[Tom]

It relies on an inflow of taxes from peoples pay checks to pay current retirees. As of now its running in the red. So yes, there is financial problems. Can they be fixed? of course they can. As of now they are not fixed though, thats my point. It is NOT well funded currently.

No, there's a huge SS surplus. The issue is using the surplus for what I and others have been paying for decades, not other government spending.

That's a political issue. So is tinkering with stuff like retirement age, means testing, other relatively minor changes.

In any case, changing over to IRAs or individually managed retirement isn't going to make things better, there's no free money out there.

 

[Exterous]

Also, no I don't want "government help" I actually want government to stay out of peoples income + savings all together as well as their retirement.

I do think SS would provide a needed service if it was structured more in a way to help those with unforseen circumstances/beyond life expectancey needs. As it stands now (The retirment fund of choice) it is a big problem

 

[SagaLore]

Nothing is going to work. Nothing will be perfect; nothing will be adequate. At least not with how the government is setup now.

Lawmakers and law-enforcers cannot solve this.

What we need is a new federal governing body just to handle the nation's well being. A new "house". The Assembly of Advocates. There would be 1 elected official representing each of the 6 regions of the United States, and 1 additional advocate appointed by the President. This assembly would oversee all federal social services. The House of Representatives would set the total monetary allocation for the tri-annual budget, but the Assembly would handle individual allocations and execution of expenditure. The Senate would approve the final budget with a 51% or more majority vote.

 

[bamacre]

No, there's a huge SS surplus.

When did this happen? Where is this SS surplus and how much is it?

 

[alkemyst]

The main problem with SS is mostly all g'ment money being a common pool. It's gotten raped.

At the same time, yes people are living longer too. So there is an issue in that.

In reality though the amount our government spends on fickle things is a drop in a missile silo on supporting elderly americans.

 

[dullard]

When did this happen? Where is this SS surplus and how much is it?

http://www.ssa.gov/oact/progdata/assets.html

The SS trust fund has about $2.6 trillion dollars. That money is in securities (basically government bonds). That is a POSITIVE $2.6 trillion and is earning interest. Since it is positive, that is above zero, and thus by definition, a surplus.

Of course in the worst case scenario, the bonds may not be paid off and that money may vanish (as is true with any kind of investment). People who are dead set against SS assume that this worst case scenario will happen and thus assume there is no money in SS.

 

[matt0611]

http://www.ssa.gov/oact/progdata/assets.html

The SS trust fund has about $2.6 trillion dollars. That money is in bonds.

Aren't these government bonds? In which case the government will have to pay back the money to itself right?
Doesn't really help us lol.

Isn't that kinda like me claiming I'm rich cause I have a million day check written by me to myself?

 

[Tom]

Aren't these government bonds? In which case the government will have to pay back the money to itself right?
Doesn't really help us lol.

Isn't that kinda like me claiming I'm rich cause I have a million day check written by me to myself?

No it isn't like that. The check wasn't written by you(government), it was written by others(FICA payees) and paid to you(government) for a specific purpose.

You meet that obligation or you are in default.

 

[Engineer]

Aren't these government bonds? In which case the government will have to pay back the money to itself right?
Doesn't really help us lol.

Isn't that kinda like me claiming I'm rich cause I have a million day check written by me to myself?

The government will simply borrow the $2.6 trillion from other sources to pay the bonds from SS. That money will be then paid out. Net new debt from this will be 0.

(Note: This doesn't mean that SS will not eventually run out of money or other arrangements need / will be made. The SS trust fund will be replenished from the IOU's, in the next few decades, by borrowing money from other sources, it's as simple as that.

 

[First]

When did this happen? Where is this SS surplus and how much is it?

Wow, this is just sad. SS is funded for 25-40 years if the U.S. does nothing right now depending on interest and what we decide to do with the bonds.

 

[matt0611]

The government will simply borrow the $2.6 trillion from other sources to pay the bonds from SS. That money will be then paid out. Net new debt from this will be 0.

(Note: This doesn't mean that SS will not eventually run out of money or other arrangements need / will be made. The SS trust fund will be replenished from the IOU's, in the next few decades, by borrowing money from other sources, it's as simple as that.

Right, the end result is basically the same as not having the bonds at all though, its just that the debt won't "technically increase" because the money has already been counted as a liability.

 

[bamacre]

http://www.ssa.gov/oact/progdata/assets.html

The SS trust fund has about $2.6 trillion dollars. That money is in securities (basically government bonds). That is a POSITIVE $2.6 trillion and is earning interest. Since it is positive, that is above zero, and thus by definition, a surplus.

Of course in the worst case scenario, the bonds may not be paid off and that money may vanish (as is true with any kind of investment). People who are dead set against SS assume that this worst case scenario will happen and thus assume there is no money in SS.

I see. So the government's SS fund has $2.6T in assets, but the assets are IOU's from the government. But that's ok, because it's really the taxpayers who have $2.6T in assets in the SS fund, and the money is owed to them by the government. Wait, where is the government gonna get the $2.6T to pay off the taxpayers? Oh, yeah, taxpayers. Yeah, I see. Good thing someone is watching over and being responsible with the money that otherwise wouldn't be spent responsibly.

 

[bamacre]

Wow, this is just sad. SS is funded for 25-40 years if the U.S. does nothing right now depending on interest and what we decide to do with the bonds.

Yeah, I have no idea what I was thinking.

 

[the DRIZZLE]

The government will simply borrow the $2.6 trillion from other sources to pay the bonds from SS. That money will be then paid out. Net new debt from this will be 0.

(Note: This doesn't mean that SS will not eventually run out of money or other arrangements need / will be made. The SS trust fund will be replenished from the IOU's, in the next few decades, by borrowing money from other sources, it's as simple as that.

Where is the Government going to get the other 15 trillion to pay for the projected unfunded liability of ss?

 

[First]

Yeah, I have no idea what I was thinking.

Ironically accurate since your response to dullard's post was nonsense; all gov't programs are financed in some way by the federal gov't so your response was an exercise in nothing particularly meaningful. You not understanding or comprehending how bonds/T-bills finance SS isn't really a concern for those looking for serious answers to questions about SS' solvency, which it can meet for the aforementioned period of time in a worst case scenario.

 

[the DRIZZLE]

The government will simply borrow the $2.6 trillion from other sources to pay the bonds from SS. That money will be then paid out. Net new debt from this will be 0.

(Note: This doesn't mean that SS will not eventually run out of money or other arrangements need / will be made. The SS trust fund will be replenished from the IOU's, in the next few decades, by borrowing money from other sources, it's as simple as that.

This is incorrect. Currently the trust fund is considered an asset on the government's balance sheet even though its held in t bills. The treasury has a liability for the amount of the t bill so the net accounting effect is 0. BUT, if you issue new bonds to pay the benefits you have removed the asset but kept the liability so the net debt will increase.

 

[the DRIZZLE]

http://www.forbes.com/2009/05/14/taxes-social-security-opinions-columnists-medicare.html

This article is old but it does a decent job of explaining the unfunded liability issue and puts the numbers in perspective.

 

[bamacre]

Ironically accurate since your response to dullard's post was nonsense; all gov't programs are financed in some way by the federal gov't so your response was an exercise in nothing particularly meaningful. You not understanding or comprehending how bonds/T-bills finance SS isn't really a concern for those looking for serious answers to questions about SS' solvency, which it can meet for the aforementioned period of time in a worst case scenario.

LOL, are you serious?

SS is nowhere near the problem that is Medicare, but for someone to say SS is "very well funded," I'm sorry, that's a joke.

 

[rudder]

Instead of mandating anything, how about offering people the option to opt out? I'd just assume not pay into SS and do my own savings in the off chance that I never get to collect SS.

Because you would have people opt out... spend every penny of savings and come crying to the government when they are 65 and have no money.

If we could also implement a tough shit law... lets do it.

 

[Engineer]

This is incorrect. Currently the trust fund is considered an asset on the government's balance sheet even though its held in t bills. The treasury has a liability for the amount of the t bill so the net accounting effect is 0. BUT, if you issue new bonds to pay the benefits you have removed the asset but kept the liability so the net debt will increase.

If that's true, then the government accounting system sucks (in my opinion). How can you have something as an asset that is spent? I don't understand accounting very well and will not pretend to but what you say sounds almost like fraud (I'm sure that there is some technical way around it or maybe I don't know and it's just the way it is).

So you borrowed from yourself, and spent it (meaning it's gone) but you have an asset from it as well as a liability. I guess the net 0 means that there is nothing there and you would indeed have to borrow it to pay it.

Wow....

Enron anyone? Maybe? Makes my head hurt!!!