Worthless...

[lurch00]

I don't feel much like writing about this right now, but I just wanted to point out how worthless the Democratic response to tonight's TV interruption.. I mean, State of the Union address. Say what you want about some of the solutions proposed for social security. At least the President put it on the table and opened debate for it. Obviously, the

Comments

[lurch00]

I don't think the key number is the number of workers vs the number of retirees - social security is sustainable as long as it takes in at least as much as it pays out. If the number of workers paying into it goes down, the average contribution needs to go up, either through an increase in the tax rate or by increasing wages. I guess Bush's plan is to decrease the amount it pays out instead of increasing how much goes in. That does make the numbers balance, but yo me, it seems like diverting that money into the stock market is trading away most of the security. Why isn't he pushing for full privatization?

So no matter what the date is, unles something changes, it won't be around for me to use. That's okay with me, I'm well enough off and have enough discipline to provide for my own retirement (provided the stock market doesn't crash again, of course). I'm even willing to look at the $400k plus that I'll contribute in my lifetime that will only go to providing benefits for other people as a charitable contribution to society. But I'm concerned about the system for other people. I'm really good friends with a guy who will never get a college degree, and might spend the rest of his working life just trying to stay above the poverty line. Or my brother, who'll likely do okay, but will have a lot less disposable income to save than I do. I do think that we have a responsibility to provide a social security system, so that if you enter retirement debt free you'll be able to live reasonably for the rest of your life. Any extra assets you bring to it is just cushy.

I guess I look at social security as forced retirement planning. I think a strict government system based on treasury bonds and currency markets and whatever economic voodoo social security is based on is a very important part of that. And I think a personal account to augment that is a good thing. We have these now, with 401k, 403b, etc. Why can't they just say "everyone needs to put an additional 5% of their income into retirement, but you have the choice of putting it into social security or one of our special 401k-like-things." What makes SS work is that some people pay more than others, but everyone gets the same amount out. If Bush's plan takes away from that margin (presumably provided by the filthy rich) then we won't be able to provide for the people who put in less than the average, and I'm absolutely against that scenario.

After talking all that out, I guess I don't see why we need these new private accounts. We already have IRAs, 401k, 403b, etc, which people can use to provide personal retirement savings backed by the public markets. So we need to either increase the tax or restructure the benefits such that it reduces expenses, right?

[nushawn]

There's another way that could very simply "save" social security that hasn't been mentioned in all of this. All they have to do is take the ceiling off of the earnings for which you are taxed. I'm lazy right now and bitter about the fact that i have to work until 4 AM on a friday night, and it's my birthday to boot, but i believe that above about 90K for someone filing single you stop paying into social security. If this change were made then the system would be liquid for hundreds of years. Of course that's not possible as politicians would have to bite the hand that feeds them to do it. I guess it just goes to the point about revenue in vs. revenue out.