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jAZ
02-13-2005, 07:49 PM
... no... it's because politicians have been borrowing against the SS Trust fund to pay for ridiculous spending sprees.

The Republican controlled Congress doesn't want to talk about this, because it crushes the need for wholesale, ideologically driven changes to the SS system.

But the fact of the matter is that (while an incomplete retirement system) SS is a perfectly workable system. And Alan Greenspan put in place a funding mechanism that (if Bush, Congress and the like had just kept their hands off it over the last 20 years) would have adequately funded the boomer population bubble.

The real problems aren't fixed by replacing SS.

The real problems are from pork-barrel politics in DC.

http://moneycentral.msn.com/content/Specials/P107171.asp


Myth No.1: There is no Social Security trust fund.

You may have heard this assertion so often that you'll be surprised to learn that there really IS a Social Security trust fund that collects our payroll taxes and invests the surplus. It's called the Old-Age and Survivors Insurance and Disability Insurance Trust Funds.

What isn't in the trust fund is a big hoard of cash.

Three-quarters of the money that's collected in Social Security taxes goes right out the door again in the form of benefits to Social Security recipients. The surplus that isn't needed to pay benefits is loaned to the federal government to pay for other programs.

In return for this loan, the trust fund gets IOUs in the form of special-issue, interest-paying Treasury bonds. The interest isn't paid in cash, however; the Treasury department issues the fund additional bonds for the interest amount. Last year, the fund was credited with $80 billion in interest; the total value of the securities is about $1.5 trillion.

Critics often deride these bonds as "a bookkeeping entry" or a fiction, but they're real obligations of the U.S. government, said Steve Goss, Social Security's chief actuary. In the past, they've been cashed in when Social Security or its sister program, Medicare, temporarily ran low on funds. The last time was in the early 1980s.

"They're backed by the full faith and credit of the U.S. government," Goss said. "They're every bit as real . . . as any savings bond or Treasury bond any individual might hold in society."

The problem, of course, is that the government now owes the trust fund so much money -- and relies on its surplus so heavily -- that real problems will be created when it comes time to cash in those IOUs. Uncle Sam is going to need to find another source of income to replace the surplus (or cut spending, or borrow money from somewhere else), plus come up with cash to pay the bonds it's already issued.

Amnorix
02-13-2005, 08:13 PM
The problem, of course, is that the government now owes the trust fund so much money -- and relies on its surplus so heavily -- that real problems will be created when it comes time to cash in those IOUs. Uncle Sam is going to need to find another source of income to replace the surplus (or cut spending, or borrow money from somewhere else), plus come up with cash to pay the bonds it's already issued.

And there's the real rub. Regardless of how you cast it, we created this problem for ourselves in the 80s, and the only way to repay those obligations is through massive tax increases or dramatic benefit reductions. Neither is either politically feasible or desireable.

The only thing left to us is to find another solutions that involves dramatically altering Social Security.

I also note that in the long, long run Social Security is doomed anyway. Maybe it's 100 years instead of 30, or whatever, but ultimately SS can't survive as it currently operates. Simply demographics tell us that much.

KCWolfman
02-13-2005, 08:22 PM
So the SS system was still at a meager 3% in the 1980s of a total paycheck?

If not, then why increase the percentage from a system that is not "flawed" prior to the Republican controlled Congress?

1935 - 2%
1950 - 3%
1956 - 4%
1961 - 6%
1972 - 9.2%
1977 - 9.9%


This is all prior to the evil Republican Empire of 1980. A system that is not "flawed" does not require continual exponential increases

Please don't sh*t on my plate and tell me it is steak.

jAZ
02-13-2005, 09:31 PM
So the SS system was still at a meager 3% in the 1980s of a total paycheck?

If not, then why increase the percentage from a system that is not "flawed" prior to the Republican controlled Congress?

1935 - 2%
1950 - 3%
1956 - 4%
1961 - 6%
1972 - 9.2%
1977 - 9.9%


This is all prior to the evil Republican Empire of 1980. A system that is not "flawed" does not require continual exponential increases

Please don't sh*t on my plate and tell me it is steak.
Maybe you aren't aware that the SS system was tweaked in the 80's to account for the main weakness (flaw). That flaw was an (as then funded) inability to handle a boomer population bubble.

Alan Greenspan (under Reagan) fixed that "flaw" by having the boomers (and future generations) advance-pay for their larger retirement needs via increased SS tax rates.

That "flaw" was fixed by the Republicans in 1984, IIRC.

Replacing SS with private accounts will replace one problem with another. That's not fixing a flawed system at all. It's moving around flaws under the cloak of political hocus pocus.

Rausch
02-13-2005, 09:33 PM
... no... it's because politicians have been borrowing against the SS Trust fund to pay for ridiculous spending sprees.

I'd say the ability to steal money from SS is itself a pretty big flaw...

KCWolfman
02-13-2005, 09:36 PM
Maybe you aren't aware that the SS system was tweaked in the 80's to account for the main weakness (flaw). That flaw was an (as then funded) inability to handle a boomer population bubble.

Alan Greenspan (under Reagan) fixed that "flaw" by having the boomers (and future generations) advance-pay for their larger retirement needs via increased SS tax rates.

That "flaw" was fixed by the Republicans in 1984, IIRC.

Replacing SS with private accounts will replace one problem with another. That's not fixing a flawed system at all. It's moving around flaws under the cloak of political hocus pocus.
Tweaking is not a 600% increase. Using your reasoning, the percentage should decrease soon as those boomers will no longer be working and paying in.

Again, don't sh*t on my plate and tell me it is steak. Take the product back down to 2% or eliminate it altogether. It is not doing what it was originally designed to do. It is theft.

jAZ
02-13-2005, 09:39 PM
I'd say the ability to steal money from SS is itself a pretty big flaw...
I'd agree. One that can be corrected without tossing out the baby with the bath water.

Bootlegged
02-13-2005, 09:42 PM
Rep "the sky is blue"

jAZ "there is no sky"

jAZ
02-13-2005, 09:42 PM
Tweaking is not a 600% increase. Using your reasoning, the percentage should decrease soon as those boomers will no longer be working and paying in.
If Congress were to stop robbing the SS trustfund over the years, it would have successfully paid for those boomers through their bubble.

That politicans have (as Brad puts it) "stolen" from SS, is the failure of the current system. Not that it isn't made up of private accounts.

KCWolfman
02-13-2005, 09:42 PM
I'd agree. One that can be corrected without tossing out the baby with the bath water.
Or feeding the baby 6 times more than it needs while taking the food from other people.

KCWolfman
02-13-2005, 09:43 PM
If Congress were to stop robbing the SS trustfund over the years, it would have successfully paid for those boomers through their bubble.

That politicans have (as Brad puts it) "stolen" from SS, is the failure of the current system. Not that it isn't made up of private accounts.
Name to me one Federal taxation that has decreased in percentage that has not been fought by Dems over the last 20 years.

Tax levels don't decrease - and Liberals NEVER want a decrease anyway.

It ain't steak.

Rausch
02-13-2005, 09:43 PM
I'd agree. One that can be corrected without tossing out the baby with the bath water.

This would be one case when I'd be in favor of abortion...

WilliamTheIrish
02-13-2005, 10:06 PM
I'd say the ability to steal money from SS is itself a pretty big flaw...

The ability to steal money from my paycheck is itself the greater flaw.

Let's make it voluntary (again). As it was intended.

jAZ
02-13-2005, 10:41 PM
The ability to steal money from my paycheck is itself the greater flaw.

Let's make it voluntary (again). As it was intended.
Should we make all taxes voluntary? Or just ones that you wouldn't voluntarily pay?

Cochise
02-13-2005, 10:48 PM
:rolleyes:

BIG_DADDY
02-13-2005, 10:48 PM
And there's the real rub. Regardless of how you cast it, we created this problem for ourselves in the 80s, and the only way to repay those obligations is through massive tax increases or dramatic benefit reductions. Neither is either politically feasible or desireable.

The only thing left to us is to find another solutions that involves dramatically altering Social Security.

I also note that in the long, long run Social Security is doomed anyway. Maybe it's 100 years instead of 30, or whatever, but ultimately SS can't survive as it currently operates. Simply demographics tell us that much.

As long as there is no accountability which would involve personal accounts your right. Everything else is commu..........I mean socialis.... I mean jazilism.

WilliamTheIrish
02-13-2005, 10:50 PM
Should we make all taxes voluntary? Or just ones that you wouldn't voluntarily pay?

Don't twist my words RL.

jAZ
02-13-2005, 11:01 PM
Don't twist my words RL.
:D

I'm sure you understood that my question was part tongue-in-cheek and part an attempt to understand your underlying principle.

I won't be hurt if you ignored the TIC part and just explained your reasoning behind your statement about "stealing (your) money from (your) paycheck". I take that to mean taxes (which are mandatory as well).

WilliamTheIrish
02-14-2005, 12:26 AM
:D

I'm sure you understood that my question was part tongue-in-cheek and part an attempt to understand your underlying principle.

I won't be hurt if you ignored the TIC part and just explained your reasoning behind your statement about "stealing (your) money from (your) paycheck". I take that to mean taxes (which are mandatory as well).


Sorry dude, got busy at work. I'm home now and kinda sleepy. I'll catch up later..

RINGLEADER
02-14-2005, 10:15 AM
If Congress were to stop robbing the SS trustfund over the years, it would have successfully paid for those boomers through their bubble.

That politicans have (as Brad puts it) "stolen" from SS, is the failure of the current system. Not that it isn't made up of private accounts.


Amnorix and I already had this discussion. Social security became part of the overall budget during Lyndon Johnson's last year as a trick to help him achieve a balanced budget. The trust fund wasn't raided until 1985, however, when Reagan, the republican Senate and the Democratic House all agreed to a one-time dip into the surplus. The raiding continued, however, during 11 more years of Republican executive branch leadership and 8 years of Democratic executive branch leadership...during 10 more years of Democratic House control and 10 more years of Republican House control...during 7 more years of Democratic Senate control and 13 more years of Republican Senate control.

Still doesn't change the fact that under either scenario, in 2042, the system will require half-trillion dollar influxes each year to payout a full benefit, but other than that I agree entirely with your conclusion Jaz...as long as you agree with the fact that the raiding has been completely bi-partisan.

RINGLEADER
02-14-2005, 10:18 AM
Should we make all taxes voluntary? Or just ones that you wouldn't voluntarily pay?


ROFL

Well, the one consolation that I get in having these debates about social security with Jaz is knowing that if the private accounts are adopted to supplement social security payouts he'll be one of the few that decides to stick with the old system and it's negative returns. Unless, of course, he decides to change his mind on the issue again ;)

htismaqe
02-14-2005, 10:36 AM
:D

I'm sure you understood that my question was part tongue-in-cheek and part an attempt to understand your underlying principle.

I won't be hurt if you ignored the TIC part and just explained your reasoning behind your statement about "stealing (your) money from (your) paycheck". I take that to mean taxes (which are mandatory as well).

He was talking about SS withholding, not income taxes.

Amnorix
02-14-2005, 10:43 AM
Still doesn't change the fact that under either scenario, in 2042, the system will require half-trillion dollar influxes each year to payout a full benefit, but other than that I agree entirely with your conclusion Jaz...as long as you agree with the fact that the raiding has been completely bi-partisan.

As I pointed out in the prior thread, the '85 revisions that allowed the feds to raid the trust fund were immediately after Reagan's landslide victory. The Republicans, with "mandate in hand" and Mondale destroyed, pushed it through.

The raiding ahs been, IMHO, *mostly* (not entirely) Republican-driven.

Brock
02-14-2005, 10:43 AM
Guess that employment situation hasn't changed yet, jaz? How very unfortunate.

htismaqe
02-14-2005, 10:47 AM
Guess that employment situation hasn't changed yet, jaz? How very unfortunate.

Just keep paying your taxes.

He wants his check.

beavis
02-14-2005, 10:49 AM
I guess I'm confused, doesn't jAZ have another thread at the top of the page saying that SS isn't in trouble? I believe his words were something to the effect of "Republicans admit private accounts are about ideology not solvency"...

BIG_DADDY
02-14-2005, 10:54 AM
The system is flawed because people don't have their own account earning money like it should. The system is flawed because you have a bunch crooked politicians in charge of it.

beavis
02-14-2005, 10:54 AM
The system is flawed because people don't have their own account earning money like it should. The system is flawed because you have a bunch crooked politicians in charge of it.
The system is flawed because it shouldn't exist at all.

BIG_DADDY
02-14-2005, 11:03 AM
The system is flawed because it shouldn't exist at all.


I would give up everything I put into it if they would just trash the whole damn thing.

Cochise
02-14-2005, 11:06 AM
Add in my vote for scrapping the whole thing.

That is my only real problem with privatization. It should be abolished, not privatized. But... at least it would be better privatized than it is now.

redbrian
02-14-2005, 12:03 PM
The “Trust Fund” has never been raided. The overage collected since the FICA increase in the mid-80’s is not put into any true type of savings account. It is put into T-Bills (or IOU’s from the government, paying a very low rate of return). That money is added to the general funds and is spent. The meager interest rate paid on these funds is paid by taxes collected from the workers (in essence the workers are paying twice on SS).

Other governments also put their SS systems monies into American T-Bills (which means that not only are the worker of America paying twice for our SS but we are also paying for foreign workers SS).

This is the flaw with the system, 100% of all excess money is put into one source, always a very bad idea.

Will the US Government renege on these IOU’s of course not, they will just raise tax’s both FICA and Income to cover the short fall.

patteeu
02-15-2005, 08:24 AM
Maybe you aren't aware that the SS system was tweaked in the 80's to account for the main weakness (flaw). That flaw was an (as then funded) inability to handle a boomer population bubble.

Alan Greenspan (under Reagan) fixed that "flaw" by having the boomers (and future generations) advance-pay for their larger retirement needs via increased SS tax rates.

That "flaw" was fixed by the Republicans in 1984, IIRC.

Replacing SS with private accounts will replace one problem with another. That's not fixing a flawed system at all. It's moving around flaws under the cloak of political hocus pocus.

Maybe you aren't aware that your characterization is nonsense. Just as the baby boomers who are now approaching retirement will demand a surge in retirement benefits, so too did they create a surge in contributions. This surge in contributions was present BEFORE the so-called "fix" of the 80's. The "fix" you speak of was implemented to account for other demographic and systemic factors (e.g. increasing life expectancy, cost of living adjustments, etc.) and it wasn't anticipated to be a permanent fix. It was known to just defer the problem at the time it was adopted.

beavis
02-15-2005, 11:08 AM
I would give up everything I put into it if they would just trash the whole damn thing.
Same here dude. :clap:

RINGLEADER
02-16-2005, 11:21 AM
As I pointed out in the prior thread, the '85 revisions that allowed the feds to raid the trust fund were immediately after Reagan's landslide victory. The Republicans, with "mandate in hand" and Mondale destroyed, pushed it through.

The raiding ahs been, IMHO, *mostly* (not entirely) Republican-driven.

So the GOP made the Dems go along with this in 85-88? Daddy Bush and the GOP made the Dem congress continue this practice in 89-92? The GOP were responsible for Clinton and the Dem congress raiding the surpluses in 92-94 when the Dems controlled everything?

Congress controls the purse-strings, and by my count the Dems have controlled the House just as long as the GOP when this practice has taken place and has controlled the senate for four years more than the Dems.

If you're making the argument that the volume of money coming out has been more during GOP terms then there's no arguing the facts there. But I don't think anyone from either side of the partisan aisle has proposed a plan to curb the raiding in the last 20 years. They're both responsible.

Still wouldn't change the fact that in 2042 the system is going to be unable to function and, to insure a full benefit payout it will require a half-trillion dollar increase in the debt every year. Unless we adjust the COLA, the retirement age, the taxes being paid in, raise the taxable income threshold, or means-test the funds that are paid out.

Or we can allow a portion of the social security paid in to go into private accounts that earn more and use those funds to supplement whatever social security can pay out (whatever that number is that year).

RINGLEADER
02-16-2005, 11:25 AM
The “Trust Fund” has never been raided. The overage collected since the FICA increase in the mid-80’s is not put into any true type of savings account. It is put into T-Bills (or IOU’s from the government, paying a very low rate of return). That money is added to the general funds and is spent. The meager interest rate paid on these funds is paid by taxes collected from the workers (in essence the workers are paying twice on SS).

Other governments also put their SS systems monies into American T-Bills (which means that not only are the worker of America paying twice for our SS but we are also paying for foreign workers SS).

This is the flaw with the system, 100% of all excess money is put into one source, always a very bad idea.

Will the US Government renege on these IOU’s of course not, they will just raise tax’s both FICA and Income to cover the short fall.

I disagree with your statement that it hasn't been raided. That money is gone. In its place are IOUs. The only way to pay them back is to print more money. New taxes can't be applied directly against the already spent surpluses (although they can be applied to make up the difference). You either reneg on the IOUs or you add $5-6 trillion in additional debt paying them off.

RINGLEADER
02-16-2005, 11:28 AM
Maybe you aren't aware that your characterization is nonsense. Just as the baby boomers who are now approaching retirement will demand a surge in retirement benefits, so too did they create a surge in contributions. This surge in contributions was present BEFORE the so-called "fix" of the 80's. The "fix" you speak of was implemented to account for other demographic and systemic factors (e.g. increasing life expectancy, cost of living adjustments, etc.) and it wasn't anticipated to be a permanent fix. It was known to just defer the problem at the time it was adopted.

Jaz also ignores the fact that Greenspan now says that we should, ableit slowly, proceed with reforming the system in a way that will allow it to gain a better return. He likes to throw Greenspan's name out there but seems to ignore the fact that he is against the federal government running surpluses, that he is for social security reform including private accounts, and is opposed to other positions that Jaz seems to embrace.

Of course last year Jaz was also for private social security accounts, so go figure...

Amnorix
02-16-2005, 11:59 AM
So the GOP made the Dems go along with this in 85-88? Daddy Bush and the GOP made the Dem congress continue this practice in 89-92? The GOP were responsible for Clinton and the Dem congress raiding the surpluses in 92-94 when the Dems controlled everything?

Congress controls the purse-strings, and by my count the Dems have controlled the House just as long as the GOP when this practice has taken place and has controlled the senate for four years more than the Dems.

If you're making the argument that the volume of money coming out has been more during GOP terms then there's no arguing the facts there. But I don't think anyone from either side of the partisan aisle has proposed a plan to curb the raiding in the last 20 years. They're both responsible.

Still wouldn't change the fact that in 2042 the system is going to be unable to function and, to insure a full benefit payout it will require a half-trillion dollar increase in the debt every year. Unless we adjust the COLA, the retirement age, the taxes being paid in, raise the taxable income threshold, or means-test the funds that are paid out.

Or we can allow a portion of the social security paid in to go into private accounts that earn more and use those funds to supplement whatever social security can pay out (whatever that number is that year).

As you know, once that particular gate was unlocked, there was never really any chance of going back. At least not until we had essentially eliminated the debt -- which was hardly possible as Republican administrations were primarily focused on lowering taxes without any concommitant lowering of spending.

RINGLEADER
02-16-2005, 12:10 PM
As you know, once that particular gate was unlocked, there was never really any chance of going back. At least not until we had essentially eliminated the debt -- which was hardly possible as Republican administrations were primarily focused on lowering taxes without any concommitant lowering of spending.


Well, if by "administration" you mean the executive branch there is really no way that you can lower spending. That's the job of congress until the line-item veto is passed and upheld as constitutional.

I'm not debating that the GOP stinks on this issue...I just don't think they stink any less than the Dems who first incorporated the trust funds into the general budget and then did nothing to stop the one-year raiding in 85, nor did they do anything to stop it between 88 and 94 when they controlled both houses of congress.

jAZ
02-17-2005, 07:19 AM
Well, if by "administration" you mean the executive branch there is really no way that you can lower spending. That's the job of congress until the line-item veto is passed and upheld as constitutional.

I'm not debating that the GOP stinks on this issue...I just don't think they stink any less than the Dems who first incorporated the trust funds into the general budget and then did nothing to stop the one-year raiding in 85, nor did they do anything to stop it between 88 and 94 when they controlled both houses of congress.
Of course it's bi-partisan.

That's why fixing it and the indexing for future payouts should be our top priority... not spending 5 trillion dollars to switch to PA.

ck_IN
02-19-2005, 09:53 AM
You're right on the first count but dead wrong on the second.

Politicians from both sides of the asle have raided SS for as long as it's been in existance. Previously it wasn't a problem because there were 12 workers paying in for every reciepent. Now the ratio is about 2-1.

On the second count, SS is a clasic Ponzi scheme. It's worked for as long as it has simply because of numbers. However all Ponzi schemes eventually fail due to the numbers catching up and SS is no different.

Personal accounts is the only way to save some semblence of the system in the long term. The longer we wait, the more it will cost to implement.

Calcountry
02-19-2005, 10:48 AM
Jaz, it is in a bind because of abortion on demand, fewer taxpayers have grown up.

And, transfer payments to illegal immigrants who haven't paid into the system.

redbrian
02-19-2005, 10:58 AM
I disagree with your statement that it hasn't been raided. That money is gone. In its place are IOUs. The only way to pay them back is to print more money. New taxes can't be applied directly against the already spent surpluses (although they can be applied to make up the difference). You either reneg on the IOUs or you add $5-6 trillion in additional debt paying them off.

The money was always in "IOUs" in the form of T-Bills.

The interest paid on the T-Bills is generated by taxes.

There never was, never has been and probably never will be a true trust fund.

jAZ
02-19-2005, 11:13 AM
The money was always in "IOUs" in the form of T-Bills.

The interest paid on the T-Bills is generated by taxes.

There never was, never has been and probably never will be a true trust fund.
That's a truely odd perspective...

So if you invest money (in T-Bills, stocks, etc) while it's in the "trust fund", then that means that there is no "trust fund"?

Does that also mean that if you invest the money in your 401K, then it is merely filled with "IOUs"? And does that then mean that PA's are just a different form of a worthless trust fund?

jAZ
02-19-2005, 11:17 AM
Jaz also ignores the fact that Greenspan now says that we should, ableit slowly, proceed with reforming the system in a way that will allow it to gain a better return. He likes to throw Greenspan's name out there but seems to ignore the fact that he is against the federal government running surpluses, that he is for social security reform including private accounts, and is opposed to other positions that Jaz seems to embrace.

Of course last year Jaz was also for private social security accounts, so go figure...
Your endless lies are just not worth correcting anymore.

How do you not vomit when you look in the mirror each morning?

Someone as shallow as you, who will say anything they can get away with in order to feel like you've won an debate... should have reached the dry heaves by now.

redbrian
02-19-2005, 11:26 AM
That's a truely odd perspective...

So if you invest money (in T-Bills, stocks, etc) while it's in the "trust fund", then that means that there is no "trust fund"?

Does that also mean that if you invest the money in your 401K, then it is merely filled with "IOUs"? And does that then mean that PA's are just a different form of a worthless trust fund?

Are you really this stupid?

Where do you think the money goes from the purchase of T-Bills?

401’s are (usually) a mix of Stocks and Bonds.

Stocks are documents which show ownership in companies, which actually produce products, when companies are perceived to do well their stock prices go up.

jAZ
02-19-2005, 11:41 AM
Are you really this stupid?

Where do you think the money goes from the purchase of T-Bills?

401’s are (usually) a mix of Stocks and Bonds.

Stocks are documents which show ownership in companies, which actually produce products, when companies are perceived to do well their stock prices go up.
Apparently you must be if you are trying to tell me that T-Bills are a riskier investment than stock.

http://www.investopedia.com/university/moneymarket/moneymarket2.asp
T-bills (and all treasuries) are considered to be the safest investments in the world because the U.S. government backs them. In fact, they are considered risk-free.

But don't let the fact that the T-Bill rate is used as the "risk-free" by every Financial Analyst in the world stop you from looking silly.

Also don't let the fact that Bush will have to convince MORE investors to buy T-Bills in order to finance the $2-5 TRILLION he wants to spend to transition to PA's.

If T-Bills are nothing more than "IOUs" then Bush is about to scam a ton of money from the American public and the investing community.

Quite a catch-22 you have boxed yourself into.

KCWolfman
02-19-2005, 12:26 PM
Apparently you must be if you are trying to tell me that T-Bills are a riskier investment than stock.

http://www.investopedia.com/university/moneymarket/moneymarket2.asp


But don't let the fact that the T-Bill rate is used as the "risk-free" by every Financial Analyst in the world stop you from looking silly.

Also don't let the fact that Bush will have to convince MORE investors to buy T-Bills in order to finance the $2-5 TRILLION he wants to spend to transition to PA's.

If T-Bills are nothing more than "IOUs" then Bush is about to scam a ton of money from the American public and the investing community.

Quite a catch-22 you have boxed yourself into.
So what you are saying is that IF I am allowed to invest MY OWN money that is currently stolen from SS I can invest in TBills with no risk?

Quite a catch-22 you have boxed yourself into.

jAZ
02-19-2005, 12:40 PM
So what you are saying is that IF I am allowed to invest MY OWN money that is currently stolen from SS I can invest in TBills with no risk?

Quite a catch-22 you have boxed yourself into.
Why a catch 22? Certainly you can invest in T-Bills. Is this another pointless attempt at a "gotcha" or are you saying something meaningful?

KCWolfman
02-19-2005, 01:00 PM
Why a catch 22? Certainly you can invest in T-Bills. Is this another pointless attempt at a "gotcha" or are you saying something meaningful?
Cool, give me back my 12% and let me do so. You stated there is no risk, so I see no issue.

jAZ
02-19-2005, 02:57 PM
Cool, give me back my 12% and let me do so. You stated there is no risk, so I see no issue.
Well there's always the risk that you will blow it on hookers and booze instead of T-Bills.

Garcia Bronco
02-19-2005, 04:08 PM
SS sucks and I curse the generation that allowed it to start.

KCWolfman
02-19-2005, 04:19 PM
Well there's always the risk that you will blow it on hookers and booze instead of T-Bills.
I can live with that chance. After all, you are willing to take money from everyone else to pay my way after my bad decisions.

jAZ
02-19-2005, 05:53 PM
I can live with that chance. After all, you are willing to take money from everyone else to pay my way after my bad decisions.
Only because prior planning prevents piss poor performance.

redbrian
02-20-2005, 07:32 AM
Apparently you must be if you are trying to tell me that T-Bills are a riskier investment than stock.

http://www.investopedia.com/university/moneymarket/moneymarket2.asp


But don't let the fact that the T-Bill rate is used as the "risk-free" by every Financial Analyst in the world stop you from looking silly.

Also don't let the fact that Bush will have to convince MORE investors to buy T-Bills in order to finance the $2-5 TRILLION he wants to spend to transition to PA's.

If T-Bills are nothing more than "IOUs" then Bush is about to scam a ton of money from the American public and the investing community.

Quite a catch-22 you have boxed yourself into.

Are you purposely being obtuse?

I never stated that T-Bills and Stocks carry the same risk factor.

Stocks outperform T-Bills because there is a risk. If you cannot handle risk and are satisfied with a very meager return then stick all of your money into T-Bills.

However if you build a balanced portfolio with all levels of risk you will outperform T-Bills by a large margin.

And again you fail to address the fact that the interest paid on T-Bills comes from taxes and that the excess money collected since 1983 was never placed into a “Trust Fund”, which actually created wealth, or for that matter could be raided.

As far as foreign governments placing their money into US T-Bills goes, that’s just plain smart on their part. Let the American tax payers pay the interest, instead of their own workers.

jAZ
02-20-2005, 06:18 PM
Are you purposely being obtuse?

I never stated that T-Bills and Stocks carry the same risk factor.

Stocks outperform T-Bills because there is a risk. If you cannot handle risk and are satisfied with a very meager return then stick all of your money into T-Bills.

However if you build a balanced portfolio with all levels of risk you will outperform T-Bills by a large margin.

And again you fail to address the fact that the interest paid on T-Bills comes from taxes and that the excess money collected since 1983 was never placed into a “Trust Fund”, which actually created wealth, or for that matter could be raided.

As far as foreign governments placing their money into US T-Bills goes, that’s just plain smart on their part. Let the American tax payers pay the interest, instead of their own workers.
And you totally ignore the fact that the SS trust fund is either worthless (because it is filled with worthless IOU's in the form of worthless T-Bills), or those T-Bills aren't worthless at all.

If they are indeed worthless, as you try to suggest, then we need to notify future T-Bill buyers that they are being scammed by the Bush Administration. Unfortunately, in that case, the Bush Administration can't declare that, because they NEED people to buy more T-Bills to finance their shift from SS to PA's.

A masterful dilemma you've created for yourself with your line of reasoning.

Just give up the ghost and admit that the SS trust fund is merely invested in the safest (lowest risk) investment in the world. A far cry from worthless IOUs.

Then you can go about defending the merits of PA's.

redbrian
02-21-2005, 08:33 AM
And you totally ignore the fact that the SS trust fund is either worthless (because it is filled with worthless IOU's in the form of worthless T-Bills), or those T-Bills aren't worthless at all.

If they are indeed worthless, as you try to suggest, then we need to notify future T-Bill buyers that they are being scammed by the Bush Administration. Unfortunately, in that case, the Bush Administration can't declare that, because they NEED people to buy more T-Bills to finance their shift from SS to PA's.

A masterful dilemma you've created for yourself with your line of reasoning.

Just give up the ghost and admit that the SS trust fund is merely invested in the safest (lowest risk) investment in the world. A far cry from worthless IOUs.

Then you can go about defending the merits of PA's.

I never stated that the T-Bills are worthless, what I am implying is that they are a bad deal for the American public.
The American Tax payers are essentially paying twice for the same thing.
T-Bill do not create wealth. The interest earned by T-Bills is paid for by taxes.
The US Government will honor the T-Bills on the backs of the tax payers.
A T-Bill is nothing short of robbing Peter (twice) to pay Paul.

Lefty_the_Right
02-21-2005, 10:01 AM
Um, China is buying T-bills like crazy right now.

You know, to pay for the deficit that Bush is running?

The funny part to me is all the "pro-lifers" that shop at WallMart.

They don't seem to realize that in voting for Bush because of the abotion issue, they are paying China twice.

Once when they shop at WallMart, and again when their taxes go up to pay for the deficit.

And then China used thier money to pay for forced abortions.

I think the name in the old days was a "rube"?

Calcountry
02-21-2005, 11:46 AM
Um, China is buying T-bills like crazy right now.

You know, to pay for the deficit that Bush is running?

The funny part to me is all the "pro-lifers" that shop at WallMart.

They don't seem to realize that in voting for Bush because of the abotion issue, they are paying China twice.

Once when they shop at WallMart, and again when their taxes go up to pay for the deficit.

And then China used thier money to pay for forced abortions.

I think the name in the old days was a "rube"?Man, I am gonna have to find somewheres else to by my asswipes now.

Lefty_the_Right
02-21-2005, 11:51 AM
Only if you care about the deficit and abortions in China.

If not, shop away!

redbrian
02-21-2005, 01:48 PM
Um, China is buying T-bills like crazy right now.

You know, to pay for the deficit that Bush is running?

The funny part to me is all the "pro-lifers" that shop at WallMart.

They don't seem to realize that in voting for Bush because of the abotion issue, they are paying China twice.

Once when they shop at WallMart, and again when their taxes go up to pay for the deficit.

And then China used thier money to pay for forced abortions.

I think the name in the old days was a "rube"?

And this is germane to the SS conversation in what way?

Lefty_the_Right
02-21-2005, 01:55 PM
redbrain wrote: And this is germane to the SS conversation in what way?

T-bills finance our debt, China is buying our T-bills with the money they get from supplying WallMart.

Bushies are paying for their own destruction.
And the destruction of SS.


Glad I could help.

redbrian
02-21-2005, 02:07 PM
T-bills finance our debt, China is buying our T-bills with the money they get from supplying WallMart.

Bushies are paying for their own destruction.
And the destruction of SS.


Glad I could help.

Ok, not really sure what your point is but then I doubt if you do either.

lardass
02-21-2005, 02:36 PM
Social Security is in trouble because from day one at it's best it was a glorified pyramid scheme.

redbrian
02-21-2005, 02:45 PM
Social Security is in trouble because from day one at it's best it was a glorified pyramid scheme.

You hit the proverbial nail on the head.

And not only is it a pyramid scheme it is one that is rigged from the start.

For example a single worker who starts working at age 16 and dies at age 61, will have paid in 180 qtr’s of FICA and receive zero in return.
In other words the single workers surviving family (i.e. brother, sisters, parents) will receive nothing, the government keeps 100% of all payments.

lardass
02-21-2005, 02:58 PM
There are numerous bad examples of why the system is garbage, even in its early days; it had some really horrible examples. Quite a few workers worked a really short period of time, paid little into the system and then retired quickly and qualified for benefits that they received for 20-30 years. The system is outdated, it has been abused and ultimately it was never intended to be anything more than a subsidy. It is the only "investment" I know that loses 400% over a 30 year period. Everyone would be much better off sticking their money under a mattress for 30 years, even with the time value of money figured in. Unfortunately the lame ass accountant in me is showing through. :)

NaptownChief
02-21-2005, 03:30 PM
It is a POS system that was nothing more than a heavy tax sold by Democrats as a "I'm here to help you" political rhetoric.

When SS was put into place nobody was eligible until age 65 when the average life expectancy was 59...It was nothing more than a tax that turned into a mess.

redbrian
02-22-2005, 07:37 AM
Jaz and et al read this and then explain to me why T-Bills are such a great deal for the SS system.


Posted on Tue, Feb. 22, 2005

Myth of trust fund is obstacle to reform

E. THOMAS MCCLANAHAN


If President Bush is to win approval for his plan to restructure Social Security, he must first destroy the still-widespread belief that the program — thanks to its trust fund — will remain solvent until 2042.

Like an urban myth, you run across this falsehood everywhere, frequently from sources who ought to know better. The latest was a column by Lou Dobbs of CNN in U.S. News (a portion of which was excerpted Monday in The Star).

Dobbs doesn't like the idea of personal accounts, which Bush favors. That's a subject for another day. But consider what Dobbs says about Social Security's capacity to pay benefits.

“In 1997, the Social Security trustees projected the trust fund would be exhausted in 2029, but over the past seven years, that date has been pushed back 13 years.” What's the rush? he says. The trust fund will keep things on an even keel until 2042.

Even Bush himself has muddied the waters on this score, as when he said the trust fund won't go bankrupt until the same year.

AARP, the nation's largest advocacy group for seniors, doesn't merely confuse the issue. Its assertions are downright misleading. AARP says Social Security can “pay 100 percent of benefits well into the 2040s and over 70 percent of benefits after that.”

Even The Wall Street Journal's news columns have parroted this myth. In a piece published earlier this month (and reprinted in The Star), David Wessel wrote, “Today, Social Security collects more in taxes than it spends in benefits. It invests the surplus in U.S. Treasury bonds to be cashed in when the big baby boom generation retires, a way of prefunding their benefits.”

Prefunding? Hardly. Yes, the trust fund is stashed with Treasury bonds. Yes, they earn interest. Yes, they have to be honored. But this is the accounting equivalent of writing IOUs to yourself instead of saving for your child's education. You couldn't take those IOUs to some financial institution and cash them in for real money. Neither can the Social Security trust fund.

From the point of view of the trust fund, the Treasury bonds are assets. But from the point of view of the government as a whole, they're liabilities: something for which payments are due.

Here's what the Clinton administration's budget for the year 2000 had to say about the trust fund. Regular readers of this column have seen this quote several times, but it can't be repeated too often.

“Trust Fund balances are available to finance future benefit payments … but only in a bookkeeping sense … They do not consist of real economic assets that can be drawn down in the future to fund benefits. Instead, they are claims on the Treasury that … will have to be financed by raising taxes, borrowing from the public or reducing benefits or other expenditures. The existence of large Trust Fund balances, therefore, does not, by itself, have any impact on the Government's ability to pay benefits.”

June O'Neill, former director of the Congressional Budget Office, noted that the trust fund bonds “do not provide the government as a whole with additional resources, as is the case when a private individual pays taxes. The investments are merely records of transfers from one part of the government to another.”

The date that matters is not 2042, but 2018 — 13 years from now. That's when Social Security becomes insolvent as the term is commonly understood, meaning it will be unable to fully pay its obligations. In the first year, its deficit won't be especially large by Washington standards, but it will grow rapidly: $15 billion in 2018 (in 2004 dollars); $101 billion in 2022; $203 billion in 2027 …

The coming political battle over Social Security will be one of the most important in recent memory. For Bush, success is hardly assured. But advocates of reform can be comforted in the knowledge that many opponents have adopted a strategy that depends on perpetuating the false impression that the trust fund contains “real economic assets that can be drawn down …”

This is actually a good sign for reformers. Your chances of winning a big political debate are always higher when your opponents rely on assertions that are inaccurate.

True, some peddlers of the trust-fund myth are not purposely trying to mislead. Wessel of The Wall Street Journal, for example, later wrote that “as several readers have reminded me, the government will have to get the money to pay back those IOUs …”

But others, such as AARP, are bent on stopping reform no matter what, and they're not especially careful with the facts. The tooth-fairy trust fund is AARP's alibi, its excuse to stall reform.

The Treasury bonds have to be redeemed. They are backed by the “full faith and credit …” etc. But AARP — and many others bent on thwarting reform — have little to say about the consequences of the huge tax increases and budget cuts needed to redeem those bonds, and what that portends for younger workers and the economy as a whole.

Lefty_the_Right
02-22-2005, 12:06 PM
If Bush was running an honest budget, none of this would be an issue.

When you cut taxes and drive up the deficit, you aren't operating on a sound economic policy.

But that was the intent all along.

Drive up the deficit in order to destroy the New Deal.

And you guys are willing patsies.

KCFalcon59
02-22-2005, 01:05 PM
If Bush was running an honest budget, none of this would be an issue.

When you cut taxes and drive up the deficit, you aren't operating on a sound economic policy.

But that was the intent all along.

Drive up the deficit in order to destroy the New Deal.

And you guys are willing patsies.

Taxing us to death isn't sound economic policy.

Lefty_the_Right
02-22-2005, 01:17 PM
Running a billion dollars in deficits isn't either.

redbrian
02-22-2005, 01:21 PM
If Bush was running an honest budget, none of this would be an issue.

When you cut taxes and drive up the deficit, you aren't operating on a sound economic policy.

But that was the intent all along.

Drive up the deficit in order to destroy the New Deal.

And you guys are willing patsies.

So I guess you can’t logically justify funding the “SS Trust” fund with T-Bills, so you bring up irrelevant arguments.

You do know that the SS system started to bring in more money than it spent back in the 80’s don’t you. And you do know that this was done with an increase in the FICA withholdings.

So for close to 20 years the government has been issuing T-Bills for the overage that it has collected.

From a liberal stand point defend this as fiscally sound practice.

And do so without bringing up Bush as he was not president back in the 80’s when this policy went into practice.

Lefty_the_Right
02-22-2005, 01:29 PM
I thought that the US debt was based on T-bills, not SS?

If the government borrows from SS to pay other bills, it still owes money, and that is paid for by selling T-bills, right?

I think you are mixing the two issues into one?

Lefty_the_Right
02-22-2005, 01:30 PM
So if Bush wasn't running massive deficits, plus keeping billions off budget, this wouldn't even be an issue, would it?

KCFalcon59
02-22-2005, 03:14 PM
Running a billion dollars in deficits isn't either.

If it keeps me and my family safe I am all for it. Government should never be allowed to have more than 5% of anything I earn. And that is way too ****ing much.

Lefty_the_Right
02-22-2005, 03:35 PM
Your governemnt has spent billions on the war on drugs.

Can your kinds find drugs at school?

redbrian
02-23-2005, 07:47 AM
I thought that the US debt was based on T-bills, not SS?

If the government borrows from SS to pay other bills, it still owes money, and that is paid for by selling T-bills, right?

I think you are mixing the two issues into one?

I’ll take this real slow so that maybe you will get it this time.

Since the early 80’s the government has been taking in more SS money than it has paid out.

This is due to an increase in the percentage of SS money taken out of the workers paycheck and the employers matching.

The reason for this was to build a “trust fund” to help pay for the baby boomers SS retirement.

This excess money is (and was) put into T-Bills.

Which simply means their never has been a stash of money (Trust Fund), for the government to raid.

The excess money from day one has been spent.

When it comes time to draw into these T-Bills, the money (including interest) will come from the tax payers.

Understand or is this too complex for you.

Amnorix
02-23-2005, 08:05 AM
Running a billion dollars in deficits isn't either.

If only it was "a" billion....

Amnorix
02-23-2005, 08:10 AM
I thought that the US debt was based on T-bills, not SS?

If the government borrows from SS to pay other bills, it still owes money, and that is paid for by selling T-bills, right?

I think you are mixing the two issues into one?

Social Security financing in a nutshell:

1. The main (i.e. core) federal budget is massively in the red. For example's sake, let's say they spend $100, but only take in $50 in taxes.

2. Social Security runs in the black. For example's sake, let's say it makes a $20 profit per year.

What happens is Social Security "loans" the $20 to the Treasury. The Treasury technically issues Social Security a note saying it owes SS $20, which carries interest. The Treasury then goes and borrows the other $30 it needs in the public market. $50 (taxes) + $20 (borrowed from SS) + $30 (borrowed from the public) = $100 and that pays for its costs.

The reality, of course, is that this is like your right pocket telling your left pocket that it needs money, so you move the money over. Your right pocket says it'll pay the left pocket back, with interest. The right pocket buys a candy bar.

Next week, the right pocket and the left pocket both want to spend more money than they make, so how is the right pocket going to pay the left pocket anything??

Amnorix
02-23-2005, 08:14 AM
When it comes time to draw into these T-Bills, the money (including interest) will come from the tax payers.


And this is the ultimate problem. There is no trust fund, and the same group of people, more or less, (US taxpayers) are going to be expected to "repay" the loans the federal government has gotten from Social Security.

It's a big joke, committed in 1985, by Reagan and his cohorts who were desperate to make the massive red ink they were spilling all over the federal budget a little less red.

The '85 SS reform was good, overall, but bringing SS onto the budget was just an accounting game meant to hide reality from the public.

redbrian
02-23-2005, 08:21 AM
Social Security financing in a nutshell:

1. The main (i.e. core) federal budget is massively in the red. For example's sake, let's say they spend $100, but only take in $50 in taxes.

2. Social Security runs in the black. For example's sake, let's say it makes a $20 profit per year.

What happens is Social Security "loans" the $20 to the Treasury. The Treasury technically issues Social Security a note saying it owes SS $20, which carries interest. The Treasury then goes and borrows the other $30 it needs in the public market. $50 (taxes) + $20 (borrowed from SS) + $30 (borrowed from the public) = $100 and that pays for its costs.

The reality, of course, is that this is like your right pocket telling your left pocket that it needs money, so you move the money over. Your right pocket says it'll pay the left pocket back, with interest. The right pocket buys a candy bar.

Next week, the right pocket and the left pocket both want to spend more money than they make, so how is the right pocket going to pay the left pocket anything??

A very nice analogy.

I would only add one thing, the right pocket (read congress) set up the rules so that the left pocket (ss) could only put any money it has at the end of the month (after paying out it’s obligations) into the right pocket (in other words the left pocket must zero out at the end of the month), and not into a fund which would actually create wealth.

redbrian
02-23-2005, 08:26 AM
And this is the ultimate problem. There is no trust fund, and the same group of people, more or less, (US taxpayers) are going to be expected to "repay" the loans the federal government has gotten from Social Security.

It's a big joke, committed in 1985, by Reagan and his cohorts who were desperate to make the massive red ink they were spilling all over the federal budget a little less red.

The '85 SS reform was good, overall, but bringing SS onto the budget was just an accounting game meant to hide reality from the public.

If they would have created a balanced portfolio of T-Bills, domestic / foreign bonds and stocks, the SS would be loaded with money.

Of course this would never happen because no Congressman or President regardless of party affiliation wants to lose its grasp on that big nut.

Amnorix
02-23-2005, 09:23 AM
If they would have created a balanced portfolio of T-Bills, domestic / foreign bonds and stocks, the SS would be loaded with money.

Of course this would never happen because no Congressman or President regardless of party affiliation wants to lose its grasp on that big nut.

I agree that SS would have made more profit if it had been invested in something more than T-bills. I note the following:

1. It'd be political lightning to "risk putting our future into the hands of a speculative stock market" (or whatever the opponents would have plastered all over television, etc., for their political gain); and

2. I honestly don't remember, but I seem to think that even Greenspan was opposed to just investing SS in the stock market due to concerns about the impact pumping so much money into the market would have. You certainly don't want to create a situation where the feds are falsely inflating market prices for stock, etc.

Finally, I have no idea how the Feds would decide WHAT to invest in. You certainly would have to be worried about putting that kind of power to manipulate the market into the hands of any one person, or small group of people. I assume maybe the SS money would be invested according to market weight across the entire Russell 3000, say, or something, in order to avoid some of these complications. But it's not as easy as "just do it".

redbrian
02-23-2005, 10:53 AM
I agree that SS would have made more profit if it had been invested in something more than T-bills. I note the following:

1. It'd be political lightning to "risk putting our future into the hands of a speculative stock market" (or whatever the opponents would have plastered all over television, etc., for their political gain); and

2. I honestly don't remember, but I seem to think that even Greenspan was opposed to just investing SS in the stock market due to concerns about the impact pumping so much money into the market would have. You certainly don't want to create a situation where the feds are falsely inflating market prices for stock, etc.

Finally, I have no idea how the Feds would decide WHAT to invest in. You certainly would have to be worried about putting that kind of power to manipulate the market into the hands of any one person, or small group of people. I assume maybe the SS money would be invested according to market weight across the entire Russell 3000, say, or something, in order to avoid some of these complications. But it's not as easy as "just do it".

You just made the case for allowing the worker to “own” a portion of their SS.

Amnorix
02-23-2005, 11:02 AM
You just made the case for allowing the worker to “own” a portion of their SS.

Perhaps so, but I can honestly say that I'm not sure I understand why the government is interested in creating a "forced savings plan", which is what this essentially turns out to be.

I have, however, repeatedly stated that I'm wildly in favor of nearly any changes to Social Security to improve its long term viability, and/or replace or eliminate it. It simply cannot continue as it has been.

redbrian
02-23-2005, 11:13 AM
Perhaps so, but I can honestly say that I'm not sure I understand why the government is interested in creating a "forced savings plan", which is what this essentially turns out to be.

I have, however, repeatedly stated that I'm wildly in favor of nearly any changes to Social Security to improve its long term viability, and/or replace or eliminate it. It simply cannot continue as it has been.

The reason to force Americans to save is because as a whole we suck at putting money away.

Historicly Americans don't save squat.

Amnorix
02-23-2005, 01:09 PM
The reason to force Americans to save is because as a whole we suck at putting money away.

Historicly Americans don't save squat.

I agree with as a fact, but as liberal as I am, I'm uncertain that the government should be specifically allocating our income for us...

I'd like to save some vestige of Social Security, as I'm concerned about a bunch of homeless 80 year olds, but I don't pretend I have the answers. Social Security has been fantastically successful since it was implemented 70 or so years ago, but it can't continue as it has.

KCWolfman
02-23-2005, 04:42 PM
The reason to force Americans to save is because as a whole we suck at putting money away.

Historicly Americans don't save squat.
I disagree. We were wonderful with it prior to SS, credit cards, and instant gratification after WWII.

Homes were purchased in a decade, not 30. Car loans were non-existent. People didn't buy crap we buy today to pay 19% interest annually along with a 25.00 a year fee.

Historically Americans abuse their toys - which is what we have done with credit and SS. We spend like mad because we believe the government will hold our hands after our bad decisions.

Amnorix
02-23-2005, 05:30 PM
I disagree. We were wonderful with it prior to SS, credit cards, and instant gratification after WWII.

This isn't too different from saying we were good drivers before they invented cars...

KCWolfman
02-23-2005, 05:32 PM
This isn't too different from saying we were good drivers before they invented cars...
You parsed a single topic from the entire subject. As long as we are willing to finance 50k or more just for a vehicle, we deserve the long term effects of our decisions. Unfortunately, due to those decisions in tandem with government "grants" like SS, we expect our 53K car AND our government minded retirement when we are done driving that car.

Americans have not always been fiscally irresponsible. That is a phenom that started with the baby boomers.

Amnorix
02-23-2005, 05:44 PM
You parsed a single topic from the entire subject. As long as we are willing to finance 50k or more just for a vehicle, we deserve the long term effects of our decisions. Unfortunately, due to those decisions in tandem with government "grants" like SS, we expect our 53K car AND our government minded retirement when we are done driving that car.

Americans have not always been fiscally irresponsible. That is a phenom that started with the baby boomers.

Prior to World War II, we had a pretty thin middle class. Mainly, America consisted of the wealthy, the scrimping by, the pathetically poor, and farmers (who may or may not have been in one of the above categories, but tended not to be frivolous people).

Parents almost invariably moved in with their kids (or had their kids move back in with them) after they retired. People tended to live in the same place their whole life alot more.

I mean, EVERYTHING was different. You're extrapolating that Social Security causes poor saving habits. I personally think it's absurd that a 30 year old overspending has in the back of his mind "well, I'll have SS so I'm all set."

Boozer
02-23-2005, 05:50 PM
I agree with as a fact, but as liberal as I am, I'm uncertain that the government should be specifically allocating our income for us...

I'd like to save some vestige of Social Security, as I'm concerned about a bunch of homeless 80 year olds, but I don't pretend I have the answers. Social Security has been fantastically successful since it was implemented 70 or so years ago, but it can't continue as it has.

Means testing. I would imagine a means tested social program for the elderly would be harder to demonize than one for young mothers.

Amnorix
02-23-2005, 05:58 PM
Here's 222 pages of exciting demographic statistics that you could lose yourself in for a week or so...

http://www.census.gov/prod/2002pubs/censr-4.pdf

A Few highlights (from pages 120-135 or so):

In 1900, the most common household size was 7 people. Now it's 2.

Average household size went from 4.60 in 1900 to 2.59 in 2000 (decline of 44%).

In every census from 1970 to 2000, approximately 3 out of every 4 women over 65 lived alone.

In 1900, nearly half of the US population lived in a household with 6 or more people. In 2000, nearly half of the US population lived in a household with 1, 2 or 3 people.

In 1900, less than half of occupied housing units were owner-occupied (7.2 million out of 16 million households)(i.e. more than half were rented by their occupants). In 2000 nearly 2/3rds of households were owner-occupied (70 million out of 105 million). KEEP in mind the persons per household number here, and you'll see that there has been a tremendous boom in home ownership. More people live in houses they own, and live in them with fewer of their relatives (rather than more relatives crammed into rental housing).

All this stuff impacts what we're talking about in myriad ways.

Amnorix
02-23-2005, 06:00 PM
Means testing. I would imagine a means tested social program for the elderly would be harder to demonize than one for young mothers.

Yeah, but then we invite all kinds of games regarding income, assets, etc. Americans have historically been opposed to producing a schedule of their net worth to someone, especially the feds. 'bout the only time we require it now is when you file for bankruptcy, certain other programs, or die...

KCWolfman
02-23-2005, 06:01 PM
I mean, EVERYTHING was different. You're extrapolating that Social Security causes poor saving habits. I personally think it's absurd that a 30 year old overspending has in the back of his mind "well, I'll have SS so I'm all set."

No, a 30 year old sees that he can buy a 30k car instead of a 12k that will do the exact same thing because he sees very little repercussions from others who are older than him and have spent the same.

Again, you are parsing a single unit from my topic. It isn't just SS, it is a base mentality that someone else will take care of everything.

Amnorix
02-23-2005, 06:08 PM
No, a 30 year old sees that he can buy a 30k car instead of a 12k that will do the exact same thing because he sees very little repercussions from others who are older than him and have spent the same.

Again, you are parsing a single unit from my topic. It isn't just SS, it is a base mentality that someone else will take care of everything.

I agree that my generation (30s) has a spoiled and selfish mentality for the most part. I don't know the root causes of it. I know some who are "savers" and some who are spendthrifts, and the mentalities don't seem too tied to income, party affiliation or education.

I think, ultimately, that these mentalities existed in prior generations as well, but before credit cards, especially, people had little capacity to spend themselves into debt. After all, buying a house required saving quite a bit in advance.

KCWolfman
02-23-2005, 06:11 PM
People had little capacity to spend themselves into debt. After all, buying a house required saving quite a bit in advance.
As I said, instant gratification society.

Amnorix
02-23-2005, 06:21 PM
As I said, instant gratification society.

Okay, we agree. How do we fix it?

(I actually need to leave this discussion for now, but... :) )

Calcountry
02-23-2005, 06:27 PM
I agree that my generation (30s) has a spoiled and selfish mentality for the most part. I don't know the root causes of it. I know some who are "savers" and some who are spendthrifts, and the mentalities don't seem too tied to income, party affiliation or education.

I think, ultimately, that these mentalities existed in prior generations as well, but before credit cards, especially, people had little capacity to spend themselves into debt. After all, buying a house required saving quite a bit in advance.A spendthrift a day, keeps bankruptcy away, for me and other businesses that is.

KCWolfman
02-23-2005, 06:55 PM
Okay, we agree. How do we fix it?

(I actually need to leave this discussion for now, but... :) )
We can't. Like the pendulum analogy, fiscal responsibility will swing back when it starts to bite us in the ass, around retirement age. Unfortunately, those too stupid to plan now will be out in the cold and future generations will wonder why we were so stupid to waste so much on so little.