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runningdude
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So the solution is?
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shockerfan
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It is a ponzi scheme, and a similar scheme put Madoff in jail. 1) Perhaps letting people choose for themselves what to do with what is supposedly their money. 2) Immigrants do not get full benefits. My understanding is that in the UK (correct me if I’m wrong) immigrants get 1/30th of a share of their equivalent program for each year they are a citizen…thus after 30 years of paying in, they would get a full share. 3) actually put money into an actual account for SS…not let politician steal it to spend it on vote buying schemes.
I’m sure there are other ideas, these are just to get started.
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bbarrick8383
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Adios social security number. :tiphat:
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sw85
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If what Denninger writes is true, clearly there isn’t one. We ought to simply buck up, acknowledge that SS is bankrupt, and get on with it.
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CatholicGerman
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No, it is possible to make SS solvent. But it would have to be completely removed from the budget and put under a politically-independent governing entity which would be charged with setting payout rates and raising the retirement age, as needed. But that is not a palatable solution, so things will just continue as-is until it all finally dies a horrible, screaming death and millions of helpless elderly folk are left without any income.
Anything but admit that there is a problem.
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MarcellusW
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I dont think there will be millions of old folk left without any income, I think they will instead force my generation into servitude via payroll taxes until we die because the old people preferred to buy a yacht instead of having that extra child.No, it is possible to make SS solvent. But it would have to be completely removed from the budget and put under a politically-independent governing entity which would be charged with setting payout rates and raising the retirement age, as needed. But that is not a palatable solution, so things will just continue as-is until it all finally dies a horrible, screaming death and millions of helpless elderly folk are left without any income.
Anything but admit that there is a problem.
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sw85
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Again, if what Denninger writes is true, the combined liabilities for SS and Medicare exceed $100 trillion. There is literally not enough money in the world to pay them.No, it is possible to make SS solvent. But it would have to be completely removed from the budget and put under a politically-independent governing entity which would be charged with setting payout rates and raising the retirement age, as needed. But that is not a palatable solution, so things will just continue as-is until it all finally dies a horrible, screaming death and millions of helpless elderly folk are left without any income.
Anything but admit that there is a problem.
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Dale_M
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Well, not as instituted, but the people of the US have been willing to let the Congress dip into Social Security funds, as a source of general revenue, for decades. If we had been more responsible, and insisted that either taxes be raised or programs be cut, then we likely would not be in this situation.
I am not sure what you mean by that, but clearly President Bush’s scheme of putting Social Security funds into stock market funds controlled by individuals would have been disastrous given the collapse of the stock market in the US. As it were, many retirees saw their retirement investments dwindle to half their worth, or less. If Social Security benefits had also decreased by a similar amount, the US would be seeing a lot of destitute retirees. I think there is something to be said for a guarantee of income in one’s final years.
In the US, immigrants only get benefits if they pay into the Social Security system, and then, only to the extent that they meet the same requirements of citizens. For example, a person only qualifies for Social Security if they have worked full time for at least 10 years. The amount that a person then draws depends on how much they contributed.
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bbarrick8383
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I don’t know who this “we” is that you refer to. But I have not been willin to do anything nor have I been the one irresponsible with my money that gets taken from me against my will. That’s the problem with liberals, people who want to live life a certain way cant because they got people tellin em how they want them to live it.
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Dale_M
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Bbarrick, I am not sure who your congressional representatives are, so I can’t determine whether or not they have been willing to be fiscally responsible. However, I have noticed that many US citizens are quite happy to have their representatives bring home the pork, yet at the same time decry federal spending. In fact, many of the congressional representatives have done exactly the same: denounce federal spending and yet cut earmarks for their district or state in multiple pieces of legislation.
US voters overwhelming give the Congress low ratings in polls. Yet, these voters consistently re-elect their representatives and senators. It always seems that their own congressmen are fine, its the other guys who are the problem.
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markomalley
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What social security funds?
The way that the system has worked from the onset (a/k/a as originally designed during the FDR time) was that revenue from FICA contributions in excess of social security payments would be invested in government bonds (in other words, the cash is given to the treasury in exchange for debt instruments). The treasury, in turn, places the money into the general fund.
The so-called “trust fund” consists of inter-agency debt instruments. It has never consisted of anything else. Ever (since the '30s ever).
So now that we have reached the point in time where baby-boomers are beginning to reach social security age and fewer people are coming into the workforce, the amount of expenses is exceeding the revenues. That means that social security is presenting those debt instruments to the treasury and demanding payment. That money will come out of the general fund. Again, that is the way the system was designed (except for the fact that people are living longer than they were projected to do and fewer people are being born and entering the workforce than was originally projected).
That is the way the system was originally designed and it is working per its design. Unfortunately, demographic realities make it untenable.
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CatholicGerman
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Yes, but that means we have to reduce the liabilities. SS could be viable as an insurance scheme, but not as a transfer scheme (which is what we have now). The people who created it thought that a transfer scheme would work because the population would be constantly increasing. Now that we know that to not be the case, we should retool accordingly.
Close things off for the elderly, reduce their expected payouts (perhaps completely illiminating them for the wealthy) dramatically, raise the retirement age, and simply resign ourselves to keeping that portion solvent through the tax base.
The rest of us should be moved to a less-generous retirement insurance scheme, similar to unemployment insurance. We should see SS for what it really is: a defined-contribution scheme that is meant to prevent severe deprivation or suffering in old age. Anybody who want to live at a level of comfort and wealth above and beyond that must save the difference, or rely on their children.
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runningdude
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I think the solution is to simply cash in the treasury bonds as needed. New bonds may have to be issued to cover them, and paid back from the general fund, and it will probably suck, but we obviously can’t let millions of seniors fall into poverty.
If that’s not obvious, I feel sorry for you
If that’s not obvious, I feel sorry for you
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josephdavid
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Don’t feel sorry for them because that is the conservative plan. They love poverty. They love social policies and putting people a burden on our budgets just as much as liberals. I am convinced of this.I think the solution is to simply cash in the treasury bonds as needed. New bonds may have to be issued to cover them, and paid back from the general fund, and it will probably suck, but we obviously can’t let millions of seniors fall into poverty.
If that’s not obvious, I feel sorry for you
What this will do is put even more burden on all levels of government and further increase our national debt.
Just transfer the wealth to the richest 2% and it will all trickle down. Have you not seen that yet in the past 30 years?
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sw85
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If SS liabilities are as large as I’ve heard, there is literally not enough money in the world to cover them by cashing in IOUs. SS debt will simply have to be forgiven, and alternate methods of caring for the elderly (perhaps through charity and the intervention of local religious and aid groups) will have to be discovered.I think the solution is to simply cash in the treasury bonds as needed. New bonds may have to be issued to cover them, and paid back from the general fund, and it will probably suck, but we obviously can’t let millions of seniors fall into poverty.
If that’s not obvious, I feel sorry for you
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CatholicGerman
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Have you guys noticed how Paul Ryan is under attack? Interesting and related article. It notes that SS is the “easy one”. Medicare is a complete and total nightmare.
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