~rant begins~

Its so great how the money in the current Social Security pool, for years, is money upon which other people (private investment agencies) want to get their hands to the point of manipulating federal policy to get those funds privitized. All they are really saying is this "Ya know how we scammed you for years into thinking that a 401K was a good investment, where we take pre-tax dollars out of your paycheck, drop it into the publically heald funds of your choice, and then not let you touch it for years and years even if you roll it over upon leaving an employer, and if you do touch it you have to pay capital gains because the money was put in pre-income tax and the federal government wants their piece of any interest you earn on those dollars too? Well, now we want to roll your social security into that process so that by the time you retire, if you ever retire, there will be NO guarantee whatsoever that a specific dollar amount (average dollar amount based on annual earnings over 3 or so years time) will be available to you, because any of the funds you selected could go bust if the economy sucks. Ain't that grand? It gives you so much freedom ...."

What a crock of shit. Once again, this administration is about to ream the entire country, and people are so screwed up they haven't a clue. You would think that the national deficite the adminstration created by way of war would be something they want to resolve.... oh wait a minute, what better way to shift any attention of that around by saying that Social Security needs to be reformed by way of privitization (to eliminate any federal debt associated with it by moving it off of our plate).

I mean, the system is flawed, should never have lasted this long, etc., sure, but what a frickin' JOKE to think that this administrations plans or proposals would be of any assistance to the program. Their ideas are specific to completely ELIMINATING it, which means, all of our older aunts and uncles, or even some of our parents, are now F'd after putting into it for 30, 40, or 50 years.

I pulled out of any 401k contributions with the 2000 election and have sit for 4 years and watched the ones that are trapped in 401k Pergatory dwindle to less that the amount that was even rolled into them, and I can't even get the money out to keep from having it disappear without them taking a huge chunck of it anyway.

So weak. People are so lame. I don't understand how so many people can be suckered so many times and so much by fear and loathing that they are incapable of seeing that time and time again, they are getting screwed while their back is turned.

I don't get it. I'll never be able to retire, and even if I could, there will never be any social security, or at least, I'll have to be 75 to get it, and the "f" if I want to work my ass of to age 71 or 75 to collect so little of an amount that I would end up having an income at poverty level.

We suck (this country). We don't take care of our own, while we run around messing with other people and their business, all to protect the economic interests of a very small number of individuals and/or corporation, pretending its another human interest story.

~rant over~

Bah Humbug.

And my cat is sick. Great to know when I get a bit older I won't even be able to afford to have a pet, probably at the time of life when one would benefit most from having the comfort and companionship of one. I just can't wait.

Somebody kill me now.

couldn't have said it better myself

I've invested in my 401k since 2002. I've made a 12% return. So I am not complaining.

Most people don't take their time to study their 401k funds or watch how they are performing. Thats why most people lose money in their 401k. Sure, stocks dropped big time after 9/11. That's a cycle that happens. Yeah, the stock market hasn't made huge gains since 2000, but you can't base it on 4 years. You are investing long term with a 401k.

I like the idea of keeping my own social security. I take the time to study stocks and funds. I take the time to track how they are performing. If you are not willing to do that, then you don't have to move you social security into a private account. From what I read, that is your choice. They aren't going to make you do that. I think I have a better chance at making a nice return on my social security than the government would. I look at my paycheck and see all the social security money I will never see again and it makes me sick. If I could have kept that money and put it in my 401k funds, I would have made a nice return on it.

Social security is very flawed and something needs to be done.

From SSA.gov

1.) Social Security must change to meet future challenges

Social Security has been a basic part of American life for almost 70 years. It provides a base of economic security in today’s society through a valuable package of retirement, disability and survivors insurance.

More than 156 million workers are protected by Social Security, and more than 47 million people receive retirement, survivors and disability benefits from Social Security.

The Social Security system is designed so that there is a link between how much workers and their employers pay into the system over their working years and how much they will get in benefits. Basically, high-wage earners receive a higher benefit payment than low-wage earners. However, the benefit “formula” is set up so that lower wage earners will get a higher percentage of their pre-retirement earnings.

Social Security has been changed over time to meet the needs of the American people. It will need to change again to meet future challenges.

Strengthening Social Security to meet changing needs is important to you ... to your parents and grandparents ... to your children and grandchildren. In the upcoming national debate on Social Security reform, it is important that you understand the issues presented in this booklet about the system’s long-range future.

2.) Social Security has made an enormous difference in the lives of older Americans

Social Security provides older Americans with a dependable monthly income with automatic increases tied to increases in the cost of living.

Workers can retire as early as age 62 and get reduced Social Security benefits. Or they can wait until full retirement age and receive full benefits. In 2005, the full retirement age is now 65 years and 6 months. It will increase gradually until it reaches 67 for people born after 1959.

More than 9-in-10 retirees now get Social Security benefit payments each month. For two-thirds of the elderly, Social Security is their major source of income. For a third of the elderly, Social Security is virtually their only income.

3.) Social Security is more than a retirement program

Social Security also is “America’s Family Protection Plan.” Younger workers and their families receive valuable disability and survivors insurance protection. In fact, about 1-in-3 Social Security ¬beneficiaries is not a retiree.

About seven million people get monthly survivors benefits, and more than seven million workers and family members get disability benefits. These benefits can make a significant difference. For example, a 35-year-old worker who earns $40,000 a year and who has a spouse and children could get about $1,800 a month from Social Security if he or she became ¬disabled. If that same worker were to die, his or her family could receive about $2,300 a month from Social Security in survivors benefits.

4.) Social Security provides a foundation on which to build retirement security

A comfortable retirement rests on a three-legged financial stool—Social Security, pensions and savings.

Today, about half of all workers are covered under an employer-sponsored pension, and many people are not saving as much as they should. While Social Security replaces about 40 percent of the average worker’s pre-retirement earnings, most financial advisors say that you will need 70 percent or more of pre-retirement earnings to live comfortably. Even with a pension, you will still need to save. If you
will not have a private pension, you will need to save more—and start saving sooner.

Each year, we mail a Social Security Statement to workers age 25 and older. This Statement shows your earnings history and also gives estimates of your retirement, survivors and disability benefits provided by Social Security. You should use this Statement to help you with your future financial planning.



5.) Changing demographics are driving need for changes in Social Security

The main reason for Social Security’s long-range financing problem is demographics. We are living longer and healthier lives than ever before. When the Social Security program was created in 1935, a 65-year-old American had an average life expectancy of 121/2 more years; today, it is 171/2 years and rising.

In addition, 79 million “baby boomers” will begin retiring in 2008, and in about 30 years, there will be nearly twice as many older Americans as there are today. At the same time, the number of workers ¬paying into Social Security per beneficiary will drop from 3.3 today to about 2.1 in 2031.

These demographic changes will severely strain Social Security financing.




6.) Current Social Security system is unsustainable in the long run

Many people think that the Social Security taxes they pay are held in interest-bearing accounts earmarked for their own future retirement needs. The fact is that Social Security is a pay-as-you-go retirement system—the Social Security taxes paid by today’s workers and their employers are used to pay the benefits for today’s retirees and other beneficiaries.

Social Security is now taking in more money than it pays out in benefits, and the remaining money goes to the program’s trust funds. There are now large “reserves” in the trust funds, but even this money is small compared to future scheduled benefit payments. In 2018 benefits owed will be more than taxes collected, and Social Security will need to begin tapping the trust funds to pay benefits. The trust funds will be exhausted in 2042. At that time, Social Security will not be able to meet all of its benefit obligations ... if no changes are made.

7.) Choices lie ahead

There are several ways to guarantee that Social Security continues to be there for future generations. Each option means difficult trade-offs that Americans need to know about. The sooner the changes are made, the smaller their impact will be.

For example, some people think that benefits should be reduced, or at least their future growth should be slowed. One way of doing this would be to increase the retirement age for full Social Security benefits. They say that Americans are living longer and healthier lives than ever before and that people are spending an increasing number of years in etirement. Critics of the proposal to further raise the retirement age say most Americans now choose to retire early, and that it would be hard for some ¬people to work past the ¬current retirement age because of their health or because their jobs are just too demanding.

Some people believe that Social Security taxes should be raised so that all future benefits could be paid. They want to increase the current combined payroll tax rate, which is now 12.4 percent. Critics argue that payroll taxes are already very high, having been raised 20 times since the program began, and that almost 80 percent of workers already pay more in payroll taxes than they do in income taxes. And they point out that eventually Social Security taxes would have to be raised by about 50 percent to pay for all benefits owed.

Other people believe that the future financing ¬problem can be solved without reducing benefits or raising taxes. They favor “pre-funding” benefits for younger workers by letting them have their own voluntary Social Security personal savings account. They say that by investing in stocks and bonds, workers could receive higher benefits. Supporters also say ¬personal accounts would allow workers to leave a “nest egg” to their heirs.

Critics say that personal retirement accounts mean higher risks for workers, and that if investments were not doing well when a worker is ready to retire, plans would have to be changed. They also say personal accounts could be expensive to administer.

Some people think the government and not ¬individuals should invest Social Security reserves in stocks and bonds, so that higher potential returns can be earned but financial risks shared. But critics say the government should not invest in private ¬companies, because the government could end up being the largest stockholder in a company.

There are other options and suggestions being ¬discussed that could strengthen the Social Security retirement system. While there is disagreement over what should be done, the 2004 Annual Report of the Board of Trustees notes that “projected trust fund deficits should be addressed in a timely way to allow for a gradual phasing in of the necessary changes and to provide advance notice to workers. The sooner adjustments are made the smaller and less abrupt they will have to be.”
If you would like more information on how the Social Security program works and the critical financial issues now facing the program, you can visit our website at http://www.socialsecurity.gov.

I honestly think it's too big to fix, and Bush just isn't going to be able to come up with the cash necessary to fund it all. But whatever. It's out of my hands. If I didn't have to pay into SS I wouldn't.

Tsunami, you always have so much to say!!!!

I'm not understanding this. Are you trying to say you think the Governement which gives you no guarentee of ever seeing that social security money is doing a better job investing it than you yourself could?

That's absolutely insane.

If you took that money and shoved it in a shitty savings account it would earn you more money than the government makes on it.

If you put it in a money market you'd make exponentially more, and if you were wise enough to say purchase real estate or make good stock decisions you probably wouldn't even need to take extra money and put it in a 401K but hey, you can trust the govenment if you want.

Even if you made say 35,000 dollars a year at your peak, you still do much better keeping and investing your own money than the government ever will, they spend it as soon as you earn it.

I make around 35K right now and my 401K is kicking absolute ass.

If you die early, your SS money is gone, your family can't even use it to bury you or pay off your debt.

You are familiar that the baby boomers are about to be of age? I sure hope no one plans to retire soley on Social Security.

that means more people will be drawing off of the Social Security kitty than will be paying in. What to do then?

anyway, hope your day gets better and your cat gets well.

Yupper.

I found your post very interesting though spk!

The federal government wants the taxes it didn't collect from you when you put the money away. You only pay capital gains tax on the income of the fund, just as you will if you wait to withdraw if when you retire. I don't really see any issue here.




There is no guarantee that SS will be available either. Did you know that currently there are 7 workers to pay for each retiree? In 20 or so years, that number will be 2. That's right - 2 to 1. Also, historically, over the long run (which is not 3 years), you will earn more in the stock market than you will with SS, which currently is about 1% (less than the rate of inflation, so you're actually losing money).





The plan is a voluntary plan, and no one will be F'd. Even if you're 45 right now, you will still get a SS check based on what you contributed up to this point and for future contributions made as the plan does not allow for a complete withdrawal from the system.



Again, it isn't disappearing - it is you paying the taxes you didn't pay 4 years ago.



I guess you don't understand that current payout levels are below the poverty level and that if you want more than that you should start contributing again to a private retirement plan. The fact that the market is low (in your eyes) now is the best time for someone that isn't going to retire soon to get into the market since you're buying low. Also, if you're that concerned with the stock market, you can invest in funds that deal only with government bonds, and even at their low rate you'd still do better than SS.



I'm sorry about your cat

*agrees with Kelli and spk*

Electromatic,

No, that wasn't what I was saying. I was saying what you are saying.

PJDoll,

I'm aware that there is no guarantee on Soc. Sec.

I don't believe that, even if the plan is voluntary in its infancy, that it will remain voluntary.

My cat's health care in the last 7 days has cost me $1,700. - and they still don't know what is wrong with him.

Ultimately, I agree with most of you: the system is completely screwed up and needs to be changed or fixed or eliminated or replaced, but I have absolutely NO faith and NO trust in this current administrations plans or proposals whatsoever, and I'm tired of feeling f-d over by them, by major corporations, by everyone and everthing I see. I'm sick of hype, fear, over-consumerized merchandizing, and squander, I'm sick of EVERY AGENCY and every politician and everyone else in between wanting a piece of our HARD EARN MONEY, Money that should go toward feeding our families, etc. I'm sick of the constant bombardment on television and in the news of nothing but complete bull-shit, I want some god damned TRUTH, I want someone to step up and say "I don't want your money, and I'm not lying", and I want people who are in NEED to be helped and people who are full of shit to drop dead. That is/was my rant - generalized in the extreme.

Hope that clarifys.

c-

The best thing to fix social security would be a bullet it to its head.

1.) Social Security should be voluntary.
2.) Social Security will exist until approximately 2042.
3.) I loved it the day Barbera Boxer said to a bunch of twenty somethings, "you don't have to worry, if you are 25 now, you should know that Social Security will exist for another forty years." That's great Barb, way to tell 25 year olds that Social Security will cease to exist when they retire.
4. When social security started, there were 16 workers for every retiree. Today someone mentioned that that number has dropped to seven, and I have heard as low as four.

Social Security sucks. It largest mass theft scheme ever concocted by the government. It's so full of flaws.

Think about how...big...the social security pot would be if the government had invested in the market when it was originally started. Say, in Coca-Cola, or Wal*Mart. God...we'd all be rich, we could retire at 50.

I feel the same way!!!!

I'm not an economist, and frankly I don't understand economic policies as well as I'd like, but my gut tell me that this privatization plan is not a good idea. Since we've seen mostly positive feedback here for privatization ideas (to whatever degree) I'd like to just throw out the other side of the story.

http://www.nytimes.com/2004/12/17/opini ... ugman.html

Buying Into Failure
By PAUL KRUGMAN

Published: December 17, 2004

As the Bush administration tries to persuade America to convert Social Security into a giant 401(k), we can learn a lot from other countries that have already gone down that road.

Information about other countries' experience with privatization isn't hard to find. For example, the Century Foundation, at http://www.tcf.org, provides a wide range of links.

Yet, aside from giving the Cato Institute and other organizations promoting Social Security privatization the space to present upbeat tales from Chile, the U.S. news media have provided their readers and viewers with little information about international experience. In particular, the public hasn't been let in on two open secrets:

Privatization dissipates a large fraction of workers' contributions on fees to investment companies.

It leaves many retirees in poverty.

Decades of conservative marketing have convinced Americans that government programs always create bloated bureaucracies, while the private sector is always lean and efficient. But when it comes to retirement security, the opposite is true. More than 99 percent of Social Security's revenues go toward benefits, and less than 1 percent for overhead. In Chile's system, management fees are around 20 times as high. And that's a typical number for privatized systems.

These fees cut sharply into the returns individuals can expect on their accounts. In Britain, which has had a privatized system since the days of Margaret Thatcher, alarm over the large fees charged by some investment companies eventually led government regulators to impose a "charge cap." Even so, fees continue to take a large bite out of British retirement savings.

A reasonable prediction for the real rate of return on personal accounts in the U.S. is 4 percent or less. If we introduce a system with British-level management fees, net returns to workers will be reduced by more than a quarter. Add in deep cuts in guaranteed benefits and a big increase in risk, and we're looking at a "reform" that hurts everyone except the investment industry.

Advocates insist that a privatized U.S. system can keep expenses much lower. It's true that costs will be low if investments are restricted to low-overhead index funds - that is, if government officials, not individuals, make the investment decisions. But if that's how the system works, the suggestions that workers will have control over their own money - two years ago, Cato renamed its Project on Social Security Privatization by replacing "privatization" with "choice" - are false advertising.

And if there are rules restricting workers to low-expense investments, investment industry lobbyists will try to get those rules overturned.

For the record, I don't think giving financial corporations a huge windfall is the main motive for privatization; it's mostly an ideological thing. But that windfall is a major reason Wall Street wants privatization, and everyone else should be very suspicious.

Then there's the issue of poverty among the elderly.

Privatizers who laud the Chilean system never mention that it has yet to deliver on its promise to reduce government spending. More than 20 years after the system was created, the government is still pouring in money. Why? Because, as a Federal Reserve study puts it, the Chilean government must "provide subsidies for workers failing to accumulate enough capital to provide a minimum pension." In other words, privatization would have condemned many retirees to dire poverty, and the government stepped back in to save them.

The same thing is happening in Britain. Its Pensions Commission warns that those who think Mrs. Thatcher's privatization solved the pension problem are living in a "fool's paradise." A lot of additional government spending will be required to avoid the return of widespread poverty among the elderly - a problem that Britain, like the U.S., thought it had solved.

Britain's experience is directly relevant to the Bush administration's plans. If current hints are an indication, the final plan will probably claim to save money in the future by reducing guaranteed Social Security benefits. These savings will be an illusion: 20 years from now, an American version of Britain's commission will warn that big additional government spending is needed to avert a looming surge in poverty among retirees.

So the Bush administration wants to scrap a retirement system that works, and can be made financially sound for generations to come with modest reforms. Instead, it wants to buy into failure, emulating systems that, when tried elsewhere, have neither saved money nor protected the elderly from poverty.

____________________________________________

I think that comments like



betray the true motivations of the Bush administration and the right-wing in this problem. They would never say that, but I think it is what they believe. It seems from my limited knowledge of the issue, that Social Security's problem is insufficient funding/excessive benefits, not bloated bureaucracy and inefficient management as the privatizers would have us believe. It seems that the system itself is fine, but as the number of workers to retirees ratio has changed over the last 65 years (the numbers I've seen was 9:1 when it was started, 7:1 a generation ago, 3-4:1 now, 2:1 in 10-15 years), the method of funding the system has not changed along with it.

There are several possible adjustments that can be made.

1) Adjust the payroll tax. Now you can't just raise the rate and leave everything else as is because workers are already struggling with the amount that is paid now. But the thing is, only the first (approximating the number here, help if you know the exact figure) $100,000 of salary is subject to the SS payroll tax, after that all pay is clear. That limit simply should not exist. If you make $500,000, you should pay SS tax on every dollar you make. That would raise revenue, not enough to solve all the problems, but it would certainly help.

2) Decrease benefits. Here is the option nobody wants to touch at all, and understandably. I don't like the idea either, but it had to be listed.

3) Raise the retirement age. It used to be that if you lived to be old enough to take Social Security, chances were you would receive benfits for more no than 10 years or so, but now MANY people are taking benefits for 20 years or more, and that math does not compute. If you raise the age to receive benefits to 68 or 70, it cuts down on the benefits given and helps balance the equation. However, as Chris Rock said, "If the average black man dies when he's 57, why should he give a shit about Social Security reform?"

4) Fund the system from a new source. I'm not an expert on the budget, but I imagine that there is some place in the federal budget where money can be reallocated to supplement the SS trust fund. Some luxury that can be taxed, or another social service that might actually need less money if SS were solvent. The where is a question for the policy makers.

I don't work on Wall Street, but it seems to me that the Wall Street "experts" who are advocating privatizing Social Security stand to make a fucking hell of a lot of money if it happens, be it from commissions, or from the $1 TRILLION the government will have to borrow for the transistion period.

--PunkDavid

How's about privitazation as in....... LET ME KEEP MY DAMN MONEY!?



If you die before you collect your money it's nothing but another tax.



Why not get rid of social security altoegther?

It's amazing how I agree with you on nearly everything related to economics, but little else

How's about .... they're gonna take your money one way or another to help all those impoverished senior citizens because AARP is one of the most powerful lobbying organizations in the country.

Seriously, I'm surprised at you people. For all your talk about thinking long-term and thinking of others, you sure are acting like the selfish, shortsighted gen-xer's that they think you are. "Let me keep my money" doesn't help anyone else, and it doesn't help you if you fuck it away as the consumer culture will encourage you to do at every step for the rest of your lives. And if you say, "Well, I'm smarter than that and I can invest that money better than the government can," what happens to those who are not as skilled as you at investing. I'm pretty fucking smart, but I haven't a clue about investing, except that I know real estate is always a good bet, assuming you've got the capital.

Speaking of betting, you do all realize that is what investing in the stock market is, right? When you go into a casino, some people win, and some lose, and the games are stacked so that in the grand scheme the house always wins, and the players always lose. Now the stock market is just the opposite, in the grand scheme, the players always win (at least in the long term, barring any major catastrophe). But just because you are a skilled investor and can make 5% more than the market average, you have to realize that there are just as many people, probably many more, who will make significantly less than the market average, and I guarantee those will be the people who have the least to begin with because they don't have the education to be skilled investors.

It is neither possible, nor in my opinion desirable for everyone to have to become educated in investing in order to not be impoverished at the end of their lives. Besides, if they did, it would just cut into your profits. The point is, everyone is talking about the benefits of this, and nobody is talking about the costs.

But what else should I expect from the shiny happy administration?

--PunkDavid

I help people, after work I'm going to buy toys for Dfacs kids and buy food for the food bank. I do this with my own money.

Why does the government need to steal from me to do it?

I can make exponentially more money than I am paying out in social security money with that same money, not only will I live better, I will also keep contributing to good charities like the Salvation Army that do not waste 99.9999% of the money in administration.

The AARP is a gigantic lobbying group and they are declaring war on the younger generations, ok assholes. I'm firing back.


WE CANNOT DEPEND ON THE GOVERNMENT TO DO ANYTHING CORRECTLY, much less provide for the elderly, the crippled, or otherwise.

It's an absolute travesty of justice, that no one seems to care that the average age of the black man is 57 so many work thier entire lives paying into this wasted system only to be robbed of that money. Sooner or later this crap has to end.

One generation of people are going to get screwed for their money they paid in, when they ax this stupid program. If they give us our money back, and make it our responsibility to provide for our own future, the majority of the rational,intelligent people are going to make it work for them.

The rest will be taken care of by charity just like they are now. One can scarcely afford to live on social security anyhow. It's a drain on the economy.

But that's pretty much my opinion on everything, individual responsibility for life.

Let the government build roads and protect commerce put out fires, settle disputes, protect national parks etc. Everything else we handle on our own. Is it fair? hell no. but it's never going to be fair.


Even if people take that money and shove it into a Money Market or a savings account, it's still going to provide for you better than the government.

Social Security treats everyone as if they are too stupid to realize they need to provide for their own future.

You don't trust the government to handle money, I don't trust people to give to charity.



Your cynicism is terribly disturbing. SSA has a remarkably low admin cost compared to most gov't funded ventures, far lower than Defense, Congress, Justice, or any of the government functions that even the most reductionist person would concede are necessary fucntions of a national government.



A tragic situation that is related to several social problems, all of which are unrelated to Social Security. We can have an "Urban Poverty" or "War on drugs" thread to discuss how to raise the life expectancy of black men.



But what about those who don't make it work for them? What happens to those people who lose their shirt so that you can make out big? Because you can't make money without someone else losing money. Is it just "fuck 'em, they were stupid"? Plenty of people are going to TRY to be responsible, and still end up with nothing. Maybe they were unlucky. Maybe they were cheated. Maybe it doesn't matter because one way or another, we all end up paying for poverty in monetary and social costs. Social Security provides a FLOOR for those at the very bottom, and it's a very low floor at that, but it's better than sleeping on the cold hard ground.

--PunkDavid

For all my ranting you will all never know how important it is to me to read all of your well thought out and informed responses (and how lightening it is to read the side bar joking as well).

Putting aside the fact that Social Security was never intended to be a program with a life lasting as long as it already has.... I wonder if anyone will make a nice graphical colored chart for George to show him and his adminstration that if he took just the money he spent on the War in Iraq, and added to it perhaps the money he sent budgeted be given to religion based organzations (remember, the ones whose compassion we wanted to "unleash"), and instead applied it to assorted domestic // federal programs, how the bugetary shortfall that exists within the Social Security system, might very well have be immediately rectified.

I'm not saying that throwing more money at a problem fixes it, but with all the money he has thrown away on the "war", and for that matter, all the money thrown away on things like failed "the war on drugs" program or the similarly failed "no child left behind" program, it would be interesting to see how all the numbers shake out, hypothetically.

c-