www.FixSSNow.Org 1-stop shopping for people interested in Social Security reform. We provide information on all proposals in more down-to-earth terms without polarizing rhetoric.
@kynefski , very good point. you are correct to point-out his misuse of words. There are a lot of people covering the debate that use the same misnomer. It is however a common mistake in the public discussion to equate past income with current wealth. For example, the Social Security current means test is based on current income. The IRS collects a 'tax' on people with substantial outside income, and returns the revenue to Social Security. I suspect that people say means-test rather than progressive price-index because most people know the meaning of the former, but not the latter.
4 months ago on Conversation @ http://www.newrepublic.com/article/117782/rubios-social-security-reform-plan-puts-ball-democrats-court
This isn't a plan. It is a speech. It doesn't fix Social Security, it doesn't extend the exhaustion point of the trust by even a year.
It is not serious. It ignores the Disability program which is scheduled to reach insolvency in 2016. Half of the plan makes Social Security less stable. So there is no indication that the plan will even improve Social Security's finances.
So Danny why should they read it?
@WesternFreePress @JoeEconomist @dleeper47
The worst shock is those people who think that they will get nothing. I hear it all the time, but they haven't factored in the problem that it isn't whether they lose their benefits but rather whether their parents lose their benefits.
Having to support parents is a concept that we haven't known since the 1930s.
1 year, 1 month ago on Three Reasons to Fix Social Security Now!
I use the word promise myself, but only because it is better than obligation. Promise is misleading where as obligation is flat out wrong. Social Security's promises can be changed at anytime.
The trainwreck that forms out of Social Security is going to be the surprise. There are some workers who think that there is a separate account with their name on it. Others think that promise means guarantee. Others
In 1983, everyone in the work force found-out that promise is more like estimate. I don't have a better word.
Your article is sound. We write at length about the inefficiency of Social Security. The inability to adapt to risk appetite is simply one example. The economic returns of the Trust Fund is another.
Alex Pollack of AEI put forward the buy-out idea in a piece in Barrons a year or two back. The problem with his piece is that he used the wrong shortfall to calculate his buyout. He said that you could get $0.83 on the dollar. The fact is that with the correct shortfall it is closer to a dime on the dollar.
We originally put forward a buy-out concept as a solution. It is very complicated because it works within the existing framework, and you get closer to the dime on the dollar.
We would like re-print your letter on our site FIxSSNow (dot) Org. Let me know if that is OK.
@WesternFreePress @dleeper47 ,
I would be very careful about the word 'promises' and Social Security. Very few people who have paid into Social Security understand what was actually promised. They know what their scheduled benefits are, but those promises come with a clause written in fine print - provided the future workers are willing to pay.
Today anyone 64 or younger expects to outlive full benefits, assuming that future workers are willing to put 12.4% of wages into a system that 'promises' substantially less. I have my doubts.
I work with Fix Social Security Now, and we provide information on all of the alternatives in the debate, including the buy-out option. While it is an idea that we like... the concept is not in any alternative in the public domain.
We answer the question about the investment policy of the Trust Fund. In small doses - say 25 billion or less - Treasuries are the safest investment. At 2 trillion... you have last-dollar risk that few people are talking about. Improving the return on the Trust Fund is an idea that we like - but again it is not in any alternative in the public domain.
Whether you get your 'money back' is a technical question. You collect more on a nominal basis if you live to 83. The problem is to collect anything you had to take the risk of collecting nothing. You can die without qualifying for benefits, and if you are going to talk about your returns you have to factor in that possibility.
I will look at the article.
I don't know whether you are tracking this article.
Legally you are required. Social Security is a tax according to the Supreme Court technically no different from your income tax.
Today we are paying benefits to people who may have started work in 1940. At that time, and into the mid-70s, people didn't pay the full cost of benefits. Congress was giving away benefits at nearly 1/10th the actual cost - it was effective in getting reelected.
What Social Security will tell you is that you will get a return, and for some that will be a very good return (provided that it is paid). For most of us, it is a negative return though.
Social Security will be around to the extent that there is public support for it. The demographics of support are changing. 2012 was the first year in which a majority of voting aged Americans expect to retire after the Trust Fund is going. The Trust Fund is the cushion with which the system pays full benefits.
2 years ago on Social Security – What You Need to Know About Benefits, Coverage, and Eligibility