McCain & Social Security

[Vermouth]

I'm not saying it's a good system, but you'd think he'd be familiar with it after a career in the Senate. McCain said: "Americans have got to understand that we are paying present-day retirees with the taxes paid by young workers in America today. And that's a disgrace. It’s an absolute disgrace, and it’s got to be fixed."

According to the New York Times, since its inception in 1937, the Social Security system has used a "pay as you go" mechanism in which those working today pay for the benefits of those who have retired.

Afterward, spokesmen for the McCain campaign said that his use of “disgrace” was meant to refer not to Social Security itself but to Washington’s unwillingness to address distortions developing in the system. Indeed, one such problem is the ratio of workers to retirees, which is declining. But Mr. McCain did not mention that issue explicitly, and seemed to undermine his staff’s explanation when he appeared on CNN on Tuesday and, to a large extent, repeated himself.

“They pay their taxes, and right now their taxes are going to pay the retirement of present-day retirees,” he said by way of explaining his support for allowing young workers to open private accounts for retirement. “That’s why it’s broken; that’s why we can fix it.”

http://www.nytimes.com/2008/07/11/us/politics/11checkpoint.html

[Progressive]

The Social Security system needs to be reformed, not privatized like the conservatives want. Privatization is too risky, especially with how the stock market is now.

[OswaldTheOsprey]

The Social Security system needs to be reformed, not privatized like the conservatives want. Privatization is too risky, especially with how the stock market is now.

Very true.

OswaldTheOsprey

[Peter1469]

When the SS system was created there were around 24 workers for every retiree.  Today there are about 4.  Once the baby bommers retire it will be about 2 workers per retiree.  You do the math.  The system will fail. 

I would predict if you privatized 2% of the SS money, it would create more wealth than the remaining 98% over 30 years of investment. 

[Mr. Dirlewanger]

When the SS system was created there were around 24 workers for every retiree.  Today there are about 4.  Once the baby bommers retire it will be about 2 workers per retiree.  You do the math.  The system will fail. 

I would predict if you privatized 2% of the SS money, it would create more wealth than the remaining 98% over 30 years of investment. 

I'm 32 and have no problem shoring up the system with my payroll tax dollars for the time being even though I know I will never collect. You are right though and I'm sure that all who can do the simple math involved would agree.

[Vermouth]

When the SS system was created there were around 24 workers for every retiree.  Today there are about 4.  Once the baby bommers retire it will be about 2 workers per retiree.  You do the math.  The system will fail. 

I would predict if you privatized 2% of the SS money, it would create more wealth than the remaining 98% over 30 years of investment. 

I'm 32 and have no problem shoring up the system with my payroll tax dollars for the time being even though I know I will never collect. You are right though and I'm sure that all who can do the simple math involved would agree.

Certainly, but it wouldn't take much to maintain its solvency. It's adjusted on a regular basis, isn't it? Wasn't the minimum age at which benefits can be withdrawn recently raised?

Social Security shouldn't be a retirement system anyway. It should be a needs-based insurance system. If people want to retire, they should save up for it themselves.

[SmellyLeg]

Social Security number = socialist slave number.

Let people handle their own retirement money. The system is going to collapse soon, anyway.

[Intellectual]

I don’t see how the Social Security system can be maintained for much longer. The government could raise taxes on the top five percent to help pay for it, and they could cut the military budget by seven to ten percent, but in my opinion, the best thing the government could do is remove itself from the handling of people’s retirement money and let the people handle the money themselves.

Personal responsibility – what a radical idea.

[Gunit Hussein Sangh]

The only problem we have with social security is that we have idiots in congress.

The reforms in the early 80s were designed to deal with the lower ratio of workers to retirees. They increased the SS tax so we could pre-pay for our retirement. The real problem is that politicians spent the excess money we paid into the fund.

Now, after the irresponsible economic policies of the GOP has increased our national debt by $4 trillion, it's becoming harder and harder to pay our debt plus all the other obligations.

Here's a way to shore up social security:

Have economic policies that generate good paying jobs in America. During the 90's, when 22 million jobs were created and incomes were rising faster than inflation, the insolvency dates kept getting pushed back in the SS annual report.   

If taxes have to be increased to redeem the treasury bonds issued to the SSA for the excess funds transferred to the general fund ... well tough shit. Taxes for the last 30 years have been kept artificially low because congress was spending the excess payroll taxes we were paying into the system. I feel that those bonds are just as important as any bought by foreign governments or private investors.

[Peter1469]

You claim that the money was spent in the 1980s yet the GOP was in the midst of a 40 + year absence from power.  The GOP wasn’t in the position to rape social security until 1994.  Not that they didn’t not indulge – but you need to add your favorite party to the list of rapists of SS- and understand they were the sole rapists in the 1980s.  The deficit was not caused by lower taxes- which brought in more revenue.  The deficit was caused by uncontrolled spending.  Something both parties are guilty of, although the Dems are ahead in this regard. 

Your ideas on economic growth are flawed as well.  The growth of the 1990s was due to the deregulation (I am no fan of total deregulation) and lower taxes of the 1980s.  The Clinton recession of 2000 had very little to do with Government activity.  It was a natural market cycle that was very much needed to prevent more money being wasted on worthless internet companies.  Then we had 9-11 and numerous corporate scandals and collapses (that has links to both parties).  These hit the economy very hard- one could make a very good argument that had Shrub not lowered taxes our economy would be in much worse shape that it is now. 

The point is that you cannot look to politics alone as the cause of economic ups or downs.   

[they call me MR. GRUMPY god damn it!]

You claim that the money was spent in the 1980s yet the GOP was in the midst of a 40 + year absence from power.  The GOP wasn’t in the position to rape social security until 1994.  Not that they didn’t not indulge – but you need to add your favorite party to the list of rapists of SS- and understand they were the sole rapists in the 1980s.  The deficit was not caused by lower taxes- which brought in more revenue.  The deficit was caused by uncontrolled spending.  Something both parties are guilty of, although the Dems are ahead in this regard. 

Your ideas on economic growth are flawed as well.  The growth of the 1990s was due to the deregulation (I am no fan of total deregulation) and lower taxes of the 1980s.  The Clinton recession of 2000 had very little to do with Government activity.  It was a natural market cycle that was very much needed to prevent more money being wasted on worthless internet companies.  Then we had 9-11 and numerous corporate scandals and collapses (that has links to both parties).  These hit the economy very hard- one could make a very good argument that had Shrub not lowered taxes our economy would be in much worse shape that it is now. 

The point is that you cannot look to politics alone as the cause of economic ups or downs.   

this is balanced, accurate and well reasoned response:in short intellectually honest.  unfortunately, it is wasted on gunnit.  gunnit filed for divorce from intellectual honesty in the 1970s and his divorce was finalized nov 2000

[Gunit Hussein Sangh]

The fix was bipartisan ... the spending of the excess funds was bipartisan ... I reckon I could have added that in my post, but I'm a bit rusty dealing with nit-pickers.

As for the $4 trillion of debt ... that's all on the shoulders of dear leader and his merry band of rubber stamp republicans in congress.

I laugh every time ya'll try to shift the credit for the economy during Clinton's administration to the policies of the 80's. If ya'll have been paying attention to the news lately, you hear things like inflation is rising faster than it has in 17 years .. or consumer sentiment is lower than it has been in 25 years ... and who was in the WH at that time Why St. Ronnie and pappa bush.

What you're really saying is it takes republicans a while to destroy the economy so that when a Democrat gets elected president and fixes the mess, ya'll can take credit for it.

Eight years from now, ya'll will be arguing how dear leader's economic policies led to the great economy under President Obama.

[Peter1469]

I certainly will not be arguing that Shrub’s economic policies gave Obama what you believe will be economic heaven.  The ONLY good thing that Shrub did regarding the economy was to lower taxes.  He did a lot of other things that will cause great harm down the road.  Obama will reverse these tax cuts so there will be nothing worthwhile left for me to point to.  But I will be able to tell you that “I told you so” when higher taxes lead to lower governmental tax revenues.  And we all know democratic spending habits… 

From reading your posts on economics it is clear that you are a disciple of the Keynesian school (or the neo-Keynesian variant).  I am more of the Austrian school.  This would explain why we both accuse the other of being an economic illiterate.  You should know, however, that Keynes himself was not a fan of what became known as the Keynesian economy school. 

[Gunit Hussein Sangh]

I *never* went to an African school on economics 

When Clinton pushed the tax increases thru in 92 (or 93 whenever it was) EVERY REPUBLICAN IN CONGRESS SAID THE SAME DAMN THING YOU JUST SAID.

And it didn't happen. The economy grew, incomes rose, revenue went up and the BUDGET WAS BALANCED.

[they call me MR. GRUMPY god damn it!]

I *never* went to an African school on economics 

When Clinton pushed the tax increases thru in 92 (or 93 whenever it was) EVERY REPUBLICAN IN CONGRESS SAID THE SAME DAMN THING YOU JUST SAID.

And it didn't happen. The economy grew, incomes rose, revenue went up and the BUDGET WAS BALANCED.

so in your mind the tax increases spurred the economy.  gunnit you are clearly an intellectual black hole.  no racial connotation intended.