SS Reform

Discussion in 'Homesteading Questions' started by duke3522, Feb 12, 2005.

  1. duke3522

    duke3522 Well-Known Member

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    Hi Everyone,

    Just my 2 cents from someone who would be living in the street (or not living at all) if it were not for SS. I have been unemployable since I was since I had major back surgery when I was 16. It’s hard to hold a job when 7-8 times a year you can’t walk for a week. Now I am not on SS personally, since before I meet DW I Flea Marketed and wheeled and dealed when I could to make a living. So I do not have enough quarters of employment to qualify. But DW played by the rules and paid in to SS for years, and thank goodness she did. Without the Medicare and SSDI she receives I do not know what we would do. But from the sound of some of the responses on this thread some think we should just limp over into the corner and die.

    And the answer to the statement “Well if you would have had those payroll taxes to invest you would have had money to fall back on.” Nonsense!!! At the beginning of my wife’s illness we had investments and savings that I thought would carry us through for at least a year. Wrong. Between trying to keep our health insurance, and all the other co-pays and deductibles we burned though our savings in a matter of months. And since it took 3 years to get DW’s SSDI we are now $100K+ in debt for hospital expenses that the high risk pool insurance would not cover.

    And guess what folk’s, unless you have big, big bucks in the bank, you are all one major illness from being in the same boat.

    This round of SS reform is simply an attempt by Wall Streeters to get there finger into the SS pie. They see that flow of cash and they just can’t stand that they don’t get their cut.

    I think real SS reform would start with the following:

    1. Cut payroll taxes to the estimated amount that would be paid out that year. In a pay as you go system there is no need to collect more than you pay out. The excess simply goes to the general fund and is nothing more than a highly regressive income tax (Hmm…maybe that was the idea when Reagan raised payroll taxes in the early 80”s).

    2. Eliminate the income cap on Payroll taxes. Sorry, but if you make over a hundred grand a year you would have to pay more. But not that much more if we go to a true pay as you go system.

    3. Means Test. I have an uncle who has done very well. His retirement income is $500K+. And what does he do with his SS check every month (and he gets the top benefit) Vegas or Atlantic City. Now I don’t begrudge him, he worked hard and deserves to live well, but I don’t think he would miss the $1500-$2000 he gets from SS, while there are folks out there who worked hard all their life and now have to decide whether to buy essential meds or food. Oops, sorry I forgot, folks like us should just crawl off and die.

    Like I said, Just my 2cents.

    Duke
     
  2. duke3522

    duke3522 Well-Known Member

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    Sorry didn't mean to start a new thread. Oh well.
     

  3. Oilpatch197

    Oilpatch197 Well-Known Member

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    that's okay, lets set you right!

    the problem is Social Security needs a LOCKBOX, they were dicussing the lockbox during the 2000 elections, the problem is that when SS gets the money, they pay out the benifets and the rest goes to the treasury, where it can be spent by politicians.

    This is Okay when we got a surplus, but thanks to YOU baby boomers there may be just ONE taxpayer supporting you, then that would mean the SS will not have enough to pay out benifits and has to go to the treasury, but the treasurey won't have it, because it was spent on a road improvement bill.

    solution start a lockbox and Wait for all you Baby boommers to die. Then the system should fix itself, we just got a wave of retirees comming thru the system....:eek:
     
  4. LiberalCountryBoy

    LiberalCountryBoy Well-Known Member

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    That's right Duke,
    You had just as good a chance at being born wealthy as Bush did. Since you weren't born wealthy, you must plan for every contingency on your own or 'tough luck'. None of that commie socialist uniting together bull dookey.
    The disabled, unemployed, old folks, people screwed by Enron's, all of you can go live in a Van under the bridge DOWN BY THE RIVER!
    You should probably read up on 'How To Build Mud Huts, Tin Shacks, Etc'. It may come in handy in the future.
    A Third-World Country coming soon to a neighborhood near You.
     
  5. Jenn

    Jenn Well-Known Member Supporter

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    Amen! And also maybe #2 levy SS taxes on nonwage income, so the 60% income some CEOs etc get from bonuses would also share the load. And I'm one who might someday pay more (hope to have over $90,ooo SE income in a few years) and not receive any benefits since like Duke's uncle I've planned properly for retirement and not had much hard luck financially yet knock on wood.
     
  6. tsdave

    tsdave Grand Marshal

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    First, these threds probably dont belong in "Homesteading Questions", and I try so hard to avoid "General Chat" but since its here ...

    The surplus from social security is used to purchase government bonds, which in fact pays social security $80 billion / year in interest.

    Next social security was ment to be a plan for 'ALL' people, not just the poor.

    I love your solution, stop the 'rich' from getting any benefits, and make them pay more for it. Im sure that sounds like a good idea to a poor man, who wants something for nothing. But in the real world, people dont get something for nothing. At least not for long.

    And that last line is the real point , NOT FOR LONG.

    Keep in mind there are people in this world that would think you are rich, and therefore you should pay some of your current money to them ! Yes that is right ! Right now , if they could vote and make it so, alot of people in mud-huts would vote you must pay them some of your money ! They want half your medicines ! And believe they have every right to them.

    Maybe you should spend your time ranting on health care system reforms instead. But you probably already do.

    I dont ever remember seeing a sign on the highway saying "Everything in life is fair". Things will NEVER be fair ! The best you can hope for is being FREE, and forcing other people to do things for you, even the rich, is not the way to accomplish it.
     
  7. tyusclan

    tyusclan Well-Known Member

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    I don't remember the figure exactly, when SS was originally set up you had about 20 people paying in for every one that was drawing out. Also most people didn't live more than a few years after retirement. Now we have about 3 or 4 paying in for each one receiving benefits and people are living longer and longer. And I'm not saying that's a bad thing. It's good that people are living longer. My point is that the system is basically set up just like it was from day one. It will not survive uless something is done.

    Privitization works. The city of Galveston opted out of SS because of a loophole in the law (that has been closed, by the way) in the 1980's. The average retiree under their plan has roughly three times more benefit than a person retiring under SS with the same salary.

    I work for the county and we are under the state retirement system. A little over two years ago the state gave us the option of state under the pension plan or converting to an investment plan. I opted to switch to the IP. Under the pension plan it had taken 9 years for my retirement fund to grow to where it was when I made the switch. It has more than doubled in two years.

    I for one would like for them to allow me to have control and invest the entire amount that I pay in, but I know that is not going to happen. They're only talking about privatizing part of it. They have controls in place to protect those already receiving benefits and those who are close to retirement.
     
  8. duke3522

    duke3522 Well-Known Member

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    Hmm.. Getting something for nothing...then what was all that money DW paid in payroll taxes for. And I resent the implication that we are freeloaders. We live very frugally and everyday I try to think up ways to make enough income to support us. And DW spends her time in between seizures sewing stuffed animals out of cloth I get at rummages for the kids in the Peds ward where she use to work. She worked from the moment she graduated high school until she began to have seizures. And yes I tell people all the time that we are very fortunate to live in a place and time where even though we are unable to produce much we still live better than 99% of the people who have ever lived. And to those of you out there who pay payroll taxes THANK YOU, THANK YOU, THANK YOU!!

    But do you actually believe I like this life. I would love to be out there producing and wheeling and dealing to make a living. And I lose a little more of myself every time I have to ask for help. If I could I would trade my spine for yours and give you a million dollars and my house, but you would be back soon enough telling me you got the short end of the deal. I would be happy to live in my truck and eat out of dumpsters if I could be pain free.

    Why don’t you just come out and say what you mean. It would be refreshing to hear one of you who are so against SS to come right out and say that they support “The Right To Starve” be re-established in this country. At least the folks back in the early 1800’s had the guts to come right out and say it.

    Come on. One of you must have enough guts to go out and find a little old lady who’s income is just her SS and look her in the eye and tell her that since you are no longer of any benefit to society, and that since you are stealing my money that she should die.

    duke
     
  9. Mid Tn Mama

    Mid Tn Mama Well-Known Member Supporter

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    As for wanting to "invest" your retirement, you already have that option with 401k's and the like. Talk to someone who has wanted to retire in the last few years and they will tell you that that wasn't such a great option when stocks have fallen. Many many many people are still working when they thought they would be retireing in the last few years. Why? Because their "investment" didn't pan out. As for me--I'd rather be conservative and be able to retire, not gamble on retiring.
     
  10. Oilpatch197

    Oilpatch197 Well-Known Member

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    Agreed, and the best way to save for Retirement is a $AVINGS ACCOUNT
     
  11. tsdave

    tsdave Grand Marshal

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    I think you should read your first statement, and your last again.


    Additionally, I believe your reply shows your a desperate man.
    I do wish you freedom, health, and life, but you cant take mine.
     
  12. Wannabee

    Wannabee Foggy Dew Farms

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    OK, here is my 2 cents: I don't want to end Social Security for people who are getting it already. I don't want to take anything away from them. But I DO want to guarantee that after paying for social security my entire life, that I will have some benefit when I am retirement age!!! Everyone says it will be broke in 2042. 6 years after I plan to retire. Then what??? I appreciate what Bush would like to do - let us keep SS going, but let some of us younger people opt to put SOME of our money in an indiavidual IRA - that amount they are talking about is only max around $1500 a year. A whole LOT MORE THAN THAT will still be coming out of my account and going to the current SS sytem that will not be around when it is time for me to retire.

    Do I want to get rid of the Babyboomers - No. DO I want to take away from their benefits - No. But why shouldn't the Babyboomers understand that I would like some of my own money to go to me as well??? I am in favor of the revamping of the system. Does Bush have all the answers? No - but at least he is asking the right questions!
     
  13. BackwoodsIdaho

    BackwoodsIdaho Well-Known Member

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    wow it all i can say at the moment.

    The idea that people should be required by the government, in the form of taxes to pay into a system for retirement is bad enough. But, to be required to pay into a system that is not an investment but is rather an income redistribution plan, is sickening. The idea of means test for paying out social security benefits to retirees is ridiculous - this was touted and sold as an "investment plan" therefore, your investment is available no matter what your net worth or income, is another socialist plan.

    If you extend FICA and Med taxes to "unearned income" then it reduces the incentive to have any at risk capital in the market or stock options.

    Jez, the people that want to call themselves homesteaders yet have their hand out for SSDI, medicare, medicaid really make me wonder what your definition of a homesteader is. Sorry, but in North Idaho, we take care of ourselves without expecting the government to take care of us - that is what a homesteader really is. A homesteader is not a leech on society.

    jim
     
  14. DAVID In Wisconsin

    DAVID In Wisconsin Well-Known Member

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    Social Security was never intended to be a total retirement plan. It is a supplement. SS is not welfare.

    We have worked and scrimped our entire lives. SS will be a small part of our retirement plan. We should have a decent retirement. If SS becomes asset based, most of us who saved anything will just move (hide) those assets. It's easy to do. I'd do it in a heartbeat. I don't want anymore or anyless than anyone who has worked and paid into the system for years.

    Duke's uncle may not be quite as happy to part with his gambling money as Duke seems to be. The man worked and he deserves to do as he pleases. Why penalize him because he was successful????????

    Tax unearned income?? We have ENOUGH taxes. I personally fight every tax I can. More taxes never solve anything. We are already taxed half to death. I would fight a tax if it's very purpose was for me personally.
     
  15. jack_c-ville

    jack_c-ville Well-Known Member

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    According to actuaries from the Congressional Budget Office and the Social Security Administration, there's plenty of money for the baby boomers and people our age as well.

    It is true that around 2012 the amount paid into SS will be exceeded by the amount paid out to retiring babyboomers. But that will not bankrupt the system. There is a Social Security trust fund with several trillion dollars in it. It was created explicitly for the purpose of getting Social Security through the lives of the babyboomers without it going bankrupt.

    The prediction that SS will be underfunded to the tune of $3.4 trillion in 75 years is, when you pick apart the math, based on the assumption that the percentage of retirees to working citizens continues to be what it will be in 2012. Except that the babyboomers are not immortal. Once a large number of them have passed away it all goes back to normal. This was predicted and budgeted for long, long ago. Ditto for longer lifespans. The actuaries knew even back in the 40's that it was going to happen.

    When they talk about having to reduce benefits in 40 years or so they don't mean reducing them to 70% of what they are now. The plan had been to increase the benefits considerably over the years (doubling by around 2040), even accounting for inflation and wage indexing. So when Bush tries to scare you by talking about cutting benefits in 40 years, it would still be 1.7x what is being paid today. He sorta forgets to mention this.

    Also notice that the worst-case scenario that even privatization's biggest advocates can come up with (using the misleading immortal babyboomers) is a $3.4 trillion defecit in the SS budget. Yet they want to 'fix' this by spending a total of well over $5 trillion.

    None of this makes any sense at all. I work in a financial services profession and all around me I see brokers and consultants salivating over the billions of dollars in fees that they expect this to generate. They have been lobbying for this for years. This is $5 trillion worth of pork to solve a problem that doesn't exist and it is disgraceful that this is being presented as 'conservative.' Time was when conservatism meant being, well, conservative with spending. An extra million here and there for an unpopular study or something would generate heavy rebuke from the likes of Newt Gingrich. Today they throw trillions around and act like it's nothing. Trillions that will have to be paid through - you guessed it - taxes. The whole thing is a monster tax hike down the road in disguise.

    -Jack



     
  16. BCR

    BCR Well-Known Member

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    I think privatization is too hopeful. I don't know any paycheck to paycheck folks who would say, "wait, that's my future, take that $50 and put it in an account, cause I don't need it to pay current bill collectors". I really think the general public is irresponsible with their money. Course that doesn't mean we should subsidize everyone for their stupidity. What happens if they invest poorly? Will there be a greater drain on Welfare rolls? You bet. It just costs us in the end.
     
  17. seanpecor

    seanpecor Member

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    I think that it's amazing how a few soundbites from both Democrats and Republicans are taken as established fact by their constituents and a goodly many people in this forum ;)

    I think some of the participants in this thread should reconsider how they communicate their perspective to others. While it may seem very tempting to reduce those who are pro-reform to the rich and greedy, and those who are against reform to the poor and needy, doing so ultimately hurts America.

    IMHO, Social Security needs to be maintained and must evolve in order to continue to be relevant for everyone with a stake in it. When it was created, the presumption was that working folks in the mid-20th century would be able to live off of their SS benefits once they retired. Back then, the economy being what it was, one man that we'll call Mr. Blue Collar, working a full-time blue collar job could earn enough to support his family of six or seven. Mrs. Blue Collar was a homemaker. Therefore, upon retirement, his SS benefit would allow him (and his wife) to continue to enjoy the same quality of life that they enjoyed while he was helping build the foundation of our countries' economy. In this the 21st century, both Mr. AND Mrs. Blue Collar must work full-time jobs in order to support their family of four. Everything from cars to houses to toasters is built to a much safer and more rigid specification. These safer products, and safer food processing methods, are good for our health, but terrible for our pocket book. Social Security as it stands must evolve to meet the challenges of our new socio-economy in order to remain something that people can depend on once they retire. It is a tragic mistake to disregard blue collar folks, simply by shrugging and telling them that they would have avoided their poverty in retirement if they had invested and saved their excess income over the years. Social security should provide security for the people who are the wheels and cogs of our economy.

    What should those evolutions be? I don't have the answer to that. But I'm confident that some of the top minds from all walks of life representing the entire political spectrum are working hard and all of liberal/conservative extremists will once again average eachother out and arrive at a reasonable solution that isn't perfect, but is as good as we can expect with a democratic system.

    I can tell you that I believe the wealthy need to contribute a bit more to the social security system than they are currently doing. I can say this as someone who currently sits in the second highest tax bracket, and is likely a year or two away from joining the 35% Club. Let's use Rich Married Couple as an example. Mr. Rich has a job that pays him $250,000 a year and Mrs. Rich is a homemaker who works a very very part time job paying only $5000 a year. He is taxed only on the first $110,000 of his income for 45 years, while his wife is taxed on her $5,000. When both retire, Mr. Rich might get $1,500 a month in todays money. But because Mrs. Rich qualifies for SS, and her husband made so much more than her, then she qualifies for half of his benefit in addition to hers. So, Mr. Rich earns $1,500 in benefits a month, and Mrs. Rich earns $800 a month. Sound fishy? It is, but it's a current loophole in the system that many rich folks (including me I suppose) will be taking advantage of when they retire.

    Sean.
     
  18. mikell

    mikell Well-Known Member

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    Why don't we have the government just pay back all the money it's taken out over the years to cover their *****. We would have more than enough money then.




    mikell
     
  19. stanb999

    stanb999 Well-Known Member

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    First and foremost SS is voluntary. Anyone who chooses not to participate is not required. So don't complain about paying. Second if the rate of tax was increased the wealthy would opt out. Do you really believe that Bill Gates pays into SS. Yes 110K would be about when people could tell them to pound salt if they really wanted to. Thats net reported income not gross income.

    Second The funds of SS are all "secured by federal bonds". To this i must ask. Who is responsable to repay these bonds? The american people. The same people recieving the benefit. How will this work?
    The money must come from the people being taxed. This will be the people working after 2012. The gov. doesn't have a pile of cash just sitting around waiting to repay these bonds.

    Get out of the Ponzi scheme before you lose more. You will lose. Just depends how much.
     
  20. BCR

    BCR Well-Known Member

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    SS is voluntary about like driver's licenses are voluntary. Great in theory but not in practice. As a self-employed person, if I were not to remit the SE tax owed for SS I would be sought after by the IRS quickly.