Re: Hey! Lets put our Social Security money into the DOW Stock Market and watch it vaporize!

<mpautz@xxxxxxxxx> wrote in message news:cb329f7b-f67b-4e3f-a32b-dc054780a54b@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
On Nov 21, 4:14 pm, "Nebuchadnezzar II" <nebuchadnez...@xxxxxxxxxxxxx>
wrote:
<mpa...@xxxxxxxxx> wrote in message

news:1798f69d-f1ae-455f-89ba-2691cfd1f552@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx



> On Nov 21, 12:01 pm, Salad <o...@xxxxxxxxxxx> wrote:
>> Gandalf Grey wrote:
>> > "True Blue American Liberal" <who...@xxxxxxx> wrote in message
>> >news:ErX0j.49440$HU1.3065@xxxxxxxxxxxxxxxxxxxxxxxxx

>> >>Great idea the shrub had there for SS.

>> > ================

>> > You first have to work and pay SS taxes before you can get SS you
>> > fucking
>> > trailer trash .

>> So the SS fund should be invested in the stock market?

> It's far better than giving it to your corrupt congressman.

> Prior to the early 80s, local governments had the option of opting out
> of SSA. I personally know of 3 counties that did that. They invested
> the payments into the private sector. All Three are far superior to
> what you can expect from your corrupt congressman.

> * Workers making $17,000 a year are expected to receive about 50
> percent more per month on our alternative plan than on Social Security
> -- $1,036 instead of $683. [See the Figure.]

> * Workers making $26,000 a year will make almost double Social
> Security's return -- $1,500 instead of $853.

> * Workers making $51,000 a year will get $3,103 instead of $1,368.

> * Workers making $75,000 or more will nearly triple Social
> Security -- $4,540 instead of $1,645.

> * Galveston County's survivorship benefits pay four times a
> worker's annual salary -- a minimum of $75,000 to a maximum $215,000 --
> versus Social Security, which forces widows to wait until age 60 to
> qualify for benefits, or provides 75 percent of a worker's salary for
> school-age children.

> In Galveston, if the worker dies before retirement, the survivors
> receive not only the full survivorship but get generous accidental
> death benefits, too. Galveston County's disability benefit also pays
> more: 60 percent of an individual's salary, better than Social
> Security's.

>http://www.ncpa.org/pub/ba/ba514/

SS is not a retirement program and it's not an investment program. It is a
social insurance program.

The whole of the US can't switch from a pay as you go program to an
investment program, because if that happened there would be no one to pay
the benefits of the current retirees. That's why Bush's crackpot idea was
doomed from the start. The stuttering subliterate Bush never could explain
where the $2 trillon was going to come from to fund his stupid idea, and it
was only a partial investment scheme.

I agree with 2 out of three:

It is NOT an investment program
AND It is a social insurance program

One of it major parts IS a Retirement program.

Well, if you want to retire with the bare minimum needed to survive, then yes it could be considered a retirement program by some who aren't too smart, but that was never its intention. It was intended to keep old people from becoming homeless and eating out of trash cans which was a big problem at the time it was implemented. Nevertheless you can't compare it with an investment program because it's not a valid comparison.

I understand what you are saying about the problem of changing from a
pay-as-you-go to a partial investment program. I disagree that it was
a crackpot idea. The Democrats were trying to fix the system long
before Bush took over. After the democrats lost the White House, no
democrat would ever admit to having said that SSA needed fixing.

The SSA doesn't need to be fixed.

The 1997 SS trustees' report said SS would exhaust the trust fund in 2029. The 2000 SS trustees' report said SS would exhaust the trust fund in 2037. The 2004 report said the trust fund would be gone in 2042.

See a trend here?

The SS trustees have never used realistic figures for economic growth. They use a growth figure for the next 75 years that's lower than any 75 year period in the last 100 years (including any period that covers the great depression). The CBO uses more realistic growth figures and their date is 2052, but even the CBO uses growth figures that are lower than what the country has averaged over the last 75 years. So to believe any of those dates, you have to believe that the economy is going downhill over the long term and by downhill you'd have to assume another depression or some other catastrophic event. If that happens all bets are off anyway. The SS trust fund is only intended to bridge the baby boom gap. 45 years from now, there's not going to be too many baby boomers left alive to worry about.

The SSA is not completely a pay as you go. Back in 1983 the "fix"
assured that the SSA had a surplus. Unfortunately, the government was
REQUIRED to "invest" in government bonds. I put the "Invest" word in
quotes, because it is NOT an investment; the government spent the
money. The government looked at the SSA Trust fund as one big bag of
candy.

The SS trust fund didn't cause the government to spend more money. If the government wasn't borrowing money from the SS trust fund, they would be borrowing it from somewhere else.

If the government had invested the surplus in the private sector
starting in the 80s, we would have a true trust fund.

The US stock market averages about 9% per year. Gov securities pay about 5-6%. For that extra 3-4%, the trust fund would have to assume more risk which most people in this country would find unacceptable. Each time the stock market had a bad year you would have a public outcry to take the money out of the stock market. Most people don't own stocks and even fewer understand them. If the SS trust fund wasn't invested in government securities the government would be paying a higher interest rate. Investing the SS trust fund in gov securities was not a bad idea.

Because of inaction in the 80s, our options are now limited. We
(1)bite the bullet now, start a "real" investment program and reduce
government spending accordingly. or ( 2) ignore the problem now and
bite the big one in the future. If we decide to bite the big one in
the future, we either tax the hell out of the young people to pay for
the baby boomers benefits, or we reduce benefits, or we delay the age
of collecting benefits (once again).

The age of collecting benefits has only been changed once to 67 (only 2 years more) and even that affects almost none of the baby boomers. There was nothing wrong with the change as it reflects the longer average life span.

As I demonstrated, there is nothing that needs to be fixed with SS. It will operate just fine indefinitely with no adjustments.

There is about $2 trillion in the trust fund right now. Bush has almost spent that much on his so-called "war on terror" in just 5 years which has no end in sight. If you also include just the increases in non-defense discretionary spending, Bush and the Republican congress has spent far more than the entire SS trust fund in the last 6 years. If you really want to do the best thing for SS, the best and smartest thing is to NOT elect leaders that are spending this country into bankruptcy. Even if you believe the SS trust fund will run out, Bush has saddled young people with far more debt.

.