Re: "Critics cry foul in Bush Social Security maneuver"

Jeffrey Beaver wrote:

Thumper <jaylsmith@xxxxxxxxxxx> wrote:



On Wed, 15 Feb 2006 10:56:33 -0800, Jeffrey Beaver
<anyonethere@xxxxxxxxxxxx> wrote:



Alan Lichtenstein <arl@xxxxxxx> wrote:



Orion Ryder wrote:


Hello js,

I welcome myself once again to your speak.

Are you saying that you personally would be willing to forgo
contributing to/receiving from a SS fund and just contribute to your
own 401K type of SS fund?

Hmm, let's see. Nothing wrong with that.

You are knowledgeable about planning the future based on economic needs
AND You understand the make-up of earnings and inverstment earnings.

What about Joe Blow Sixpack? Or my mom? Or my teenage stepson who does
not know jack-diddley and would have to be spoonfed the answers?

Hey I don't have problem with self funding. But I also don't have a
problem with some type of government funded one.

And yes the pay-as-you-go is pretty much at a got-up-and went.

Alan says he fosters the idea of change.

I expect his idea of change is "transition".


the only thing js says that makes sense(although he doesn't really knowWHY, because his goal is selfishness ) is that money must be invested.

Sorry Alan, but that was a bad idea the last time you recommended it,
and it still is. I don't have a problem with individuals investing
their own money, but then we return to the problem of those same
individuals being forced to accept the consequences of unwise
decisions. A basic government funded retirement system supplemented by
tax incentived private accounts like our current IRAs, 401Ks, 403B's,
and the like, is the best we can currently hope for.

Wrong. All risk is assumed by the individual and we know that many
will never make enough to support themselves in retirement.
THumper



Oh, I agree, but the current state of the world being what it is I
don't see that we have the ability to support a retirement system of
the size you seem to be proposing. We can't even support Social
Security, let alone something three times as big. Maybe sometime in
the future, but not now. Until then, some people will just have to
rely on family and general assistance.



It'll have to be way out in the future. I don't see how we can get the deadbeats on the left geared-up anytime soon.





The Ponzi Scheme,
woefully inadequate though it may be, is still the best approach for a
basic safety net system.

Briefly, here are my objections to your stock market idea. They
haven't changed. Your counter arguments probably haven't either, but I
would remind you that public employee retirement systems of the kind
you favor are in trouble all over the country. There is no need to
magnify those problems by a factor of 100.

1. Huge amounts of publicly controlled and influenced money in an
ownership position in the US economy would result in an irresistible.
urge to meddle in corporate policies. (You might like that. I don't.
We don't need another Europe through the back door.)

2. In the not impossible event of a long term decline in equities
(witness Japan), the tax payer would still be on the hook -- perhaps
to an almost inconceivable degree. The resulting national hysteria
would inevitably result in meat head politicians trying to boost the
stock market and almost certainly having just the opposite effect.

3. Periods of rapid equity growth would result in irresistible
pressures to increase payouts to retirees from a seemingly bloated
fund -- eventually resulting in over commitments and scenario #2.

I suggest we just boost the payroll tax, nudge up the ceiling on
contributions, tweak the COLA, and expand the retirement age to keep
pace with increases in longevity, and all will be well. There is no
need to risk a national calamity which in the age of a global economy
would have world wide implications.

Jeff



Virtually every pension plan depends on the principle of money growth. Social Security doesn't. The best way to describe it is that it works like a Ponzi scheme, although the intent wasn't to defraud, as it is in a Ponzi scheme.

Briefly, and js likely does not know, understand, or even care to understand, a ponzi scheme does work, initially, because there are larger numbers of individuals paying, at the bottom of pyramid than receiving at the top. As more and more numbers of people are added to the top, you need to add exponentially to the bottom. Given the fact that up until recently, we could expect that growth at the bottom due to population increase, the top increased as well, due to improved medical care, and other environmental considerations. consequently, Social Security's funding mechanism, always flawed, is failing.

Add to that the fact that the Government appropriated, and has been doing so, for a long time, surpluses, and now will have to pay back those surpluses, why selfish individuals like js just can't STAND to have their taxes raised to pay back that debt. I find that position quite humorous in consideration that js has no problem supporting current tax cuts which create even larger deficits for future generations to pay back. Likely js doesn't really care, because HE won't have to pay back those future deficits. Which is why his position is contradictory and i correctly label him and his ilk, selfish and greedy.

I have always advocated the concept of money growth for Social Security, and that means investment. but unlike js and the greedy, selfish and superstitious so-called reactionaries, I advocate investment as a fund. Funds spread the risk over larger numbers of individuals, reduce the need for personal expertise in investment and take advantage of more favorable mortality tables and thus actuarial factors than any single individual can. Couple that with the fact that there are excess contributions in a fund from individuals who will never collect, why that even makes the fund concept more profitable for everyone else. js really doesn't understand those actuarial principles, has no understanding of the formulas that calculate those data which he loves so much. Ignorance is what happens when a fool gets hold of some data that he really doesn't understand, yet insists he does. That, in a nutshell, is js's position.

Transition from the current system is indeed a problem. However, if the transition is made now, while there is still a surplus, such a transition coupled with a simple removal of the ill-advised Bush tax cuts will solve the entire problem, period. In fact, if you recall, that is EXACTLY what economists were saying after the surpluses of the last two Clinton years. Had Gore been elected president, that is very likely what would have occurred and we wouldn't be having this discussion, although the funding problem would still remain.

If you wish, I would be happy to engage in a discussion of the issues with you, as per your question below. The issue is not so simple as js, in his simplicity of thought appears to believe.



So who has the best answer on hoe to make the trasition. I think a lot
of theories are going to have to be looked at.

Orion



"The moonbats bark thrice at midnight."




"The moonbats bark thrice at midnight."


.

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