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CBO says Social Security is in trouble

Discussion in 'Economics, Business, and Taxes' started by lupehernandezdepedajack, Mar 19, 2014.

  1. lupehernandezdepedajack

    lupehernandezdepedajack Mayor

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    Last edited: Mar 19, 2014
  2. Klunker

    Klunker Council Member

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    1.) Continue raising the full retirement age. Life expectency is increasing, due to the miracles of modern medical technology.
    2.) Set a maximum you can earn at full retirement age and not be penalized. Currently, if you begin to draw before full retirement age you can only make just of $14,000 without paying a stiff penalty. Once you reach the full retirement age, you can make all you want. I know some college profs who are still teaching at age 70+... making well over $100,000/year... and drawing full social security benefits.
    3.) Phase out the social security disability program. Social security was originally designed as a "safety net" at retirement age. Today, there is substantial corruption as people begin drawing disabilty payments at a young age. Return the program to a "retirement only" status and it wouldn't take long for the program to "get well".
     
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  3. Wahbooz

    Wahbooz Governor

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    I'd start by telling them to recognize the nearly $3 trillion in Treasury Bonds that is in place of the surplus taxes that were collected for years and years.
     
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  4. fairsheet

    fairsheet Senator

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    My car's down a quart. If it continues to consume oil, my engine will fry at that will cost me a small fortune. Or....I can just add quart of oil now.

    The top-linked post tells us what we all should know already. If we do absolutely nothing in terms of revising Social Security, some time down the road, it's going to morph into a problem with really big numbers. He suggests that in order to fix the problem, we'll need to cut benefits and/or raise taxes. I think we can file THAT little bit of wisdom under, "Duh!"

    What he does NOT opine as to - presumably because he wasn't asked to - is just how relatively nominal those cuts and/or increases would need to be, to fix the "problem".

    EVERYbody already knows that Social Security faces some "issues". I'd challenge anyone to refute this. Therefore...the top post is just one more example of wasted byte space on this issue. Unless some opiner follows his or her sky-is-falling Social Security treatise with ACTUAL, plausible, and tangible solution, I suggest we all tune out.
     
  5. Joe Economist

    Joe Economist Council Member

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    What the man is saying is that any funding will come at the expense of other programs. So when you say funding it, what are you willing to give up. Paul Ryan has just outlined a plan to cut 5.1 trillion dollars of spending, not one penny of which came from Social Security. So he is really suggesting that Social Security be given a higher weight within the priorities of government.

    You may say that they deserve it, but whatever "it" is will come at the expense of something else like head-start and student loans. I think you are going to have a difficult time selling that concept to younger workers.
     
  6. Joe Economist

    Joe Economist Council Member

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    OK we can recognize that money. I think that the question is how are you going to fund the other 23 trillion dollars of promises for which the system will not generate cash.
     
  7. Joe Economist

    Joe Economist Council Member

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    Once you do 1 and 2, you really don't have Social Security as it was designed. Social Security is about old-age and it was specifically stated that it should not be means-tested, ie welfare. Why are you going to keep the name and end the system?

    Changes in life expectancy in the past are not part of the crisis : http://www.politicaljack.com/posts/991452/
     
  8. lupehernandezdepedajack

    lupehernandezdepedajack Mayor

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    First there should be no permanent cap on income that is taxed for SS just as the SS recipients get cola's the cap should go up
     
  9. fairsheet

    fairsheet Senator

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    My suggestion remains that we should levy the payroll tax against ALL income, to include capital. If we did that, we could lower the rate rather considerably. And yes.....1% or 2% would end up paying more - some, much more. But, the other 98% will realize a reduction.
     
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  10. Joe Economist

    Joe Economist Council Member

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    And the solution to the problems of Social Security Disability is raise tax on the rich, and the problems of Medicare is to raise tax on the rich. And the solution to the infrastructure, student loans, and zzzzzzzzzzzzzzzzzzzz is to raise taxes on the rich. And the solution to the debt is to raise taxes on the rich. This is a bit predictable.
     
  11. Joe Economist

    Joe Economist Council Member

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    There is no permanent cap on SS, it is automatically indexed by wages.
     
  12. fairsheet

    fairsheet Senator

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    Yes....thank you. Although....for a price, I could've saved you the time by crapping your rote response for you, Joe the "economist".
     
  13. Jen

    Jen meh

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    Or maybe they quit using money designated as SS payments for other things and pay back what the government has stolen from the SS fund. I'm betting that would sustain it.
     
  14. Joe Economist

    Joe Economist Council Member

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    You would lose the bet according to the Social Security Trustees. In a good economy, after every penny is repaid with interest, Social Security carries about $23 trillion dollars of promises for which the system will not generate cash.
     
  15. Jen

    Jen meh

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    Well, then, in that case...................we'll just have to snuff out the Boomers.
    Ever see the (old) movie Logan's Run?
    It's beginning to make a little sense now, isn't it.....:eek: Old people just suck out all of our money.
     
  16. Wahbooz

    Wahbooz Governor

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    First of all where does that figure of $23 trillion come from? If it comes from those who have been out to destroy Social Security for ages I would question and investigate it very seriously.

    And while some of us recognize that figure of close to %3 trillion, there are way too many who do not.
     
  17. Wahbooz

    Wahbooz Governor

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    You have to remember that raising the taxes on the rich will make the sky fall and the economy tank....... like it did under so many Republican presidents when the tax was 90%. Oh wait, did it?
     
  18. Joe Economist

    Joe Economist Council Member

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    What I see in general is the public's belief that what exists today will always work. There are 23 trillion dollars of broken promises in that system. At some point, those broken promises will fall on someone.
     
  19. Joe Economist

    Joe Economist Council Member

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    The figure comes from the Trustees of the system who have urged immediate reform for years. Having worked with the subject for years, I find no other source that is as reliable. They make mistakes, but at least they are not paid to make mistakes.

    The 3 trillion is the 'surplus', which is cash onhand. Technically it is a reserve against 27 trillion in promises for which the system will not generate cash.
     
  20. Joe Economist

    Joe Economist Council Member

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    The tax was 90% when the tax structure included deductions and corporate tax rates that were basically nothing. No one who was bright enough to keep their body warm paid 90%. Either you know that, and are delibrately trying to mislead people or you don't really understand the economics of taxes.
     
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