I like the idea that Herman Cain had last night about Chile's system. Allow people to opt out of the current system and have their own account in their own name. What are your arguments against that? You can buy disability insurance if you can't go back to work-obviously in advance. Why not shift the model to one of personal responsibility?
Because we know, for a fact, that many people are rather bad at planning retirements and the stuff they invest in can be quite volatile? Because many people, particularly those with lower income or more kids, will prioritize current spending over saving if not "forced into Social Security"? It's all well and good to talk all Randian, but the bottom line is that if we do as these guys propose with Medicare and SS, we end up with tons of old folks in complete poverty and with no access to medicine. Now, some of them will be wise and/or lucky and end up with comfortable retirement portfolios, but many will not and will be much worse off than under a collective system like SS/Medicare. Now, this may be the reality in many parts of the world-- and you can argue that we shouldn't be bothered one bit by widespread poverty among seniors on the theory that these people made bad choices or had bad luck and are getting what they deserve, but lets at least face the fact that this is what ill happen if you just shift the "responsiblity," burden and risks to individuals.
For Herman Cain to be such a whack job, it almost saddens me to agree with his Chile retirement position and his 9-9-9 tax plan. i was also hoping Santorum would weakly try and rag on Paul again so we can see Paul slap him down again.
Sadly I'm not the most caring of person, I'll readily admit that, I think I could handle the money I've put into SS better than it's being done right now, considering I'm mid 20's I probably won't get back every dime I put in. My mindset is, I shouldn't lose the money I assuredly will by letting it wallow in SS simply because people, while it is in the millions, can't manage it themselves.
That's not really the Chilean system. The Chilean system is more or less the Bush privatization plan for Social Security with some caveats. The issue with opt-outs is that Chile's system is unsustainable due to the fact that the system is market dependent and by law they have to liquidate funds in poorly performing funds and eat the losses (which means some extra government debt to cover the difference) and that higher wage earners have a tendency to opt-out which means funding is generally from middle income and poorer workers. And considering Chile has a minimum pension payout, the system is unsustainable in poor market conditions. If he wants the Bush social security plan then he should come out and say it instead of saying some nonsense about Chile. Chile's is the Bush plan designed by Milton Friedman monetarists from the University of Chicago. And we all know how popular the Bush plan is in the United States.
What did he mean by 9-9-9? He kept saying his 9-9-9 plan but he didnt actually explain what that meant?
It's all well and good not to care about other people. However, if your retirement investments don't turn out well-- due to your mistake or bad luck (examples: investing with Madoff, sudden market crash, prolonged high inflation, unforeseen costly illness outside of insurance coverage), do you just plan on killing yourself rather than become a burden to society (by, for example, begging on the streets and depressing my property value, going to emergency rooms for medical needs, etc.)?
He wants to wipe out all of the tax codes and replace it with 9% on Corporate and Personal tax and a national 9% sales tax.
I hopefully will rely on anywhere from 80-90%+ of my retirement income to come from my own investments, that's what my aim is. I'd start investing it away now, considering I have 40 years until retirement, I can easily withstand some volatility.
Well that is one way to do it. Let's put it to a referendum to US voters. We could so to the existing scheme, maybe even a year or two to the age to colect the full check. This would sort of be like the minor reforms made by conservative hero Reagan done before the conservatives got Tea Party bat crazy. Of course we could just add some general tax revenues and bail it out like we did the bankers. Let's put that to a referendum. I suppose it might be tough to pass it with a Congress beholden to the top 1%-- the type of system you obectively support. It must chape you that social security is so popular except for conservative ideoogues. Shouldn't you couch your attack on the system in faux claims you are tryng to save it like Paul Ryan and other GOP enemies of social security?
I'd agree with that sentiment. I guess my interpretation would be that it would be more of a money market type account that is not in volitle stocks or funds. The individual and employer could maintain the current % of their income they pay on social security but pay into that person's money market account. The consumer could then decide with what bank he wants to park the account giving banks further liabilities but also increasing their ability to make smart loans, if such a thing is still possible-though with certain mobility rules. I wouldn't imagine this idea to be like a 401k where people can just transfer their money around to different funds and pull out what they need when they need it. It would be untouchable as SS is now, forcing retirement savings. I don't like a nanny state but this is just good policy for people's own good. Part of that money could also be a forced long term disability policy so it pays if they get hurt but people would have the option to contribute more to replace more income if they so choose. The thing i like about this is having the account in my name and being able to know it is there and giving me the ability to park it with whatever bank I choose. The problem I have with SS at the moment, is it just a big general fund that I just don't anticipate being there in 35 years when i'll need it. I'd imagine something like this could satisfy both sides if the system were to be overhauled from its present federal liability.
The last time we had this "let's move all SS funds to private markets" talk, it was 2005...the apocalpyse that would have unfolded in 2009 had this happened would have been incredible.
So you trust the FDIC, but not the SSA? It's a shared risk however you cut the pie, so why add another layer of money handlers between you and your cash? The biggest threats to Social Security are schemes like yours and the self-fulfilling prophecies they generate.
I'm somebody that is holding out that eventually, some politician will come along who is not influenced by the banking sector to completely undo this piece of legislation in its entirety: http://en.wikipedia.org/wiki/Commodity_Futures_Modernization_Act_of_2000
Make it 100%. Social Security is a pay-it-forward kind of favor. We help today's old people and maybe some working-age stiffs will help us when we're old. Keeping old people out of the poorhouse today is a benefit to us now anyway. But, you don't want to plan your investments on favors people may do you 40 years from now, even if you know they'll at least feel some sense of moral obligation. So plan to not need it, and be glad it's there (if it is there) if all your plans blow up in your face.
"Sadly?" You seem a bit proud of being "not the most caring person." You have a problem with Social Seciurity. Well chew on these numbers. Poverty among elderly Americans was endemic before the program was created in 1935. The first benefit checks weren’t issued until 1940, and as late as 1959 more than 35 percent of the elderly were living below the poverty line, according to the Social Security Administration. In 2009, the most recent Census Bureau data available shows, the figure was 8.9 percent. http://www.bloomberg.com/news/2011-...es-fraud-in-long-popular-social-security.html I hope your parents, if they are living, are well set for their retirement, because the safety net they will have, should any investments they are depending on go south, and they are without Social Security and the other Federal programs that help seniors stay out of a bread line and keep them from sleeping under a newspaper on a park bench, is you.
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Social Security though isn't about just saving people from themselves. Having an endemic elderly population in poverty puts a strain on society and the economy. A lot of these "nanny state" ideas actually help more than just the people they are trying to save. For example reducing smoking helps reduce health care cost by lowering the need for many people to use resources that could be used in other ways.
