Social Security Reform

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@DW

I think Laches main point with the 0.9% is that less than 1% of the money taken in via SS is used to pay the people who work on the SS program. Which I admit, is pretty efficient. One thing I will say is this: Switching to private investments will come with a considerable cost. For one, SS isn't going to just go away. All those offices that are open now are going to remain open, because the baby boomers are going to collect SS just like everyone is doing now. And I imagine that SS will continue to pay survivor benefits as well, so those centers are going to stay open.

On the other hand, getting more people investing will require more specialists to handle these accounts. The difference is these people will be employed by private investment firms instead of the government, so this might actually be GOOD for the economy. I also think that people making lower wages and devoting 1% of their earnings into private accounts are NOT going to be paying the same service fees to investment firms as are people who have a millions dollars in the stock market. If so, then no plan on privatization would work, because it would take years of 1% investments to have enough money to actually do something with it.

 

Aldeth,

As you and I have discussed at length, this is not something to be looked at as and instant fix. This will have to be phased in slowly, and I will be the first person to admit that there will be costs, and at times the costs may exceed the current costs.

However, regardless of what the Democrats are currently saying, the system is breaking down, and it is doomed. There is going to be a light at the end of the tunnel, and it is our choice as to whether that light is the train, or the sky, meaning we can either start working on getting a better system that can sustain itself down the road, or we can let it go, pay as many people as we can, and then when it becomes prohibitively expensive, blow it up, and possibly the world economy with it.

This is not hyperbole or hysteria, the costs of SS in another 50 to 70 years could destroy the US$ by forcing the US Government to either devalue our debt or default on it, either of which would be catastrophic to the economies to many nations whose banks, businesses, and citizens invest in US debt.

 

Is America the only country that has SS? or an equivalent? I have a feeling SS will be around for quite awhile. A relative of mine - a Republican, corporate executive, hardcore capitalist - made stunning "confession" to me recently:

"You know all those ideas you liberals have about SS and national healthcare?"
"yes," I replied. "Would you like to hear them again?"
"Oh no, cause there is talk in our company about how great it would be if the government took over pensions, 401ks and the cost of worker healthcare. We could save millions if we could get the government to pick up the cost on all this. We could actually compete better with foreign businesses that are already in this situation, especially those in Europe."
"You mean all those liberal ideas could be good for corporate America?," I asked, more than a little bewildered.
"Yes, good ideas," he replied.

It's about time they figured that one out. It sure took them long enough.

 

Oh Chandos...there is no free lunch.

 

No one said there was, LNT.

 

Without meaning to go t:, but since Our Fair Moderator made the first mention of nationalized healthcare...

My F-I-L is a die-hard fiscal conservative, a true-blue Capitalist. On his last visit the topic turned to healthcare and his assessment is that this system is so badly broken that the only way to really fix it is to scrap what we have entirely, let the gummint run it for a while, and then slowly let it filter back into private sector control. The problem as he sees it is that health insurance companies are forced by their nature as corporations to show a profit every quarter, and it's gotten to the point where the only way for that to happen is to squeeze the life out of doctors and the level of care they can provide. There's no way for stockholder return and decent patient care to co-exist in the same space anymore.

Chandos, doesn't it feel great when a conservative realizes that some things are more important than the bottom line?

 

I agree. I think we were saying the same thing in different ways. While I was supporting Laches in saying the 0.9% is rather efficient, my point was that what we are spending on SS upkeep (regardless of whether you think it is efficient or not) cannot be the determining factor as to whether or not we change the system. Even if we were to scrap the whole thing and move to private accounts over the next several years, because all of the baby boomers will still collect SS, all of those offices are going to remain open regardless. Basically, the price of running the system has to be viewed as a sunk cost, because it's going to be spent no matter what type of reform takes place.