Most GOP Plans to Remake SS Involve Deep Cuts to Tomorrow's Retirees

Most G.O.P. Plans to Remake Social Security Involve Deep Cuts to Tomorrow's Retirees

As President Bush gears up for a major public push to overhaul Social Security, he has focused almost all his rhetorical energy on the need to let people divert some of their taxes to private retirement accounts.

But nearly every leading Republican proposal on Capitol Hill acknowledges that private accounts by themselves do little to solve the system's projected shortfall of at least $3.5 trillion. Instead, those proposals rely on deep cuts in benefits to future retirees.

That uncomfortable political truth was driven home on Monday by the head of the investigative arm of Congress.

"The creation of private accounts for Social Security will not deal with the solvency and sustainability of the Social Security fund," that official, David M. Walker, comptroller general of the Government Accountability Office, said in a speech on Monday.

Or, as Thomas Saving, a Republican-appointed trustee to the Social Security trust fund put it last week: "Fundamentally, if you don't reduce the benefits, you don't reduce the debt."

http://www.nytimes.com/2004/12/14/politics/14social.html?oref=login

The rest of us should be exempted from the whole thing.

sell the idea of privatization. This whole article stinks of RW propaganda. Roll taxes back to before Bush's tax cuts and you see a much different picture.

My guess is the people born between 1964 and 1980 will suffer the most. And that's assuming we have 50 years of uninterrupted GOOD stock activity for the young to get good returns on their private investments. Otherwise, everybody suffers. Nobody wins. Least of all the high risk stock market.

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invested in creating the current social security system.

safty net for the elderly, and disabled. If you take out some of the workers--or even some of its money, you make the pool even smaller (which has been one of the problems over the years).
We have an individualist mentality in the US--not a mentality for the "common good"!!!!!

You sure you meant it when you said "we?" LOL!

You might want to do some reading up on just what taking that money out will do to Social Security. Heartless.

you and your family deserves it

People's savings have been wiped out -- completely. The purpose of social security is not to create YOUR nest egg, but to insure you have money set aside to take care of your basic needs when you are no longer in your money-making years. Please note, that this is a safety net for SOCIETY. Because, if you lose that money by investing it in a market that has never shown a consistant upward trend, WE THE PEOPLE will have to take care of you in your old age. We'll have to spend the money anyways, one way or another. Bush's plan is no plan. It's gambling.

Also, another point to remember. If we were a truly socialistic country, WE would be deciding how you spend that money in your old old age. For now, it's up to you to make those choices.

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Well...first of all, look at reality and facts on playing the market with your and your kids retirement 'investment' vs. putting it into the SS. 'Investing' might give you a higher rate of return, true, but there is as much of a chance that just as you're about to retire there's a crash and it's all gone. Will you be expecting the government to bail you out?

Second, there is nothing stopping you from investing now.

Third, you will leave a large hole in the system for a large number of people who, by sheer luck of being older than you, never had the time to 'invest' as you did.

in order to fund this fraudulent scheme, your gains in a good year are limited to 6-8%. The rest of the gains are to be used to fund transition costs -- there's a trillion dollar shortfall to be made up. So in the down years, you wont have that extra to cover for a loss of return.

Second of all, the fact that you can buy a security with a good rate of return means that someone lost the opportunity to make money on it. There are winners and there are losers. As a finance instructor of mine said, "there's no such thing as a free lunch".

Third of all, where's your generosity towards the needy. Remember there are going to be losers in the marketplace. I tell ya, a sandwich a money from your church just doesn't replace the thousands of dollars of Social Security. Boy, I'd really hate to be dependent on my church ... for a wealthy parish, we just aint that compassionate to give thousands of dollars a year to even one needy person.

Fourth of all, my husband and I are eligible, under current rules, to receive $30K a year from Social Security. Let's say we live to be 85. That's a $600K shortfall that needs to be made up somehow. Got any ideas how someone can make up that kind of money in a 20 year time frame. And I mean a zero risk, highly conservative strategy, guaranteed investment that will be there for us even in a down market. Not junk bonds or commodities.

What's so darn wrong with extending payroll taxes to people making up to $300K. Why not a nice progressive tax so that the people who got us into this mess are paying for getting us out of it?

Ah, yes, you are part of the "I got mine" crowd. A Pharisee. Compassion is not one of your moral values. Real compassion is forking over thousands of dollars of your income for someone else in need. I guess if someone in your family is in real need, you wont be forking out say, $10K a year needed to make up for a decrease in government benefits. You will let your relative rot in degradation.

I'm assuming that maybe you are just misunderstanding what Social Security is. It is not, nor was it intended to be an investment account program. That is, your money doesn't go into an account and wait for you to retire. Instead, it works like insurance. The money you pay in today is used to pay out benefits to others today. And it is not just for the retired; if you were to become disabled and unable to work, you would be able to receive benefits from Social Security, provided you have paid some minimum amount into the system. In contrast, if SS were an investment account, then you would be in some serious trouble if you became disabled and had accumulated only a small amount in your account.

So the reason that diverting Social Security contributions into private accounts is a bad idea is that then the money will not be available to pay the promised benefits to todays retirees and disabled. The government would instead have to borrow that money. Most would agree that increasing our collective debt and leaving massive debts for our children to pay is a bad idea. Unless your motive is to bankrupt the Social Security system and along with it the Federal government, in which case you would favor it I guess.

This doesn't fit on a bumper sticker, but it's not that hard for people to understand if it is explained carefully, something the media declines to do. I'm sure others can explain it more plainly and concisely than I, but that's it as I understand it.

I hope you enjoy your stay at DU, however long or short it may turn out to be.

Uhhh...how are you going to pay for that?

It's a safety net so that the less fortunate are not forced to eat dog food as they age. Plus, this is much ado about nothing, SS is fine for another 40 years. If Bush had used the trillions in surplus he inherited from Clinton to shore up SS instead of giving it to the very rich, there would be no problem. Al Gore's "lock-box" doesn't sound so crazy after all, eh?

The money won't be there when the time comes for your kids because kids don't care when they are 18 years old about retiring. That is why Social Security was designed and set-up the way it is now, because of the potential and probable crash of the stock market and the absolute failure of many to save money. If the average person is worth $1200 how far long will they last?

You like gambling with your future and your children's future I take it? You like the idea of having to pay for a care for your parents? Being so many never liked this idea, many parents were not cared for properly during the years prior to and during the Great Depression. If it weren't for social security, they would have ended up on the street I guess and we'd truly be a 3rd world country by now. Is this what you really want?

Do you really have that much confidence in the stock market? I DON'T!

:kick:

Don't you?

Your money goes into the SS fund, paying for current retirees, NOT into "your" retirement kitty.

So, to answer your question, take 1/3 of your SS payments out (and everyone else's) and leave SS with a shortfall, because you are transferring Social Security money for today's retirees to today's workers.

Also, I believe the privatization plan does not involve making your payments smaller or sending you the money. IIRC, your payments will be steered into the private accounts set up by the govt. and managed by Wall Streeters, if you choose the partial privatization option. You won't have complete control over that money.

Why is it a big issue? Because it increases risk, creates a SS deficit that will require govt. borrowing ($2 trillion, I believe), increases the odds of reduced benefits and/or higher eligibility ages for SS, gives a boatload of money in management fees to Wall Street (hey, Bush's buds, who'd a thunk it?), and doesn't give you full control anyway.

have to pay as much for their half of the SS money put in. We only put in half - supposidly. Another reason for the rush to outsource jobs - no SS payments.

If the relatively large number of boomers have been working and paying in to SS for the past 25-30+ years to support the relatively smaller number of their parents and grandparents, it seems they would have paid in more than was spent. This (theoretical) excess would now be used to offset the shortfall created by the relatively smaller number of workers now paying in to SS to support the boomers. Where'd the excess go? Tax cuts?

It always amazes me how the repubes are so successful in getting media to twist things for their benefit.

SS is an inter-generational bargain.. We'll help the ones who are old NOW, in exchange for getting help when WE are older.. That's all it's ever been about. People who are working NOW, helping people who are unable to work due to disability, or orphaned as a child, or too old to work..

Republicans have ALWAYS portrayed SS as "welfare...entitlements...greedy old people leaching off the young...lazy people on the dole, who could be still working.. etc..."
They have succeeded in switching the argument from what it should be..

WHY DID THE GOVERNMENT EMBEZZLE THE MONEY THAT WAS WITHHELD FROM MY CHECKS FOR ALMOST 50 YEARS?...AND WHY DON'T THEY JUST CUT THE DEFENSE BUDGET FOR A FEW YEARS TO PAY IT ALL BACK?

That would make it "all better" again..:)

on Washington Journal this morning, I was amazed to see how DENSE the "financial expert newsman" guest was.. He constantly hit on the talking point of how "little we save" compared to Europeans.. What he FAILED to mention, is that in MOST European countries where savings is high, they also have socialized medicine, and a state supported college system.. When people do not have to pay HUGE medical premiums and prescriptions, and try to help pay for exorbitant college costs, they might just have a few bucks left over for savings..

There should also be NO CAP ....

We're the first generation who has done that. That's the surplus and that's why it was supposed to go in a lockbox. Bush gave away our retirement to the wealthy and now wants people to suffer even more while poor shmucks put their money into the stock market which will drive stock up even more for the wealthy. With the eventual goal of destroying SSI altogether.

and had to bite that bullet during times with DOUBLE DIGIT inflation and interest..

The "surplus" was social security money...THAT's why it was so important to set it aside for the future obligations..

The Boomers are the FIRST generation with so many obligations put upon it.

There are Boomers who still have GRANDPARENTS who are living..So we are essentially paying the bills for the increased longevity of our elderly, and still paying for our grown children, who at 20-30 are having a hard time getting launched into a tight job market.. We are getting squeezed harder than any other generation.And yet, we are still expected to "save up" for our own retirement..

The boomer generation missed out on the company pension benefits.. Most of those ended with our parents' generation..and union jobs were pretty scarce by the time we arrived on the scene too, so most of us don't have that option..


Perhaps we need a class action suit with ALL of us...suing for our "stolen money" to be returned to us :)

The only people who will make out on the new "scheme" .. Wall Street..

and for you "babies" out there who think you'll retire rich if SS is privatized... Dream On.. There will always be republicans who are salivating at the thought of all that money, just asking to be stolen.. They have done this every generation since the 1880's and they aren't gonna stop anytime soon :(

I would advise all the young ones to do what the president keeps saying HE did.. "Marry well"...(look for one with lots of OLD money)

I'm 47. I think you're older, not sure, but the 55+ boomers had it slightly easier than we did. At least the ones who got into those union jobs before it all crashed. And the ones who got into the job market in the 60's; by 1975, the job market was plummeting but I was too stupid to know it. We could only wander around the country going, "huh"? That's how Reagan got in, I'm convinced. Did Carter ever once say, "hey there's MORE boomers than jobs"? I didn't hear it. I know what you mean though, blamed for everything when we're the ones who've been willing to make the change and sacrifice because we were raised to respect our elders AND want to do better by our kids. If I hear one more kid say we destroyed the environment, aaargh!

The Republican rich will always be there with their hands out, even as they drive the country to penury. (There are plenty of decent folks with money; they generally have no problem with this.)

Kerry warned the voters about what Bush would do to SS, but Bush and the media misled Americans into believing that Kerry was exaggerating when he said that Bush's risky private account plan would not only be expensive to implement but cause cuts in future benefits.

Makes me furious to hear about Bush claiming a mandate to push through his bad policies, when to get elected he downplayed and lied about what he planned to do!

You don't fuck with a program that provides at least a minimum of retirement security most Americans. You don't replace that with something risky, that you aren't even willing to pay for. They have gotten away with so much, they think they can get away with this. But they won't.