Pitiful portrait

[Guest 6.8 AR]

I'm 56 and I don't expect to see a dime out of SS or my Railroad Retirement, the way

things are going. But I quit expecting SS twenty years ago. This stuff has been going

on so long about the budget. Really those pie charts have looked bad for years.

I think OS hit it about right. It's been a so called actuarial nightmare of an insurance policy

that was never really funded with anything but IOU's since it's inception. Ponzi. I doubt

the gov would be able to do anything for it without revamping a lot more than just SS.

Just imagine some wikileak about all of the stuff FDR hid. You could probably replace those

initials several times over with the same result.

[JayC]

And where does the government get money to pay for the baby boomers SS?

If I'm getting 15% of my pay to invest as I see fit, what other taxes am I paying to let baby boomers to play golf in Florida on my dime for the next 20 years? And what happens to the pile of money I've already paid into the system for the last 20 years? Just considered it a gift to the government?

The solution must require everybody to take a haircut... SS needs to be reduced for the baby boomers to provide just enough money for food, and shelter and nothing else... In 2010 the poverty line for 1 person is $10,980 in the lower 48 states.... Which is about $211 a week... That provides a safety net to make sure people in retirement aren't going hungry or being kicked out of a place to live. While not causing a huge tax/debt burden on the next 3 generations.

It wouldn't be fair that the people who paid in to SS for so many years get nothing back. It also isn't fair that the young folks have to bear such a burden. At this point many will say "life isn't fair, someone is going to get screwed"

I say that it doesn't have to be that way. I think SS withholding ends at 104,000. End that practice and SS is solvent for 70 more years (or something, I'm not quite sure). It really makes no sense to to make something better for 70 years if it is just going to fail then.

So, with the 70 years the government just bought, we can move to privatizing SS. You'll still have to set aside 7.5% of your paycheck for retirement (and your employer has to match it) but instead of necessarily getting it back from the gov you can self direct your investment. You want a safe investment you are free to finance the government with TBills. You want a better return? You could invest in the stock market or whatever. You just want to let it grow stuffed mattress style, that is fine as well.

In this fashion neither the young or the old are truly screwed.

[Guest 6.8 AR]

Gets real complicated real fast, doesn't it? The whole tax structure and the whole idea

of retirement has to change. There is no way you can get around this problem.

[Guest nosnos]

It IS complicated, but we're trying harder on this forum to come up with solutions than anyone in DC. Its always just kick it down the road a couple more years, past the next election.

I don't know where it ends. Total bankruptcy? The EU won't bail us out, they're broke. China might help a bit, to keep their biggest buyer buying. Eventual meltdown and revolution? Seriously, WHO is going to make these difficult decisions? Nobody. It will just run its course, I suppose.

Raise taxes too much and we'll stop paying and choke it off.

--------

[Guest Lester Weevils]

And where does the government get money to pay for the baby boomers SS?

If I'm getting 15% of my pay to invest as I see fit, what other taxes am I paying to let baby boomers to play golf in Florida on my dime for the next 20 years? And what happens to the pile of money I've already paid into the system for the last 20 years? Just considered it a gift to the government?

Hi JayC

When you are as young as 35 does Social Security send you an annual statement with estimated retirement payments? Maybe they only do that for people over a certain age, dunno.

I've been receiving annual statements for awhile. Been self-employed most of life and sending in that whole 15 percent thang. Ain't a high roller, but been sending em what seems to me to be a lot of money.

My SS statement doesn't promise a monthly payment big enough to play golf in florida. If I was to just live on my promised govt check then I would be eating dog food in my paid-off house which will gradually deteriorate over the years because there will be no money for repairs and it will be a stretch just to pay the annual property tax.

The folks who retire to play golf in florida have likely saved enough money that they could retire to florida even if the ss checks quit coming. Florida doesn't sound that great anyway.

I agree with Mike Gideon. I'll take a cash payout of what I've paid in. But I want at least the annual prevailing interest over each year. Alternately I want at least inflation-adjusted dollars, because they've kept my money for so long on an interest-free involuntary loan.

For instance, using this bls inflation calculator--

Inflation Calculator: Bureau of Labor Statistics

The $407 paid in 1970 ought to pay back AT LEAST $2310 in 2011. The $1516 paid in 1980 ought to pay back $4051 today.

I don't make much money but for curiosity cranked all my SS payments thru the inflation calculator and calced the sum. My cash payout ought to be at least a quarter million inflation-adjusted dollars.

That is just an inflation-adjusted payout. If the sums had been invested in a scheme that beats inflation, am guessing closer to a million bucks. It would be more work to accurately guestimate the payout based on yearly prevailing interest rates. Maybe some day I will take a double-dose of blood pressure pills and then calculate that out.

According to what SS estimated payments (including extra annual payments I would make until retirement)--

If I retire at the minimum 62 I'll have to live to age 79 to get my money back.

If I retire at the standard 66 I'll have to live to age 80 to get my money back.

If I retire at age 70 I'll have to live to age 81 to get my money back.

So I have to survive until about age 80 to get my money back regardless of when I retire. The only real advantage of waiting until age 66 or 70 is that I MIGHT get a big enough monthly check to eat a slightly better quality of dog food. Assuming inflation doesn't go nuts and assuming that the govt pays what it promises. Both of which are dubious assumptions.

====

Except for printing lots of money and inflating the way out of the debt, the best option to settle accounts with us baby boomers is to sell off govt property. Same thing that happens in any other bankruptcy.

For instance, I might be willing to accept, in lieu of $250,000 cash, the equivalent value in Federal land, including mineral rights on the land. Or perhaps a share of a big Federal building which would pay me rent every month. Maybe a piece of the Chatt TVA building. Or a dividend-paying piece of Sequoyah Nuclear Plant or one of the TVA hydro dams.

There is some pretty nice Federal land in the Chattanooga area I might accept, though it might make more sense to get a piece of western land with exploitable oil or minerals.

Federal bankruptcy and parting out Federal assets would keep the younger generations from having to pay our burden. They would be free and clear of it unless they vote in their own new mess of expensive horrible ideas.

[mikegideon]

Lester for president!

[G27]

SS is a ponzi scheme.

I've paid a lot into it over the years but would gladly forgo ever receiving a penny if the government got out of the unconstitutional retirement business they're in.

[mikegideon]

SS is a ponzi scheme.

I've paid a lot into it over the years but would gladly forgo ever receiving a penny if the government got out of the unconstitutional retirement business they're in.

They can get out any time, but they need to settle their contract with me. They sure as hell come after me if I'm $2 short on what I "owe" them. The fact that they have mismanaged their way into a pickle doesn't let them off the hook.

[RobertNashville]

The problem with that math is, the "younger" generation, many of whom have been already paying into the system for 20+ years, get to pay 30+% of their income in taxes for the next 30-40 years of their lives, to only get to keep 7-10% for their 'government' required 401k. So, the older generations who are responsible for this mess get their retirement income, the 'younger' generation gets to pay into a super expensive "retirement" package mandated by the government where most of our money goes to pay for people to play golf for the next 20-30 years in Florida, while we retire with pennies on the dollar, and are left to our own devices in our old age?

I'm sorry but there must be some shared responsibility for this mess... People who have been paying into the ponzi scheme should get something back, but not at the expense of the next generation having to pay 50-55% taxes and getting virtually no retirement out of the deal.

The solution can not be that people who are 40 years or younger are forced to pay for the baby boomers retirement, and get nothing in return... the baby boomers are going to have to take a hair cut too.

I don't believe I offered any "math" in my prior statement; working or otherwise. Moreover, I didn't offer specific details, mathematical or otherwise...there will have to be a phase out of the current SS system and a phase in of something to replace it...everyone...EVERYONE...will have to "give some" but no one should be required to "give all".

I think we need to keep in mind that SS isn't just a matter of "government promises" being made - the government has taken nearly around/near 15% of my pay for decades, depriving me and those like me with the opportunity to have saved that money for ourselves. I'm not saying that as an excuse for not saving at all but I could have easily been a millionaire with just what SS has taken form me had I never saved another penny on my own. For the government to now, effectively say, "screw you baby-boomers" is pretty abhorrent. People at or near retirement age aren't just "owed" their benefits because of the promises made...they need them because what they've paid in wasn't available for them to save for themselves.

Edited March 3, 2011 by RobertNashville

[Oh Shoot]

They can get out any time, but they need to settle their contract with me. They sure as hell come after me if I'm $2 short on what I "owe" them. The fact that they have mismanaged their way into a pickle doesn't let them off the hook.

Yup, I just got my 6th SSI payment, myself.

Worked since I was kid, summers, through most of college, was out of work maybe total of 2 years in whole adult life. Hung it up at 59, with SSI at 62 being counted on as part of the decision.

The gummit is gonna have to wean folks off the teat. Pay back with interest up to a certain age, nuke it entirely for those too young to have worked at all, whatever. It's been an incremental problem and will require incremental solution.

- OS

[mikegideon]

I don't view it as a teat when they extracted the money from my check, and promised something in return. It ain't welfare.

[G27]

I don't view it as a teat when they extracted the money from my check, and promised something in return. It ain't welfare.

Well, sorta.

Depending on how you live, you may well draw more than you paid in.

[mikegideon]

Well, sorta.

Depending on how you live, you may well draw more than you paid in.

I know some of them.

[Guest Lester Weevils]

Well, sorta.

Depending on how you live, you may well draw more than you paid in.

If you don't live to retirement age, you don't get a penny. And unless you have minor children, the govt just gets to keep your money. It is an involuntary life-span lottery system (with pitiful payout even for the "winners").

It is analogous to some actuarial-based insurance company annuity plans. You pay a lump sum of seed money, and the company promises to pay you X dollars per year for life. Some people die early and the insurance company takes a profit. Some people live "too long" and the insurance company takes a loss. If the actuaries are competent enough to earn their salary, then the insurance company expects to make a profit over the entire annuity pool.

The SS system is in some ways actuarially based. For instance my example that I have to live to about 80 to get all my money back, regardless whether I retire at age 62 or 70. That is an actuarial calculation. The numbers would not be so tidy and consistent if it were an accidental coincidence.

The problem is that the "annuity payments" to social security have been squandered on Viet Nam Huey Choppers and Reagan-era MX missiles and the failed War On Poverty and all sorts of other frivolous purchases, and the only "investment" we have left are SS govt bonds. The system will remain solvent on paper for a long time, however the only way to redeem the bonds is to raise tax on our children and grand-children.

Edited March 3, 2011 by Lester Weevils

[Guest Lester Weevils]

Addendum: The CDC says the average USA life expectancy is 77.9 years, so if everybody must live to 80 to get their money back, then Social Security is guaranteed to make a long-term profit. Unfortunately the profit is in worthless govt bonds.

[Oh Shoot]

I don't view it as a teat when they extracted the money from my check, and promised something in return. It ain't welfare.

Yeah, "teat" wasn't valid analogy, 'cept perhaps for disability cheaters.

Of course you're right; and we are perfectly guiltless, since we had no choice about "contributing".

- OS

[JPR1959]

The best thing to do with Social Security is to put a limit on your ability to draw according to your net worth. For example, if you're a millionaire over 65 you shouldn't be able to draw from Social Security. It's not fair, but it's a possible solution. It will not "fix" the system, but it would help tremendously.

Defense spending should NOT be cut. There is major trouble brewing in the world. Look at the Muslim countries rising up for "democracy". Where did all of the Muslims get AKs while living under a dictator? China is continually building weapons and even the Russians are starting to get into the act. With all of our economic problems brewing, we MUST be able to defend ourselves.

I would encourage everyone to read Broke by Glenn Beck. These problems in our country have been going on for 100 years. Every politician is guilty of raping us.

[mikegideon]

The best thing to do with Social Security is to put a limit on your ability to draw according to your net worth. For example, if you're a millionaire over 65 you shouldn't be able to draw from Social Security. It's not fair, but it's a possible solution. It will not "fix" the system, but it would help tremendously.

Defense spending should NOT be cut. There is major trouble brewing in the world. Look at the Muslim countries rising up for "democracy". Where did all of the Muslims get AKs while living under a dictator? China is continually building weapons and even the Russians are starting to get into the act. With all of our economic problems brewing, we MUST be able to defend ourselves.

I would encourage everyone to read Broke by Glenn Beck. These problems in our country have been going on for 100 years. Every politician is guilty of raping us.

It's amazing how much trouble those Muslims give us on probably less than 1% of our budget. Of course, they don't have travel costs. I'm all about cutting waste out of defense spending. Any cuts will effect the economy though.

[G27]

The best thing to do with Social Security is to put a limit on your ability to draw according to your net worth. For example, if you're a millionaire over 65 you shouldn't be able to draw from Social Security. It's not fair, but it's a possible solution. It will not "fix" the system, but it would help tremendously.

How very marxist of you.

[mav]

How very marxist of you.

Come on now. You have got to get with the program. From each according to his ability, to each according to his need.

[RobertNashville]

Well, sorta.

Depending on how you live, you may well draw more than you paid in.

Getting back more than you put is should be the norm, not the exception. IMAHO

Of course I'm saying that based on what SS was supposed to be rather than what it is...politics and hype aside, it was essentially be a mandatory savings account and even a lowly savings account should give some return on your money.

[JPR1959]

How very marxist of you.

This was actually an idea being tossed out by Indiana governor Mitch Daniels. If you can think of any ways to fix the system, please feel free to speak up.

[JPR1959]

It's amazing how much trouble those Muslims give us on probably less than 1% of our budget. Of course, they don't have travel costs. I'm all about cutting waste out of defense spending. Any cuts will effect the economy though.

Gas prices have gone up over 50 cents a gallon since Mubarak was forced from power. How are you going to feel when gasoline rises to $4+ per gallon? The environmental movement has stopped all domestic exploration and production. There hasn't been a new refinery built in the US for over 20 years. You fail to see a problem???

[RobertNashville]

The best thing to do with Social Security is to put a limit on your ability to draw according to your net worth. For example, if you're a millionaire over 65 you shouldn't be able to draw from Social Security. It's not fair, but it's a possible solution. It will not "fix" the system, but it would help tremendously.

Defense spending should NOT be cut. There is major trouble brewing in the world. Look at the Muslim countries rising up for "democracy". Where did all of the Muslims get AKs while living under a dictator? China is continually building weapons and even the Russians are starting to get into the act. With all of our economic problems brewing, we MUST be able to defend ourselves.

I would encourage everyone to read Broke by Glenn Beck. These problems in our country have been going on for 100 years. Every politician is guilty of raping us.

BROKE by Glenn Beck is an excellent book to read.

Defense spending can't be off the table; not when we have an annual deficit of WELL over a trillion dollars (although we do need to be careful about what gets cut).

I can't disagree more with your comment concerning SS. Limiting SS to "need" encourages people to do exactly the opposite of what we should want people to do...those who have not spent every penny they've earned and built a decent net worth should not be punished with lower SS that someone who has set around on the ass all their life and/or spent every penny they've ever earned.

[mikegideon]

Gas prices have gone up over 50 cents a gallon since Mubarak was forced from power. How are you going to feel when gasoline rises to $4+ per gallon? The environmental movement has stopped all domestic exploration and production. There hasn't been a new refinery built in the US for over 20 years. You fail to see a problem???

Yeah, I see a problem. What does that have to do with waste?