Discussion:
Conscripts in The Social Security Ponzi Scheme
(too old to reply)
Tom Jigme Wheat
2011-06-14 05:04:48 UTC
Permalink
social security has not contributed one dollar to the national
deficit. currently it has 2.5 trillion dollar surplus. However, when
the Baby boomers start to retire in the next 10 years, social security
will start taking in more than what it collects in payroll taxes. This
also largely due to the Bush tax cuts, and collapse of the economy, as
well as various presidential administrations spending portions of the
social security surplus like when clinton diverted 15 billion dollars
from the trust fund to partially fund the Kosovo NATO aerial bombing
in 1997 or 1999? The fund will only be able to pay 75 percent of
benefits starting in 2036. Social Security Disability Insurance will
be only able to pay partial benefits in 2018. Medicare Part A will be
broke by 2024.

The problem with privatization of social security is that it puts the
most vulnerable, the elderly and disabled at the mercy of the
unregulated Wall Street derivatives market. After the 2008 economic
collapse of the housing market, I think few people would be willing to
gamble their retirement money in a unpredictable stock market.
Regarding the Chilean Social Security model, they have like 2 year
waiting lists to see doctors, and they have rationed care, only
certain target population health conditions are covered, under their
entitlement programs.

One way to increase funding for social security is for Obama to not
extend his payroll tax holiday next year. Currently it is costing
social security about 140 billion dollars in revenues annually, since
payroll tax rates were dropped from 6.2 percent to 4.2 percent.
Secondly the governmennt should raise the cap on taxable income
subject to the social security payroll tax. Currently, wages above
106000 dollars a year is not taxed. Finally we must repeal the Bush
tax cuts. The Congressional Budget Office predicts that they will add
2.5 trillion to the national debt by 2020.
thomaswheat1975
http://spectator.org/archives/2011/06/13/conscripts-in-a-ponzi-scheme
        "One thing is clear: in order to "fix" Social Security, we will
        pay more and retire later."
By Daniel Oliver on 6.13.11
The spit turns slowly over the Social Security roasting fire but there is
no whimpering from the children being cooked. Yet.
Jonathan Swift's Modest Proposal (one of English literature's great
satires) for preventing the children of poor people in Ireland from being
a burden to their parents or their country, and for making them
beneficial to the public was: to eat them.
Our problem is almost precisely the reverse. We have too much food, as
Mrs. Obama reminds us, and we have too few children: too few to guard the
gates of Western civilization, too few to pay the bills coming due for
the welfare state, primarily for Social Security and Medicare.
What to do? Two facts deserve our preliminary attention.
One. In the 2004 presidential election (a more typical election than the
2008 election) only 17 percent of the 18 to 29 year olds voted, meaning
83 percent didn't bother to vote. That's called potential.
Two: The youngest voters haven't, recently, seemed to care much about
even issues that directly affect them. When was the last time you heard
about a student movement? Why is it, for example, that young people don't
lobby and vote to make the drinking age 18, which it was in many places
until 1984? Perhaps buying alcohol with a fake ID out the back door
stimulates sophistication, but it tends to stultify the exercise of civic
responsibility.
Grownups may think that presidential elections are about important
issues, but it's not obvious that the kids care about policies at all.
Oh, yes, they get caught up in the hoopla of a presidential campaign. But
do they think that the policies a president will pursue will actually
affect them?
If young people really cared about public policy, they would be frantic
about the financial state of the country. Debts are piling up higher than
the Washington Monument and they are being set up to pay them off. Yet
not a single college student -- that we know of -- has let out a whimper.
But can the older folks count on the continuing civic lassitude of the
young? We don't know. But we do know that the current fiscally absurd
Social Security scheme might not survive the kids' discovery of
democracy's power. The fact is, the kids in America are being had, even
as the poor citizens of the Arab states, whom we have been watching on
television in recent months, have for so many years, decades even, been
had.
One thing is clear: in order to "fix" Social Security, we will have to
recruit the young and assign to them the following tasks: pay more and
retire later. But what's in that fix for them?
Not a lot. At least, not a lot compared to the alternative, a privatized
Social Security system.
Both skeptics and Progressives (aka liberals) will vehemently oppose
privatization of Social Security, the skeptics because they fear it won't
work, the Progressives because they fear it will.
But of course it will work. It is working, in Chile. Workers there have
been getting rich on their social security accounts since 1981.
Why don't we privatize our Social Security system? Because if today's
young people were released from the bondage of Social Security, who would
pay into the system the funds necessary to provide the benefits promised
to today's retirees? As everyone is finally discovering, Social Security
is not a lock box. The money flows out in benefits as fast as --
actually, starting last year, faster than -- it is paid in in taxes.
Legislators call that a pay-as-you-go scheme.
Prosecutors call it a Ponzi scheme. The young are like Bernie Madoff's
clients. Or like pigeons, a term given to investors duped into supporting
a theatrical enterprise that the insiders have come to realize will flop
financially. Like, say, Springtime for Obama in Balanced Budget Land.
The dirty big secret of Social Security reform is that it depends on
keeping the young as conscripts in a Ponzi scheme. Where's the morality
in that -- in an enlightened Western democracy?
The answer to that question may be that the government promised -- well,
sort of: see the story of Ephram Nestor here -- the older folks (whom
Time magazine in 1988 dubbed the "Greedy Geezers") that they would
receive Social Security benefits when they retired, and it would be
immoral not to honor that promise.
But that is a moral claim that may have to give way to a new democratic
imperative in the coming years if the young decide that being roasted on
the Social Security spit like pigeons no longer appeals.
Jerry Okamura
2011-06-14 17:37:43 UTC
Permalink
What do the trustees of the system say about the system?

"Tom Jigme Wheat" wrote in message news:dacb5951-9b70-4929-872c-***@s16g2000prf.googlegroups.com...

social security has not contributed one dollar to the national
deficit. currently it has 2.5 trillion dollar surplus. However, when
the Baby boomers start to retire in the next 10 years, social security
will start taking in more than what it collects in payroll taxes. This
also largely due to the Bush tax cuts, and collapse of the economy, as
well as various presidential administrations spending portions of the
social security surplus like when clinton diverted 15 billion dollars
from the trust fund to partially fund the Kosovo NATO aerial bombing
in 1997 or 1999? The fund will only be able to pay 75 percent of
benefits starting in 2036. Social Security Disability Insurance will
be only able to pay partial benefits in 2018. Medicare Part A will be
broke by 2024.

The problem with privatization of social security is that it puts the
most vulnerable, the elderly and disabled at the mercy of the
unregulated Wall Street derivatives market. After the 2008 economic
collapse of the housing market, I think few people would be willing to
gamble their retirement money in a unpredictable stock market.
Regarding the Chilean Social Security model, they have like 2 year
waiting lists to see doctors, and they have rationed care, only
certain target population health conditions are covered, under their
entitlement programs.

One way to increase funding for social security is for Obama to not
extend his payroll tax holiday next year. Currently it is costing
social security about 140 billion dollars in revenues annually, since
payroll tax rates were dropped from 6.2 percent to 4.2 percent.
Secondly the governmennt should raise the cap on taxable income
subject to the social security payroll tax. Currently, wages above
106000 dollars a year is not taxed. Finally we must repeal the Bush
tax cuts. The Congressional Budget Office predicts that they will add
2.5 trillion to the national debt by 2020.
thomaswheat1975
http://spectator.org/archives/2011/06/13/conscripts-in-a-ponzi-scheme
"One thing is clear: in order to "fix" Social Security, we will
pay more and retire later."
By Daniel Oliver on 6.13.11
The spit turns slowly over the Social Security roasting fire but there is
no whimpering from the children being cooked. Yet.
Jonathan Swift's Modest Proposal (one of English literature's great
satires) for preventing the children of poor people in Ireland from being
a burden to their parents or their country, and for making them
beneficial to the public was: to eat them.
Our problem is almost precisely the reverse. We have too much food, as
Mrs. Obama reminds us, and we have too few children: too few to guard the
gates of Western civilization, too few to pay the bills coming due for
the welfare state, primarily for Social Security and Medicare.
What to do? Two facts deserve our preliminary attention.
One. In the 2004 presidential election (a more typical election than the
2008 election) only 17 percent of the 18 to 29 year olds voted, meaning
83 percent didn't bother to vote. That's called potential.
Two: The youngest voters haven't, recently, seemed to care much about
even issues that directly affect them. When was the last time you heard
about a student movement? Why is it, for example, that young people don't
lobby and vote to make the drinking age 18, which it was in many places
until 1984? Perhaps buying alcohol with a fake ID out the back door
stimulates sophistication, but it tends to stultify the exercise of civic
responsibility.
Grownups may think that presidential elections are about important
issues, but it's not obvious that the kids care about policies at all.
Oh, yes, they get caught up in the hoopla of a presidential campaign. But
do they think that the policies a president will pursue will actually
affect them?
If young people really cared about public policy, they would be frantic
about the financial state of the country. Debts are piling up higher than
the Washington Monument and they are being set up to pay them off. Yet
not a single college student -- that we know of -- has let out a whimper.
But can the older folks count on the continuing civic lassitude of the
young? We don't know. But we do know that the current fiscally absurd
Social Security scheme might not survive the kids' discovery of
democracy's power. The fact is, the kids in America are being had, even
as the poor citizens of the Arab states, whom we have been watching on
television in recent months, have for so many years, decades even, been
had.
One thing is clear: in order to "fix" Social Security, we will have to
recruit the young and assign to them the following tasks: pay more and
retire later. But what's in that fix for them?
Not a lot. At least, not a lot compared to the alternative, a privatized
Social Security system.
Both skeptics and Progressives (aka liberals) will vehemently oppose
privatization of Social Security, the skeptics because they fear it won't
work, the Progressives because they fear it will.
But of course it will work. It is working, in Chile. Workers there have
been getting rich on their social security accounts since 1981.
Why don't we privatize our Social Security system? Because if today's
young people were released from the bondage of Social Security, who would
pay into the system the funds necessary to provide the benefits promised
to today's retirees? As everyone is finally discovering, Social Security
is not a lock box. The money flows out in benefits as fast as --
actually, starting last year, faster than -- it is paid in in taxes.
Legislators call that a pay-as-you-go scheme.
Prosecutors call it a Ponzi scheme. The young are like Bernie Madoff's
clients. Or like pigeons, a term given to investors duped into supporting
a theatrical enterprise that the insiders have come to realize will flop
financially. Like, say, Springtime for Obama in Balanced Budget Land.
The dirty big secret of Social Security reform is that it depends on
keeping the young as conscripts in a Ponzi scheme. Where's the morality
in that -- in an enlightened Western democracy?
The answer to that question may be that the government promised -- well,
sort of: see the story of Ephram Nestor here -- the older folks (whom
Time magazine in 1988 dubbed the "Greedy Geezers") that they would
receive Social Security benefits when they retired, and it would be
immoral not to honor that promise.
But that is a moral claim that may have to give way to a new democratic
imperative in the coming years if the young decide that being roasted on
the Social Security spit like pigeons no longer appeals.
Jerry Okamura
2011-06-15 18:36:39 UTC
Permalink
When has the trustees said that Social Security can keep all the promises it
had made? How long have they been saying the same thing?

"Tom Jigme Wheat" wrote in message news:dacb5951-9b70-4929-872c-***@s16g2000prf.googlegroups.com...

social security has not contributed one dollar to the national
deficit. currently it has 2.5 trillion dollar surplus. However, when
the Baby boomers start to retire in the next 10 years, social security
will start taking in more than what it collects in payroll taxes. This
also largely due to the Bush tax cuts, and collapse of the economy, as
well as various presidential administrations spending portions of the
social security surplus like when clinton diverted 15 billion dollars
from the trust fund to partially fund the Kosovo NATO aerial bombing
in 1997 or 1999? The fund will only be able to pay 75 percent of
benefits starting in 2036. Social Security Disability Insurance will
be only able to pay partial benefits in 2018. Medicare Part A will be
broke by 2024.

The problem with privatization of social security is that it puts the
most vulnerable, the elderly and disabled at the mercy of the
unregulated Wall Street derivatives market. After the 2008 economic
collapse of the housing market, I think few people would be willing to
gamble their retirement money in a unpredictable stock market.
Regarding the Chilean Social Security model, they have like 2 year
waiting lists to see doctors, and they have rationed care, only
certain target population health conditions are covered, under their
entitlement programs.

One way to increase funding for social security is for Obama to not
extend his payroll tax holiday next year. Currently it is costing
social security about 140 billion dollars in revenues annually, since
payroll tax rates were dropped from 6.2 percent to 4.2 percent.
Secondly the governmennt should raise the cap on taxable income
subject to the social security payroll tax. Currently, wages above
106000 dollars a year is not taxed. Finally we must repeal the Bush
tax cuts. The Congressional Budget Office predicts that they will add
2.5 trillion to the national debt by 2020.
thomaswheat1975
http://spectator.org/archives/2011/06/13/conscripts-in-a-ponzi-scheme
"One thing is clear: in order to "fix" Social Security, we will
pay more and retire later."
By Daniel Oliver on 6.13.11
The spit turns slowly over the Social Security roasting fire but there is
no whimpering from the children being cooked. Yet.
Jonathan Swift's Modest Proposal (one of English literature's great
satires) for preventing the children of poor people in Ireland from being
a burden to their parents or their country, and for making them
beneficial to the public was: to eat them.
Our problem is almost precisely the reverse. We have too much food, as
Mrs. Obama reminds us, and we have too few children: too few to guard the
gates of Western civilization, too few to pay the bills coming due for
the welfare state, primarily for Social Security and Medicare.
What to do? Two facts deserve our preliminary attention.
One. In the 2004 presidential election (a more typical election than the
2008 election) only 17 percent of the 18 to 29 year olds voted, meaning
83 percent didn't bother to vote. That's called potential.
Two: The youngest voters haven't, recently, seemed to care much about
even issues that directly affect them. When was the last time you heard
about a student movement? Why is it, for example, that young people don't
lobby and vote to make the drinking age 18, which it was in many places
until 1984? Perhaps buying alcohol with a fake ID out the back door
stimulates sophistication, but it tends to stultify the exercise of civic
responsibility.
Grownups may think that presidential elections are about important
issues, but it's not obvious that the kids care about policies at all.
Oh, yes, they get caught up in the hoopla of a presidential campaign. But
do they think that the policies a president will pursue will actually
affect them?
If young people really cared about public policy, they would be frantic
about the financial state of the country. Debts are piling up higher than
the Washington Monument and they are being set up to pay them off. Yet
not a single college student -- that we know of -- has let out a whimper.
But can the older folks count on the continuing civic lassitude of the
young? We don't know. But we do know that the current fiscally absurd
Social Security scheme might not survive the kids' discovery of
democracy's power. The fact is, the kids in America are being had, even
as the poor citizens of the Arab states, whom we have been watching on
television in recent months, have for so many years, decades even, been
had.
One thing is clear: in order to "fix" Social Security, we will have to
recruit the young and assign to them the following tasks: pay more and
retire later. But what's in that fix for them?
Not a lot. At least, not a lot compared to the alternative, a privatized
Social Security system.
Both skeptics and Progressives (aka liberals) will vehemently oppose
privatization of Social Security, the skeptics because they fear it won't
work, the Progressives because they fear it will.
But of course it will work. It is working, in Chile. Workers there have
been getting rich on their social security accounts since 1981.
Why don't we privatize our Social Security system? Because if today's
young people were released from the bondage of Social Security, who would
pay into the system the funds necessary to provide the benefits promised
to today's retirees? As everyone is finally discovering, Social Security
is not a lock box. The money flows out in benefits as fast as --
actually, starting last year, faster than -- it is paid in in taxes.
Legislators call that a pay-as-you-go scheme.
Prosecutors call it a Ponzi scheme. The young are like Bernie Madoff's
clients. Or like pigeons, a term given to investors duped into supporting
a theatrical enterprise that the insiders have come to realize will flop
financially. Like, say, Springtime for Obama in Balanced Budget Land.
The dirty big secret of Social Security reform is that it depends on
keeping the young as conscripts in a Ponzi scheme. Where's the morality
in that -- in an enlightened Western democracy?
The answer to that question may be that the government promised -- well,
sort of: see the story of Ephram Nestor here -- the older folks (whom
Time magazine in 1988 dubbed the "Greedy Geezers") that they would
receive Social Security benefits when they retired, and it would be
immoral not to honor that promise.
But that is a moral claim that may have to give way to a new democratic
imperative in the coming years if the young decide that being roasted on
the Social Security spit like pigeons no longer appeals.
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