----- Original Message ----- From: "Gary Denton" <[EMAIL PROTECTED]> To: "Killer Bs Discussion" <brin-l@mccmedia.com> Sent: Friday, February 18, 2005 4:22 PM Subject: Re: Social Security Facts:
> > Now, would I support lower maximum benefits for Social Security?. I > agree in principle, probably not in practice. I also agree that > children should be receiving the same kind of program that Social > Security has provided for the elderly. They don't because it is a > program administered like what you propose to do for Social Security - > benefits only to a certain underclass of people. That's not necessarily true. There is just an upper limit on the benefits. Even well off people in their 50s are going to look at SS as something worth keeping, because, [EMAIL PROTECTED] it anyways, they have been paying for years and need to get something back. But, I take your point. Perhaps my suggestion is too progressive to work, and the rise in benefits will have to be slowed with a slighly different mix that improves the progressive nature of SS more slowly. >In Texas, where we > have the full manifestation of Bush's GOP philosophy, we have the > highest number and the highest percentage of children without health > insurance and the state refuses to fully fund child health care > programs despite most of the cost being picked up by the federal > government. First, I think Perry makes GWB look like Michael Moore....so I think that Bush was a liberal Republcan by Texas standards. It's interesting that Kay Baily Hutchenson is making noises about running for governor as a more liberal alternative to Perry. Second, I can't see any benefits to the middle class from this program. > So there is a big but here, *But* I am concerned that Social > Security has been successful because it had support from all classes > except the very rich and was not seen as a welfare program. If you > limit it in the way you describe over time there will be more and more > support to cut it like all other benefit programs restricted to low > incomes have been cut. Maybe I wasn't clear. The asymtotic limit of my proposal is that people of all income get the same benefit. As it stands now, the more you earn, up to the tax limit, the more you receive in SS. > I am also concerned that you may be misguided as to what a healthy > economic society can afford in social benefit programs. I'm more thinking about how our social benefits programs are now tilted heavily in the favor of old people, and away from children. > There is a big step necessary to fix Social Security permanently, > provide a funding mechanism that changes with demographics. That > funding mechanism would be funding from an estate tax. Can you think > of another one? Actually, the estate tax only reflects, in a delayed fashion,** the year density of the population(% of population per year), not the total population of retirement age. The long term problem with SS funding is not the shape of the population pyramid, but the expected life span of Americans. A program (starting at age 67) that pays people who's life expectancy at 67 is 15 years costs 50% more (roughly) than one that pays people who's life expectancy at 67 is 10 years. The estate tax does not address this problem....we only die once. :-) > A less important and not permanently viable solution might be trust > funds that are invested in higher rate of return investments. That > would be the Clinton solution where as bonds in the trust fund mature > they are replaced with common stocks and bond investments. But, that's a wash, because T-bills are part of the general investment climate. Schemes that involve borrowing money to make money in investments rarely work in a marketplace. > The SSA has recently released a paper that shows if the wage cap on > the income subjected to FICA was erased Social Security meets their 75 > year viability test. It meets a longer viability test if benefits are > not increased for the income over $90,000. Is that an acceptable > solution to you? I thought about this a bit, and it depends on what you mean by the last line. If 90k is just inflation adjusted, and not wage adjusted, then that is more than fine. If it is wage adjusted, it only puts the problem of longer life spans off for a while, while increasing the fraction of GDP that is given to the elderly. Dan M. ** If on average, people retired at age X and died at age Y, then the delay would be, roughly, (Y-X)/2. _______________________________________________ http://www.mccmedia.com/mailman/listinfo/brin-l
