I agree with the means testing. It really frosts me off that I am paying social security taxes to benefit people who are far more affluent than I. I mean, ok, set the bar high if you want, but people with an income of a million a year and assts in the billions are entitled to social security and that's just wrong at a time when you are cutting Medicaid.
Good point about the effect of a saving program. Of course you could counteract this with a government spending program. On Wed, 19 Jan 2005 04:29:29 -0400, Robert Munn <[EMAIL PROTECTED]> wrote: > Boy, I'm sorry I missed out on this discussion earlier! Too many things going > on... > > I agree with Gruss on the broad points here. American do not save. We need to > save more. And $100K by age 30 may seem like a lot to you (and me), but bring > an aspiring professional from a poor country to the U.S. at age 21, give them > a decent job, and I guarantee you they will blow that $100K number out of the > water by age 30. It's all about attitude. Read "The Millionaire Next Door" or > watch Suze Orman (not a fan myself, but she knows what she is talking about). > It's all about cutting expenses. > > Having said that, if everyone did that and got to where we need to be, a 10% > savings rate instead of a 1% savings rate, the U.S. economy would take a > beating. Consumer spending is 2/3 of our economy, so chop 10% off consumer > spending and that's nearly a 7% drop in the economy. Can you spell recession? > Still, we need to save more, individually and as a nation. > > On the question of Social Security policy, it was originally intended to help > the extremely elderly who had lived beyond average life expectancy It has > morphed into an entitlement bonanza- the promise the if you make it to a > certain age (not all that old in fact) you don't have to work any longer. > > I don't think the whole story has been told as to what will make up "private > accounts", but your skepticism is well warranted. Alan Greenspan is himself > a skeptic of private accounts. > > My understanding is that private accounts would be restricted to a very > small group of investment vehicles- Treasury Bonds, for instance, and > perhaps some sort of index funds that track the overall NASDAQ or NYSE > markets. The main point is that you would not be able to invest your private > account into individual stocks, or even in general mutual funds. By tracking > either the dollar (via T-Bills) or the overall U.S. markets, private > accounts would be tracking the wealth of the nation. I think that is > basically the intent of the program. Rather than leave all of that > money stuck in a non-existent "Social Security lockbox", the government > would allow you to invest a portion of it- a portion only- in some sort of > private investment vehicle. > > If private accounts are well thought out, they could be part (but not all) > of the solution for fixing Social Security for us, our children, and their > children. Let's be clear about this- Social Security, without any changes, > will be totally bankrupt within 40 years. It could be even sooner. I think > current projections are being made based on current life expectancy, but I > think life expectancy may be ten yeas higher than it is today within the > next 40 years. What would that mean? Today, the average life expectancy is > 77 years in the U.S. If that number were raised to 87 years, Social Security > would have to almost double the number of years of benefits paid to seniors. > Coupled with the declining birth rate, that spells financial disaster for > future generations. > > IMHO, a future-proof remedy requires several things: > > - private accounts > > - indexing the age for full benefits to the average life expectancy. When > Social Security was first started 60 odd years ago, the average life > expectancy was 65, and that was when full benefits kicked in. But > politicians know a sacred cow when they see one, and that's what they saw in > Social Security. The age for full benefits will rise to 68 soon, but that > means it is already lagging 9 years behind life expectancy. > > - indexing the increase in benefits to costs, not wages. > > - means testing as a last resort. Someone needs to come up with a failsafe > that makes sure the poorest, most desperate people are paid out of the fund > first, and everyone else gets what is left. > > > >On Tue, 18 Jan 2005 19:38:11 -0600, Gruss Gott <[EMAIL PROTECTED]> wrote: > > > >> I realize the mistake I made here: per married couple, 100K by 30ish > >> (less than 35). > > > >I still don't buy it. Not for the majority of people. > > > >Median household income in the U.S. is only $45k. Population between > >age 25-35 is roughly 40mil. Population aged 35-70 is 118mil. My guess > >is that people under 35 make less than people over 35. So if the > >median household income is $45k, ages 35 and under are probably > >significantly on the lower side of that. I know that was the case for > >me. > > > >Don't get me wrong. Saving is great and more people should do it. This > >whole discussion is reminding me that I need to up my retirement > >contributions. I just know that I'm lucky to have something to save. > > > >As for Social Security, I don't know much about it and I'm not > >trusting it for my future, but from what I can tell an infusion of > >private investments are primarily going to make a few rich people > >richer. They will ride the first wave then shuffle the new money away > >from the suddenly artificially inflated stocks that will probably > >collapse as they correct themselves. So the average person still gets > >screwed either way. My opinion: my money is going out anyway so better > >for my money to go to the underprivledged than to the exceedingly > >rich. But hey, whatever. > > > >-Kevin > > ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~| Find out how CFTicket can increase your company's customer support efficiency by 100% http://www.houseoffusion.com/banners/view.cfm?bannerid=49 Message: http://www.houseoffusion.com/lists.cfm/link=i:5:143410 Archives: http://www.houseoffusion.com/cf_lists/threads.cfm/5 Subscription: http://www.houseoffusion.com/lists.cfm/link=s:5 Unsubscribe: http://www.houseoffusion.com/cf_lists/unsubscribe.cfm?user=11502.10531.5 Donations & Support: http://www.houseoffusion.com/tiny.cfm/54
