On Sat, Nov 20, 2010 at 2:40 PM, Robert Munn <cfmuns...@gmail.com> wrote: > > Tweaks do nothing but delay the inevitable. I like the Iroquois notion of > considering the effects of our actions on the next seven generations. In > seven generations, Social Security will have failed because it was > unsustainable. So you can be proud that we are pushing poverty off onto a > later generation, just don't pretend that it's not happening.
Do you have anything even vaugely resembling facts to back this up? All I've heard is bluster. I've shown, again and again, a variety of proposals that will extend the Social Security program, as designed, out past the next 75 years. Personally, I think that trying to forecast 75 years out is a bit of black magic. If you want to bitch that we can't forecast for 7 generations, well, that's your right I suppose but it's really stupid. Here's a little simple demographic math for you: The reason why there was formerly a larger number of people paying in for each retiree was that there was the "baby boom". We had an abnormally large cohort post-WWII. Now we are running into a situation where that particular cohort is getting to retirement age. The generations behind them aren't of the same size, they are closer to the size we saw prior to the baby boom. Hence, fewer people paying into the fund because fewer people in the workforce. In the next decade, payouts will start to outpace inputs (the fund is still currently running a $1 billion a year surplus if I recall). The worst ratio of payouts to input will then hit around the 2030s as the maximum number of boomers are in retirement. In order to meet obligations in 2034, if no changes are made to the program, the general fund would have to subsidize a couple percent of the trust fund if we are to keep payouts at the rate they currently are. There after, the disparity starts to level off and come back into balance because the big bulge of the baby boom cohort dies off and the subsequent generations are of much similar sizes to one another. Now, as to Social Security vs Medicare, lets look at some even more simple math: For Social Security, if you have generations of similar sizes, the math is pretty easy. When wage growth outpaces inflation, you have a net increase in the amount going in versus coming out. If inflation outpaces wage growth, the opposite is true. If employment outpaces historical levels, you have a net increase versus coming out. If it is below historical levels, the opposite is true. So the three major factors determining the health of the system are: population variation in generations, long term wage growth vs inflation and long term unemployment rates. Over the history of the Social Security program, we've done relatively well in the wage growth vs inflation and long term stability of employment rates. The big gnarly bit was, of course, an abnormally large generation. Generation size seems to have stabilized. If we look at historical trends, we should be able to settle back down into a relatively stable pattern regarding input and output for the Social Security Trust Fund, as we did prior to the Baby Boom. Things may, of course, change, which is why I wonder if we're going to be stuck at a different "natural rate" of unemployment. Then you have Medicare. Medicare suffers from the same pros and cons on the input side as Social Security does. The more workers you have, the higher wages, the more goes in. The more people drop out of the work force, the more people that retire and start utilizing the program, the less money it has going into it. The huge enormous difference, however, is on the output side. Social Security output variation is largely driven by inflation. Inflation was wandered up and down during different time periods, but has rarely exceeded 10% for even a couple years. Health care, on the other hand, routinely sees cost increases of more than 10% every single year, year after year after year. The difference in cost outputs between Medicare and Social Security is literally exponential. Social Security will have some problems in about 15 to 20 years. We'll have some decisions to make on how to handle it and I agree that we should make them sooner rather than later. Then the biggest contributor to the problem (an abnormally large cohort) will go away and the problems will decrease even without action. I'd rather see us take action though and deal with it proactively. Medicare, though, is a problem here and now. And its getting worse, faster, than any other program. And we don't have a good set of ideas on what to do to fix it. Social Security is a red herring. >> >> Medicare presents by far the largest >> contribution by huge amounts. That's one of the reasons that Obama and >> Democrats pledged to try for healthcare reform. >> > > They pushed Obamacare because they thought it was their one chance to get it > through. Remember Rahm 'never let a crisis go to waste' Emmanuel? So they > threw some sh!t against the wall to see what would stick. That's how we > ended up with bureaucracy run amok like the 10-99 reporting law. Great job > in creating job killing regulations in the middle of a recession, Democrats! Can't say I'm a huge fan of the law, no. I think you don't give it credit where it is due, but yeah, plenty to criticize about it. The best thing I get out of it is that they did something. That is more than anyone else has been able to before. Legislation thrives on momentum. Now, if we can move forward, fix the parts that don't work, improve the parts that do and continue to try and achieve genuine health care reform, perhaps we can do something about one of our most serious problems. Judah ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~| Order the Adobe Coldfusion Anthology now! http://www.amazon.com/Adobe-Coldfusion-Anthology/dp/1430272155/?tag=houseoffusion Archive: http://www.houseoffusion.com/groups/cf-community/message.cfm/messageid:332044 Subscription: http://www.houseoffusion.com/groups/cf-community/subscribe.cfm Unsubscribe: http://www.houseoffusion.com/groups/cf-community/unsubscribe.cfm
