Greenspan to Congress: Cut Social Security Benefits

[Wraith]

--"I know that's a staple of libertarian philosphy, but it's also incorrect,"

How is it incorrect? A Ponzi scheme pays out to early participants by taking money from a larger number of later participants. That's exactly what Social Security is trying to do. There is no "trust fund" or saving or anything of the sort, all the money gets spent now. Which means the people paying in now are supporting the people who are getting paid now. Which is a Ponzi scheme, and is only supportable as long as the number of new participants continues to grow.

If you want to make it not be a Ponzi scheme you'll have to scrap the whole system and start over. Which I wouldn't quite call "saving", unless knocking out a window and putting in a door somehow saves the window...

Wraith
"Politics and crime - they're the same thing."
-- ("The Godfather")

[pchang]

Doesn't anyone read my sig? SS is a Ponzi scheme, but Ponzi schemes can work if the number of new payers balances out the number of old payees. Thus, we either need to have more babies or kill of more old people. However, by expanding the scope of the program, the numbers are made worse.

[MichaeltheGreat]

Originally posted by Sava
remove income cap on the amount taxed... currently, the highest amount people are taxed on SS is $87,000 or so... that means... someone making $10,000,000 gets taxed as if they made $87,000.

That is terribly regressive and not fair.

And you're a moron. Not only is the benefit capped in addition to the tax being capped, but if you continue to earn income at any decent amount, your SS benefit is reduced accordingly, regardless of what you contribute.

Oh wait, but it's more important that rich people making hundreds of millions have an extra million dollars rather than millions of people having a decent government retirement.

Actually, it is, since those "millions of people" generally don't have a decent government retirement even at current taxing and spending levels. So **** it, the system doesn't work, let's do something else.

[MichaeltheGreat]

Originally posted by Ben Kenobi


Adam Smith:

What would happen if you lowered the payouts, to what would be needed for a person to live comfortably on their income in their retirement, but no more?

Payouts are already such that most retirees relying solely on SS benefits can't live even minimally comfortably in most areas of the US. Northwestern Mexico is has a lot of US retirees who move down there for lower housing, medical and drug costs, because they can't afford to live in the US.

[chequita guevara]

Originally posted by Wraith
--"I know that's a staple of libertarian philosphy, but it's also incorrect,"

How is it incorrect? A Ponzi scheme pays out to early participants by taking money from a larger number of later participants.

And that's not what social security is. SS is a tax on current workers to keep the elderly from living in poverty. Ponzi schemes also are fraudulent. The nature of the crime must be kept from those who by in or they'll lose faith in the system. With social security, there has been a concerted effort on the part of some to lie about the system in order to make it fail.

[MichaeltheGreat]

Originally posted by chegitz guevara


And that's not what social security is. SS is a tax on current workers to keep the elderly from living in poverty. Ponzi schemes also are fraudulent. The nature of the crime must be kept from those who by in or they'll lose faith in the system. With social security, there has been a concerted effort on the part of some to lie about the system in order to make it fail.

A tax i.e. a compulsory payment under authority of law, rather than the effort involved in convincing people to give up their money voluntarily. Oh, and Ponzi scheme investors can stop investing and at least cut future losses, whereas with a tax, you are mandated to pay.

The manner in which SS has been sold to the taxpayer is fraudulent - my grandparents were all relatively late in their earning years when it was introduced, and you'll still find a huge number of people who have no concept how the system works, but buy into the sacred cow concept of goverment taking care of them in their old age, because you sure can't trust anyone else.

People may lie, but numbers don't. The amount of tax, the benefits, population demographics are all hard numbers, and they all demonstrate one thing: the current system is bound to fail.

[Shogun Gunner]

Originally posted by pchang
I used to enjoy it when during the year it looked like I got a 7% raise when I hit the SS income cap. Medicare has no such cap.

I deeply wished for Medicare to have the same cap. Good point.

That "4Q bonus" helps cover the holiday season expenses.

[Kidlicious]

Greenspan is just hurting the Republicans with these warnings. Bad timing for the conservatives - so close to the election. The way it looks is the Republicans want to cut taxes for the rich and pay for it by taking away the elderlies social security. I bet Alan is getting some pressure on this one to keep it quiet about this for now.

[Ned]

I don't know whether anyone has pointed out that Greenspan said only that action had to be taken, which is a no-brainer.

[Kidlicious]

Originally posted by Ned
I don't know whether anyone has pointed out that Greenspan said only that action had to be taken, which is a no-brainer.

He said that taxes shouldn't be raised.

[chequita guevara]

Originally posted by Ned
I don't know whether anyone has pointed out that Greenspan said only that action had to be taken, which is a no-brainer.

He said specifically that benefits to future retirees shuold be cut. I really don't want to have to retire to a foreign country to enjoymy retireement.

[Ned]

Here is exact testimony. He was talking about a number of government programs, including Medicaid.

"In view of this upward ratchet in government programs and the enormous uncertainty about the upper bounds of future demands for medical care, I believe that a thorough review of our spending commitments--and at least some adjustment in those commitments--is necessary for prudent policy. I also believe that we have an obligation to those in and near retirement to honor what has been promised to them. If changes need to be made, they should be made soon enough so that future retirees have time to adjust their plans for retirement spending and to make sure that their personal resources, along with what they expect to receive from the government, will be sufficient to meet their retirement needs.

I certainly agree that the same scrutiny needs to be applied to taxes. However, tax rate increases of sufficient dimension to deal with our looming fiscal problems arguably pose significant risks to economic growth and the revenue base. The exact magnitude of such risks is very difficult to estimate, but they are of enough concern, in my judgment, to warrant aiming to close the fiscal gap primarily, if not wholly, from the outlay side."

http://www.federalreserve.gov/boarddocs/testimony/2004/20040225/default.htm

Clearly he did not advocate anything that would pull the rug out from the soon-to-be-retired.

[Whoha]

Originally posted by Oncle Boris
What about they cut military spendings first, and then cease any military help program to non-democratic governments?

When that's done, they cut on SS if they still need to.

Military spending is less then SS spending, plus the Military spending won't massively spike up in the coming years. Thats why.

My plan of course is a 35% across the board cut.

[Sava]

Originally posted by David Floyd
Stuie, che isn't interested in a fair plan, he's interested in a wealth transfer plan - transfering wealth from those who earned it to those who didn't.

inherited wealth is UNEARNED!!!

plus, capitalism is wealth transfer... buying something is wealth transfer... so your silly little argument is, well, silly.

progressive taxation is the fairest form of taxation... those who CAN afford to be taxed are... and those who can't afford to be taxed are provided social services.

Sorry, we're not going to return to the 19th century policies you love so much.

And you're a moron.

right back at you... but at least I don't pretend to be some kind of internet know-it-all I'm open about my moronity

Actually, it is, since those "millions of people" generally don't have a decent government retirement even at current taxing and spending levels. So **** it, the system doesn't work, let's do something else.

SS used to be a decent program until the tax cut happy corporatists started destroying it... we should strengthen and improve the program. Plus you live in Mexico, so don't worry about what goes on here.

[Kidlicious]

Originally posted by Ned
"The exact magnitude of such risks is very difficult to estimate, but they are of enough concern, in my judgment, to warrant aiming to close the fiscal gap primarily, if not wholly, from the outlay side."

Clearly he did not advocate anything that would pull the rug out from the soon-to-be-retired.

He advocated making the tax cuts permanent and cutting benefits. It's clear and explicit.