Collect Social Security at 62 or 66? (2015, grandma, housing, support)

[highcotton]

Originally Posted by Mircea

That is incorrect and you have misled people.

Unlike you, I draw conclusions based on facts (Yeah, right!), rather than espouse beliefs based on emotion.

Here is a fact (page numbers are as they appear in Adobe Reader and not physical page numbers).



I did only a cursory examination of the OADI Trust Fund data and projections, because time is better spent evaluating the OASI and HI Trust Funds. The reason your statement is incorrect, is because once the OADI Trust Fund is exhausted, then OADI is funded out of the OASI Trust Fund.

For that reason, the combined OASI/OADI Trust Funds are projected to become exhausted in 2036, not 2037, which is exactly what the report says, and I quoted it above.

Will the OADI Trust Fund become exhausted in 2018? No, it will become exhausted far earlier. How much earlier? Again, I didn't evaluate it, but we can make some assumptions applying facts and logic.



Study: SSD applications increase when unemployment ends | Los Angeles Social Security Disability Attorney Blog



Increasing number of Social Security disability claims awarded | Columbus Workers' Compensation Attorney Blog

Not only have the number of benefit applications increased, but so have the number of people receiving benefits. That increase is far greater than what Social Security anticipated.

We can then logically conclude that the OADI Trust Fund will be exhausted in 2017 rather than 2018.

Some of the terms I use might be foreign or alien to people, and so to explain it in way that they might better understand it, in 2010 you had a certain number of people working. In 2011, the number of working Americans decreased. In 2012, the number of working Americans will decrease further still.

In addition to a declining number of working Americans, they are also working for less money. Someone who was employed but is now underemployed is earning less. Someone who was working full-time is now working part-time and earning less. They may even be working 2 part-time jobs, yet they will still be earning less than what they made in 2008, 2009 or 2010.

Those two factors together result in reduced revenues for Social Security and Medicare. If fewer people are working, and they are also earning less, then how can Social Security or Medicare revenues increase?

They cannot increase. That's just simple math (not emotion).



Social Security was projected to receive $482.7 Billion in 2011 and $616.1 Billion in 2012.

616.1
482.7
------
133.4 = Difference

133.4 / 482.7 = 27.63%

Social Security's revenues are going to increase 27.63% in 2012? Sorry, wrong answer. That is mathematically impossible unless your unemployment rate was 5.0% AND your labor participation rate was >66.5% as of January 1, 2012. It was not, and it won't be for this year.



104.6
-82.0
-----
22.6 = Difference

22.6 / 82.0 = 27.56%

Again, I ask, will the tax revenues for OADI increase 27.56% in 2012? No, again that is not possible for the reasons previously stated.

What conclusion can we draw about the OADI Trust Fund and its date of exhaustion?

It will be earlier than 2018.

If Truth is fear-mongering, then so be it.

Back to the point, if the failure of the OADI Trust Fund in 2018 causes the OASI Trust Fund to fail in 2036 instead of 2037, then what impact will an earlier failure of the OADI Trust Fund have on the OASI Trust Fund? It will cause it to fail earlier as well.





I just proved you wrong. (You didn't prove anything!)

Specifically, it says "...77 percent of scheduled benefits..." which is a 23% across the board reduction. It does not say "77% for all new retirees."

According to the verbatim quote from Social Security, if you have 65 years today, then in the year 2036 when you have 89 years your benefits will be reduced 23%.

But as I proved earlier (Ha!), OASI will be exhausted before 2036.

And if you eliminate the cap? There are negative consequences. For those between $100,000 and $250,000 you just pulled $23 Billion out of your economy. It doesn't sound like much, but note that is $23 Billion that cannot be spent at restaurants, sporting events, clothing stores, retailers etc, etc, etc. Taking the average State sales tax to be 7.5% that is also a loss of $1.7 Billion in sales tax revenues, and while that sounds like a lot, on a per State average that would be $34 Million.

I guess my question to all of you is can your State afford to lose ~$34 Million in sales tax revenues?

We're talking Cause & Effect here. How many services will be cut or reduced, or State, county, and city employees laid off permanently because of that?

"Trickle-Down" can be positive or negative. I'm not saying don't eliminate the cap, I'm just saying that it will not fix Social Security and that there are negative consequences to doing. I suppose spreading the pain around might help somewhat.

Might interest in Social Security stems from my mother. She was approaching retirement age, but as a neuro-psychologist, she can work well beyond that (and testifying as an expert witness in civil court cases is fun and profitable and often involves travel). So I've been following Social Security for some time now and advising her.

What you notice is that over the last 8 years as the number of people in your work force has steadily declined, and so have the revenues Social Security receives and that has resulted in the default date being moved up constantly. The Trust Fund will default far earlier than 2036, and when it does, there will be across the board cuts to benefits and no person will be exempted.

If people want to delude themselves into thinking their benefits will not be cut, then they can do so, but they're basing that on emotion, not facts. (No facts from you!) Just to be sure everyone understands, Social Security is saying that the combined OASI/OADI Trust Fund will be exhausted in 2036 and at that time, all benefits will be paid by tax revenues from workers. Social Security projects that the number of working Americans and their income will only fund 77% of benefits

Where will the other 23% come from, the General Fund? No. You'll need $1 TRILLION to pay for it, and you won't have that in the General Fund. Run a budget deficit? When your GDP is $18 TRILLION and your National Debt is $34 TRILLION you will no longer be running budget deficits, because there will be no one to buy your bonds. Eliminate the cap? Okay, your benefits only get cut 17%.

Now what? Raise the FICA tax to 16.4%? There are negative consequences to your economy for doing that.

In another thread I mentioned that a good thread topic might be "What will you have to sacrifice for a 16.4% FICA rate?" If you're earning $40,000 you would lose an additional $367/month. What changes to your life-style would you have to make without that $367? Note that someone earning $30,000 would lose $255/month. If you're already living paycheck-to-paycheck, how can you afford to lose $255/month?

And as I mentioned, a State like Ohio would lose $5 Billion to $7 Billion in sales tax revenues. Ohio's annual budget is $26 Billion. The losses would make that $19 Billion to $21 Billion. What cuts to schools, services, programs etc would Ohio have to make? I would also mention that Ohio's State, county and city pension plans are in trouble.

I mention that only because you have a systemic problem as a society that is not resolvable based on your present courses of action. You owe more money in private, public and government pensions, and Social Security and Medicare than you can possibly pay for. To attempt to pay for it will cause extreme financial hardships. That is not fear-monger that is economics.

Nothing more, nothing less...

Mircea




Legally, I only need to show that Social Security will fail without new entrants to the program in order to prove that it is a Ponzi Scheme, so in the strictest sense of the definition, Social Security is a Ponzi Scheme. If tomorrow we said that no one age 18 or under will pay into Social Security, then the system would collapse, because it is not self-sustaining.

That is the crux of the issue with a Ponzi Scheme. A normal investment scheme will work regardless of the number of investors. There have been transparent Ponzi Schemes in the past. While investors are often lied to, and fraudulent claims are often made involving Ponzi Schemes, those are simply characteristics of the scheme. Even if you never lied and you were totally transparent, if your investment scheme relies on new entrants or investors, then it is a Ponzi Scheme.

This...

2) A Ponzi scheme, by definition, will collapse when it runs out of new investors. Under Soc. Sec., there will always be a pool of workers paying in; that number will never fall to zero or anywhere close to zero.

...is inherently contradictory, and in fact proves that Social Security is Ponzi Scheme.

I could threaten and coerce new investors into my scheme so they there will always be a pool of investors, but it would still be a Ponzi Scheme nonetheless.

You claim there will always be a pool of workers paying in to Social Security. Okay, what if that pool is only 50 workers. Will Social Security collapse or survive?

In the bible it mentions a "plague of the first-born." What if there was plague of the under-35?

A few years ago, your labor force was 147 Million. As of January 31 it is 139 Million and you cannot pay for Social Security with only 139 Million workers. What if 5 years from now your labor force is 135 Million? And 10 years from now it is 130 Million?

How will you be able to pay for Social Security? Well, you won't be able to do that, unless you get more workers paying in. Okay, you can still pay benefits, but only if you reduce the amount of benefits.

Perhaps if the government invested the money, it would get a greater return, but what if the government invested in Blockbuster? Or K-Mart? Or Solyndra?

Oooops.

We don't want to go there for obvious reasons.

In spite of the fact that Social Security is a Ponzi Scheme, I still support it. Could it be administered and operated better? Certainly. Part of the problem stems from the fact that the program was never fully funded. The law should have had a built-in mechanism that required regular increases in the FICA tax rate to ensure its viability, as well as protections to prevent Congress using the funds for anything other than their intended purpose.

As I said, based on the previous recommendations by presidential commissions, the FICA tax rate should be in the 9%-10% range right now, but it isn't. If it was, you'd have wonder how that would have affected your economy over the last 15 years or so.

Contrarily...

Mircea

You have sited absolutely nothing but 'studies', 'projections' 'blogs' and 'recommendations'! These are essentually worthless. There have been NO CHANGES MADE, currently or for the future... I don't know why you seem to think that 'studies', 'projections' and 'recommendations' should be considered to be facts, and taken to be absolute changes that Congress will make. Has Congress voted to make any benefit changes for people that have already qualified for Social Security benefits? No! You're way, way out in left field with your speculations...

[BigJon3475]

Originally Posted by Mircea

That is incorrect and you have misled people.

Unlike you, I draw conclusions based on facts, rather than espouse beliefs based on emotion.

Here is a fact (page numbers are as they appear in Adobe Reader and not physical page numbers).



I did only a cursory examination of the OADI Trust Fund data and projections, because time is better spent evaluating the OASI and HI Trust Funds. The reason your statement is incorrect, is because once the OADI Trust Fund is exhausted, then OADI is funded out of the OASI Trust Fund.

For that reason, the combined OASI/OADI Trust Funds are projected to become exhausted in 2036, not 2037, which is exactly what the report says, and I quoted it above.

Will the OADI Trust Fund become exhausted in 2018? No, it will become exhausted far earlier. How much earlier? Again, I didn't evaluate it, but we can make some assumptions applying facts and logic.



Study: SSD applications increase when unemployment ends | Los Angeles Social Security Disability Attorney Blog



Increasing number of Social Security disability claims awarded | Columbus Workers' Compensation Attorney Blog

Not only have the number of benefit applications increased, but so have the number of people receiving benefits. That increase is far greater than what Social Security anticipated.

We can then logically conclude that the OADI Trust Fund will be exhausted in 2017 rather than 2018.

Some of the terms I use might be foreign or alien to people, and so to explain it in way that they might better understand it, in 2010 you had a certain number of people working. In 2011, the number of working Americans decreased. In 2012, the number of working Americans will decrease further still.

In addition to a declining number of working Americans, they are also working for less money. Someone who was employed but is now underemployed is earning less. Someone who was working full-time is now working part-time and earning less. They may even be working 2 part-time jobs, yet they will still be earning less than what they made in 2008, 2009 or 2010.

Those two factors together result in reduced revenues for Social Security and Medicare. If fewer people are working, and they are also earning less, then how can Social Security or Medicare revenues increase?

They cannot increase. That's just simple math (not emotion).



Social Security was projected to receive $482.7 Billion in 2011 and $616.1 Billion in 2012.

616.1
482.7
------
133.4 = Difference

133.4 / 482.7 = 27.63%

Social Security's revenues are going to increase 27.63% in 2012? Sorry, wrong answer. That is mathematically impossible unless your unemployment rate was 5.0% AND your labor participation rate was >66.5% as of January 1, 2012. It was not, and it won't be for this year.



104.6
-82.0
-----
22.6 = Difference

22.6 / 82.0 = 27.56%

Again, I ask, will the tax revenues for OADI increase 27.56% in 2012? No, again that is not possible for the reasons previously stated.

What conclusion can we draw about the OADI Trust Fund and its date of exhaustion?

It will be earlier than 2018.

If Truth is fear-mongering, then so be it.

Back to the point, if the failure of the OADI Trust Fund in 2018 causes the OASI Trust Fund to fail in 2036 instead of 2037, then what impact will an earlier failure of the OADI Trust Fund have on the OASI Trust Fund? It will cause it to fail earlier as well.





I just proved you wrong.

Specifically, it says "...77 percent of scheduled benefits..." which is a 23% across the board reduction. It does not say "77% for all new retirees."

According to the verbatim quote from Social Security, if you have 65 years today, then in the year 2036 when you have 89 years your benefits will be reduced 23%.

But as I proved earlier, OASI will be exhausted before 2036.

And if you eliminate the cap? There are negative consequences. For those between $100,000 and $250,000 you just pulled $23 Billion out of your economy. It doesn't sound like much, but note that is $23 Billion that cannot be spent at restaurants, sporting events, clothing stores, retailers etc, etc, etc. Taking the average State sales tax to be 7.5% that is also a loss of $1.7 Billion in sales tax revenues, and while that sounds like a lot, on a per State average that would be $34 Million.

I guess my question to all of you is can your State afford to lose ~$34 Million in sales tax revenues?

We're talking Cause & Effect here. How many services will be cut or reduced, or State, county, and city employees laid off permanently because of that?

"Trickle-Down" can be positive or negative. I'm not saying don't eliminate the cap, I'm just saying that it will not fix Social Security and that there are negative consequences to doing. I suppose spreading the pain around might help somewhat.

Might interest in Social Security stems from my mother. She was approaching retirement age, but as a neuro-psychologist, she can work well beyond that (and testifying as an expert witness in civil court cases is fun and profitable and often involves travel). So I've been following Social Security for some time now and advising her.

What you notice is that over the last 8 years as the number of people in your work force has steadily declined, and so have the revenues Social Security receives and that has resulted in the default date being moved up constantly. The Trust Fund will default far earlier than 2036, and when it does, there will be across the board cuts to benefits and no person will be exempted.

If people want to delude themselves into thinking their benefits will not be cut, then they can do so, but they're basing that on emotion, not facts. Just to be sure everyone understands, Social Security is saying that the combined OASI/OADI Trust Fund will be exhausted in 2036 and at that time, all benefits will be paid by tax revenues from workers. Social Security projects that the number of working Americans and their income will only fund 77% of benefits

Where will the other 23% come from, the General Fund? No. You'll need $1 TRILLION to pay for it, and you won't have that in the General Fund. Run a budget deficit? When your GDP is $18 TRILLION and your National Debt is $34 TRILLION you will no longer be running budget deficits, because there will be no one to buy your bonds. Eliminate the cap? Okay, your benefits only get cut 17%.

Now what? Raise the FICA tax to 16.4%? There are negative consequences to your economy for doing that.

In another thread I mentioned that a good thread topic might be "What will you have to sacrifice for a 16.4% FICA rate?" If you're earning $40,000 you would lose an additional $367/month. What changes to your life-style would you have to make without that $367? Note that someone earning $30,000 would lose $255/month. If you're already living paycheck-to-paycheck, how can you afford to lose $255/month?

And as I mentioned, a State like Ohio would lose $5 Billion to $7 Billion in sales tax revenues. Ohio's annual budget is $26 Billion. The losses would make that $19 Billion to $21 Billion. What cuts to schools, services, programs etc would Ohio have to make? I would also mention that Ohio's State, county and city pension plans are in trouble.

I mention that only because you have a systemic problem as a society that is not resolvable based on your present courses of action. You owe more money in private, public and government pensions, and Social Security and Medicare than you can possibly pay for. To attempt to pay for it will cause extreme financial hardships. That is not fear-monger that is economics.

Nothing more, nothing less...

Mircea




Legally, I only need to show that Social Security will fail without new entrants to the program in order to prove that it is a Ponzi Scheme, so in the strictest sense of the definition, Social Security is a Ponzi Scheme. If tomorrow we said that no one age 18 or under will pay into Social Security, then the system would collapse, because it is not self-sustaining.

That is the crux of the issue with a Ponzi Scheme. A normal investment scheme will work regardless of the number of investors. There have been transparent Ponzi Schemes in the past. While investors are often lied to, and fraudulent claims are often made involving Ponzi Schemes, those are simply characteristics of the scheme. Even if you never lied and you were totally transparent, if your investment scheme relies on new entrants or investors, then it is a Ponzi Scheme.

This...

2) A Ponzi scheme, by definition, will collapse when it runs out of new investors. Under Soc. Sec., there will always be a pool of workers paying in; that number will never fall to zero or anywhere close to zero.

...is inherently contradictory, and in fact proves that Social Security is Ponzi Scheme.

I could threaten and coerce new investors into my scheme so they there will always be a pool of investors, but it would still be a Ponzi Scheme nonetheless.

You claim there will always be a pool of workers paying in to Social Security. Okay, what if that pool is only 50 workers. Will Social Security collapse or survive?

In the bible it mentions a "plague of the first-born." What if there was plague of the under-35?

A few years ago, your labor force was 147 Million. As of January 31 it is 139 Million and you cannot pay for Social Security with only 139 Million workers. What if 5 years from now your labor force is 135 Million? And 10 years from now it is 130 Million?

How will you be able to pay for Social Security? Well, you won't be able to do that, unless you get more workers paying in. Okay, you can still pay benefits, but only if you reduce the amount of benefits.

Perhaps if the government invested the money, it would get a greater return, but what if the government invested in Blockbuster? Or K-Mart? Or Solyndra?

Oooops.

We don't want to go there for obvious reasons.

In spite of the fact that Social Security is a Ponzi Scheme, I still support it. Could it be administered and operated better? Certainly. Part of the problem stems from the fact that the program was never fully funded. The law should have had a built-in mechanism that required regular increases in the FICA tax rate to ensure its viability, as well as protections to prevent Congress using the funds for anything other than their intended purpose.

As I said, based on the previous recommendations by presidential commissions, the FICA tax rate should be in the 9%-10% range right now, but it isn't. If it was, you'd have wonder how that would have affected your economy over the last 15 years or so.

Contrarily...

Mircea

I can't force them to take a brown lunch bag or to drop out of the back of a plane.

I can push them and pee on them on their way out though.

Peeing..

BigJon3475

[texdav]

WS is exactkly what it was poassed as a law. Nothing more and nothing less.It5s not a retirement sytem;not a guaranteee of certain amount but a supplement to a retirement paln. For years now most have gotten mucvh more than they put in over their lifetime. It doesn't even disappear like most when the perso retires in many cases.

[Escort Rider]

Originally Posted by highcotton

You have sited absolutely nothing but 'studies', 'projections' 'blogs' and 'recommendations'! These are essentually worthless. There have been NO CHANGES MADE, currently or for the future... I don't know why you seem to think that 'studies', 'projections' and 'recommendations' should be considered to be facts, and taken to be absolute changes that Congress will make. Has Congress voted to make any benefit changes for people that have already qualified for Social Security benefits? No! You're way, way out in left field with your speculations...

Although you were responding not to me, but to poster Mircea, I want to comment. I bolded the word "speculations" for this reason: If we are talking about the future of Social Security, all of our talk is speculation because no one can know the future with any certainty. The official annual Trustees report is speculation because they have to make economic assumptions about the future in order to calculate what they calculate. If you assume that Congress will do something, or do nothing, or do X, Y, or Z, that is speculation too. If you assume that people who have already qualified for Social Security benefits will see no changes if Congress doesn't vote for any changes, that is speculation too because when the trust fund is exhausted and outgo exceeds income, benefits will be cut if Congress does nothing.

Now having said that, there is intelligent speculation based on sound reasoning and some knowable facts, and there is speculation based solely on prejudice, or wishful thinking, or denial. I would place Mircea's speculation in the former category, and yours in the latter. Something about Mircea's conclusions has caused you to react negatively in an un-thinking way. Is it fear that he might be right? None of us like to think about a grim future. But when you dismiss out of hand (as "way out in left field") conclusions which have been so carefully reasoned and justified, something is wrong.

If you disagree with the reasoning - and there is certainly room for that - then you need to say why. I'll be waiting. And I'll be waiting for specifics, not the vague generalities you have given us so far.

[highcotton]

Originally Posted by Escort Rider

Although you were responding not to me, but to poster Mircea, I want to comment. I bolded the word "speculations" for this reason: If we are talking about the future of Social Security, all of our talk is speculation because no one can know the future with any certainty. The official annual Trustees report is speculation because they have to make economic assumptions about the future in order to calculate what they calculate. If you assume that Congress will do something, or do nothing, or do X, Y, or Z, that is speculation too. If you assume that people who have already qualified for Social Security benefits will see no changes if Congress doesn't vote for any changes, that is speculation too because when the trust fund is exhausted and outgo exceeds income, benefits will be cut if Congress does nothing.

Now having said that, there is intelligent speculation based on sound reasoning and some knowable facts, and there is speculation based solely on prejudice, or wishful thinking, or denial. I would place Mircea's speculation in the former category, and yours in the latter. Something about Mircea's conclusions has caused you to react negatively in an un-thinking way. Is it fear that he might be right? None of us like to think about a grim future. But when you dismiss out of hand (as "way out in left field") conclusions which have been so carefully reasoned and justified, something is wrong.

If you disagree with the reasoning - and there is certainly room for that - then you need to say why. I'll be waiting. And I'll be waiting for specifics, not the vague generalities you have given us so far.

I agree that everything, on both sides of the topic, is nothing more than mere speculation. But my speculation has far greater certainty of being correct. My view has stood the test of time for many decades as the Social Security system's collapse has been studied, reported on, discussed, speculated on since the 1970s or before. Guess what - no benefit money has ever been reduced or taken away from anyone that already had qualified for benefits. Right? Damn right! Think!!!

I disagree that any change will be made for people that have 'already' qualified for benefits. I believe there will be no changes for people that are [say] age 50 or older. My reasoning for this belief is simple. The very people such a change would affect (if benefits were reduced or done away with) are not able to find a source to replace the SS benefits. Many, if not most, of these people depend on SS to exist...literally. It's not as if [most of] these people have ample savings or can go out and get a job to replace that lost money. This happens to be THE major problem with any change that affects people that have already retired. You can't cut that money from people that are in their 60s, 70s, 80s and 90s!!! Everyone with an IQ over the SS FRA should know that!

Let's get real about this. Why do you think nothing has been done about the failing SS system before? Two reasons - one being the reason I just stated above, and the other reason being political. A large percentage of the population are of the age that qualify for SS. Throw in another large group of people that are within 10-15 years of qualifying and we're talking about a huge number of people that a change would affect. The answer to the problem is making benefit changes to the [much] younger people that are no where near the age of receiving benefits yet. Another thing they should consider is to lift the income cap. Increase the full retirement age, etc. But make these changes to people that are under age 50, or 40, or 30...not the people that have already qualified or close to qualifying. To reduce or do away with benefits for people that have already qualified for benefits is simply NOT going to happen. I think that is a very safe speculation... Logic and reasoning, or logical reasoning, says so!

Now then, I truly do hope you realize that reports, studies, projections, assumptions, and other such 'stuff' from (or about) the Social Security system (and it's future collapse) have been going on for decades...many decades. Lastly, I truly do hope you realize that many Federal programs are not pay-as-you-go - as the Social Security system was designed to work, with payments to current retirees coming from current payments into the system. There are ways to 'fix' the system, some of which I touched on, but none are very popular. But I can assure of one thing that would be totally devastating - take away the benefit from great-grandma and great-grandpa. It ain't gonna happen!!!!!!!!!!!!!!!

[rothbear]

Both hubby and I have been planning to retire at 62 (well me at 62 and hubby at 63) for many years now. We have done the calculations and would rather take less earlier and enjoy it when we can. His father, whose genetics he seems to exhibit more than his mother's, died at age 74 and both my parents died at 83, so we have no illusions of extremely long lives.

Lately we had been having some second thoughts, but unfortunately I'm going to have to stick to the original plan because I am one of the many "older" people who lost their jobs and are unable to find anything else that I can physically do (back problems don't allow me to stand for long periods of time, like at a fast food place or store). As it is my UI is going to run out 1.5 years before I can retire, but we have been cutting down expenses and living on less. The health insurance, though, is going to be our nemesis. We both may end up getting some kind of part time work, or even do some contract or self-employment stuff. Hubby thinks I should start a pet sitting service! Not sure what will happen, but I guess we will adapt like we did when I lost my job.

[Escort Rider]

Originally Posted by highcotton

I agree that everything, on both sides of the topic, is nothing more than mere speculation. But my speculation has far greater certainty of being correct. My view has stood the test of time for many decades as the Social Security system's collapse has been studied, reported on, discussed, speculated on since the 1970s or before. Guess what - no benefit money has ever been reduced or taken away from anyone that already had qualified for benefits. Right? Damn right! Think!!!

I disagree that any change will be made for people that have 'already' qualified for benefits. I believe there will be no changes for people that are [say] age 50 or older. My reasoning for this belief is simple. The very people such a change would affect (if benefits were reduced or done away with) are not able to find a source to replace the SS benefits. Many, if not most, of these people depend on SS to exist...literally. It's not as if [most of] these people have ample savings or can go out and get a job to replace that lost money. This happens to be THE major problem with any change that affects people that have already retired. You can't cut that money from people that are in their 60s, 70s, 80s and 90s!!! Everyone with an IQ over the SS FRA should know that!

Let's get real about this. Why do you think nothing has been done about the failing SS system before? Two reasons - one being the reason I just stated above, and the other reason being political. A large percentage of the population are of the age that qualify for SS. Throw in another large group of people that are within 10-15 years of qualifying and we're talking about a huge number of people that a change would affect. The answer to the problem is making benefit changes to the [much] younger people that are no where near the age of receiving benefits yet. Another thing they should consider is to lift the income cap. Increase the full retirement age, etc. But make these changes to people that are under age 50, or 40, or 30...not the people that have already qualified or close to qualifying. To reduce or do away with benefits for people that have already qualified for benefits is simply NOT going to happen. I think that is a very safe speculation... Logic and reasoning, or logical reasoning, says so!

Now then, I truly do hope you realize that reports, studies, projections, assumptions, and other such 'stuff' from (or about) the Social Security system (and it's future collapse) have been going on for decades...many decades. Lastly, I truly do hope you realize that many Federal programs are not pay-as-you-go - as the Social Security system was designed to work, with payments to current retirees coming from current payments into the system. There are ways to 'fix' the system, some of which I touched on, but none are very popular. But I can assure of one thing that would be totally devastating - take away the benefit from great-grandma and great-grandpa. It ain't gonna happen!!!!!!!!!!!!!!!

Thank you for responding at greater length. However, you and Mircea seem to be talking about two different things. You say that benefits will not be taken away from those who are already receiving them (and I agree this will probably never happen), but Mircea is talking about the demographics and the economy and the projections for the year in which the Trust Fund will run out of "money" (or Special Treasury Bonds to redeem). When that point is reached, then there will be a reduction in benefits unless Congress does something. Now I tend to agree with you that Congress will finally do something, either at that time or hopefully sooner. Contrary to your died-in-the-wool optimism, we are in a very worrisome situation. It is worrisome that Congress has so far declined to take any action - and you have suggested several - because the longer they wait the more drastic the action will have to be. And it is worrisome that the year in which the system will go cash-negative is apparently a lot closer than we have been led to believe. The latter issue (the year of exhaustion of the Trust Fund) is Mircea's principal point, but you gloss over it as if you weren't aware of it.

It's like you and Mircea are talking past each other, making different but related points. You say your view has "stood the test of time". Yes, the Social Security system has worked pretty well for quite a long time, but you seem to be in denial that times are different now; demographics have changed radically. Your reasoning seems to be that because something would cause a lot of turmoil and suffering, then that something just cannot happen. While we all hope it will not happen, I say your view is Pollyanish; you can use all the exclamation marks you want but exclamation marks will not change the situation one iota. Because something is unthinkable in your mind doesn't remove it from the realm of the possible. It was unthinkable to most of us twenty years ago that the basic economic fundamentals could become so shaky, not only in the United States but also in Europe. Very worrisome. There will be no return to the easy prosperity of the 60 years following World War II.

[highcotton]

Originally Posted by Escort Rider

Thank you for responding at greater length. However, you and Mircea seem to be talking about two different things. You say that benefits will not be taken away from those who are already receiving them (and I agree this will probably never happen), but Mircea is talking about the demographics and the economy and the projections for the year in which the Trust Fund will run out of "money" (or Special Treasury Bonds to redeem). When that point is reached, then there will be a reduction in benefits unless Congress does something. Now I tend to agree with you that Congress will finally do something, either at that time or hopefully sooner. Contrary to your died-in-the-wool optimism, we are in a very worrisome situation. It is worrisome that Congress has so far declined to take any action - and you have suggested several - because the longer they wait the more drastic the action will have to be. And it is worrisome that the year in which the system will go cash-negative is apparently a lot closer than we have been led to believe. The latter issue (the year of exhaustion of the Trust Fund) is Mircea's principal point, but you gloss over it as if you weren't aware of it.

It's like you and Mircea are talking past each other, making different but related points. You say your view has "stood the test of time". Yes, the Social Security system has worked pretty well for quite a long time, but you seem to be in denial that times are different now; demographics have changed radically. Your reasoning seems to be that because something would cause a lot of turmoil and suffering, then that something just cannot happen. While we all hope it will not happen, I say your view is Pollyanish; you can use all the exclamation marks you want but exclamation marks will not change the situation one iota. Because something is unthinkable in your mind doesn't remove it from the realm of the possible. It was unthinkable to most of us twenty years ago that the basic economic fundamentals could become so shaky, not only in the United States but also in Europe. Very worrisome. There will be no return to the easy prosperity of the 60 years following World War II.

Why are you so sure about your prediction of the future?

[Escort Rider]

Originally Posted by highcotton

Why are you so sure about your prediction of the future?

Good question, and of course it is conjecture (speculation) as we have agreed. Very briefly, the reason why I believe the fundamentals have changed for the United States in particular has to do with the offshoring of jobs, especially but not limited to manufacturing jobs. Since third-world countries can do it cheaper, our corporations have sent it there to have it done cheaper and thereby get a competitive advantage. We, as consumers, have endorsed that with our dollars even if we claim to be against it. So first, it was blue-collar jobs that were disappearing and everybody was supposed to go to college to be successful, but then as the trend continued and deepened, college has also ceased to be the magic cure. My prediction has other reasons in addition to offshoring, but I am trying not to write a book here.

[highcotton]

Originally Posted by Escort Rider

Good question, and of course it is conjecture (speculation) as we have agreed. Very briefly, the reason why I believe the fundamentals have changed for the United States in particular has to do with the offshoring of jobs, especially but not limited to manufacturing jobs. Since third-world countries can do it cheaper, our corporations have sent it there to have it done cheaper and thereby get a competitive advantage. We, as consumers, have endorsed that with our dollars even if we claim to be against it. So first, it was blue-collar jobs that were disappearing and everybody was supposed to go to college to be successful, but then as the trend continued and deepened, college has also ceased to be the magic cure. My prediction has other reasons in addition to offshoring, but I am trying not to write a book here.

Escort,

Both Social Security and Medicare have indeed been going broke for some time. Consider the following stories in the Los Angeles Times (please take note of the dates):

April 6, 1992 – “The new siren is a frank and gloomy assessment that the national trust fund that pays hospital bills for 34 million Americans on Medicare will be broke in 10 years.” That would be George H.W. Bush telling us that Medicare would be broke in 2002.

January 9, 1984 – “Some adjustments are needed to head off bankruptcy in the Medicare system. The trust fund that helps pay doctor and hospital bills for 29 million Americans will run out of money by 1990 if nothing is done” That would be President Reagan saying that Medicare would be broke by 1990.

June 20, 1980 – “Unless Congress acts, the Social Security fund will run out of money to pay retirement and survivors’ benefits by late 1981 or early 1982, the fund's government trustees reported Thursday.”

May 6, 1978 – “The Social Security trust funds that pay benefits to retired and disabled workers will be in good shape for several more decades but the fund that pays hospital insurance under Medicare will go broke by 1990, the trustees told Congress today.” That would be President Jimmy Carter with a “go broke" date of 1990.

August 30, 1960 – “That the [Medicare] bill passed was totally uninformed and almost totally irrational made no difference; the Democratic Presidential candidate can cry that he wanted to do more the old folks and the Republican candidate can say that the Congress might have done less if he hadn’t been so busy…We said that he bill was total uninformed, and it is…Nobody knows what it is right to do about medical aid to the aged because nobody has determined how many need help… Moreover, the political promoters have not had the courage to declare bluntly that everybody at age 65 receive a government health stipend, regardless of need…”

Oct. 8, 1940 – Republican Presidential candidate Wendell Willkie addressed Social Security – “…I want to say this in connection with Social Security that unless there is a change in administration those people who are presently paying into Social Security fund will never get any benefit there from…If it continues down the present path it will eventually bankrupt this country. We are bound to have either bankruptcy or inflation, and I say it very solemnly that those who are paying in on their Social Security will never get the principal of the Social Security when they need it in their old age…”

So Escort, in other words Social Security has been going bankrupt for over 70 years!

Social Security was on the verge of bankrupting the entire country before you were even born...or you were only a baby that wore cloth diapers. Since Social Security has been going bankrupt for over 70 years now, perhaps it will take another 70 years for it finally get there – or 70 years after that.

Whatcha got to say 'bout that news from decades ago?