New singles majority is bad news for Social Security (pensions, spouses, 2013)

[mathjak107]

we get to save on spousal benefits and survivor benefits. also the average life span for married couples is greater than for singles. both from a standpoint that married folks seem to live longer as well as from a statistical standpoint since either person in a couple can out live the other the male vs female average life expectancy increases.

[Larry Siegel]

Originally Posted by PAhippo

They're assuming single women don't have kids.

Not a valid assumption.

I think they're using data on how many single women have kids. The children of single women often don't make a lot of money, and don't pay much into Social Security. If we want our entitlement state to be financially healthy we should encourage people to get married, stay married, have kids, and raise them with middle-class aspirations.

[augiedogie]

This article actually understates the problem. I've done a little research lately, and we do seem to have a significantly falling birth rate. Its not just the lack of people getting married. I've discovered that a lot of young couples are opting for zero or just one child. That also doesn't bode well for SS. I have a crazy idea that the declining birth rate is the reason that our govt. for many years now has been willing to open the border to the south. They need young bodies to keep the govt. afloat long term.

However, there other influences that are going to affect SS. We have a growing obesity problem, and it may be that the declining health and longevity of people will file sooner for disability under SS, but then again their lifespan will likely shorten. Its an interesting intellectual discussion, but it should be a lesson. SS is not very secure.

[Cruzincat]

The solution is already here, but you have to speak Spanish to appreciate it.

[TuborgP]

Originally Posted by Poncho_NM

First line was added as thread Title.

TY, verrrrrrrrrrrry much

[TuborgP]

Originally Posted by rjm1cc

I thought the problem would be lack of employed people to support the retired. Don't understand why singles would be a problem as spouse might be able to claim a higher benefit due to marriage and also survivor benefit.

Singles aren't having kids and kids become future tax payers contributing to the trust fund.

[TuborgP]

Originally Posted by brava4

Geez, you're just full of good news tonight.

Yup, hopefully food for thought which will differ for each of us. For some no food and they will just move on for others it will be something else.

[Hemlock140]

Originally Posted by PAhippo

They're assuming single women don't have kids.

Not a valid assumption.

Yes, in fact the number of unwed mothers is increasing rapidly too.

Single motherhood in U.S. increases sharply - The Washington Post

FastStats - Unmarried Childbearing

[rdflk]

Even though single women have kids....don't they still have FEWER of them (in general) than married women?

In that case even though single women with kids are 'factored in' -- the population and number of Soc. Sec. 'contributors' would still go down, but perhaps not as quickly.

[Mircea]

Originally Posted by TuborgP

Interesting analysis that many of us may not have thought of.

I did.

What else?

They don't save as much. They have virtually no personal savings or investments.

They also have a tendency to cash in their 401(k) upon termination or lay-off.

Originally Posted by TuborgP

Lots of food for thought especially for the youngest Boomers who are just that younger and hitting retirement in about 17 years at crunch time

Crunch time will be sooner than that.

You've had negative cash flow for 6 years now. That wasn't supposed to start happening until 14 years from now.

Revenues are flat, too. That's because 20% are part-timer workers and there's a global correction in wages for the over-paid.

Originally Posted by rjm1cc

I thought the problem would be lack of employed people to support the retired.

That's only one of the problems.

20% of your work-force is part-time. That's a problem.

Through your own fault, wages are stagnant/flat and will be through the end of the Century. That's a problem.

A huge chunk of your demographic that needs to be working, isn't working --- they're playing video games in mommy's basement. That's a problem.

For that demographic which is not working, their Earnings Curve is skewed, meaning they will peak at their highest wages much, much later in life, and their total life earnings will never be greater than their parents. That's a problem.

Round II of the Global Great Satan Smack-Down is going to start in about 4-6 years.

Right?

Automakers, including Ford, are building auto plants in India.

What conclusion can you draw from that?

India is preparing to enter the 2nd Level Economy.

What happened when China entered its 2nd Level Economy?

Oh, please, don't tell me you already forgot.

More of your 2nd Level Economy jobs will start heading to India, and probably your 3rd Level Economy jobs will go to China.

More unemployed, and lower wages.

Around 2042, you'll be reading the newspaper and see where Dongfeng-Ford and Jianghuai-Buick have opened up auto plants in Tashkent (Uzbekistan).

That will signal Round III of the Global Great Satan Smack-Down as Central Asia moves into their 2nd Level Economy.

The good news is your 2nd Level Economy will be gone, so you won't have to worry about additional job losses there. But you will in your 3rd and 4th Level Economies.

And about 25 years after that, you'll be reading where Fiat-Mercury and Hyundai-Hyummer are opening up plants in Timbuktu.

That will be the start of Round IV of the Global Great Satan Smack-Down as sub-Saharan Africa moves into their 2nd Level Economy.

It must be wonderful to be 10 years old, and have no Future to look forward.

Originally Posted by volosong

The solution is simple.

Of course, it is.

Originally Posted by volosong

To support our welfare state, (which is what we have become), we need to welcome immigrants from other countries. *** We have always been a country of immigrants, and that is what has made our country vibrant and growing.

You left out a very important part of the equation.

Why was there growth?

Because you were progressing economically.

You had an advanced Zero Level Economy, as evidenced by the import and export of agricultural products. You were fairly well developed in the 1st Level Economy with coal production, plus mining in iron, tin, copper, some gold and silver, plus minerals like salts and phosphates. Then you started with oil production.

You were dabbling in the 2nd Level Economy. You had railroads and iron-works, and a few other industries.

The process of Electro-Mechanical Industrialization allowed you to rapidly expand your 1st and 2nd Level Economies, and then move into the 3rd Level Economy. You hit the 4th Level Economy in the late 1960s.

You should have progressed into the 5th Level Economy in the mid-1990s....but you didn't, and you couldn't.

You still can't.

Had you progressed into the 5th Level Economy -- which is pure R&D -- then every manufacturing job you lost would have been replaced by 0.85-0.95 R&D jobs.

In other words, Joe-Bob trades in his steel-toed boots for comfy shoes to work in laboratory or research facility, or out in the field testing or researching.

Your primary and secondary education system is absolutely worthless, churning out garbage.

To fix the education system, everything that destroyed it has to be undone. Effectively you need to go back to 1925 or 1930 with no Department of Education, no massive federal bureaucracy with thousands of useless regulations, no teacher's union, no 2:1 ratio of Administrators to Teachers, and no 14:1 ratio of Administrators to Students, and no huge mega-school districts.

20 years from the day you complete that task, you'll be graduating students who can enter university and be trained for the 5th Level Economy.

Of course, by that time, the Chinese, Indians and Eastern Europeans will be completely entrenched in the 5th Level Economy, and the US won't be able to compete.

Originally Posted by BugsyPal

Social Security is a Pay As You Go (PAYG) system in that inflows first go towards paying benefits, what remains (a surplus) is either put into a "trust fund" and or can be "invested" (read loaned to the federal government).

No, that's not how it works.

FICA tax revenues are promptly paid out as benefits.

Any surplus FICA revenues are required by law -- the original 1935 Act -- to be converted into US treasury securities. The surplus cash is placed in the General Fund, and an IOU is placed in the Trust Fund.

There is no "either/or." The law is quite clear and always has been for those who comprehend English at the 6th Grade Level or higher.

Originally Posted by BugsyPal

At some point in the future and exactly when no one is really sure but the number of seniors will vastly out number working adults.

Not true. Try reading the reports more closely.

The ratio of Workers to Beneficiaries was to be 3:1 declining steadily until ~2035 at which it would be 2:1.

You've been at 2.3-2.0:1 for a few years now.

Short of a Plague of the 1st Born lasting for a few decades, there is no possibility beneficiaries could out-numbers.

Originally Posted by BugsyPal

Or Congress can vote increases in payroll taxes (again ditto) on younger workers which is really a direct transfer of their wealth to retirees.

The Silent Generation was slammed with 520% FICA tax increase to make sure Social Security would be there for them.

The Boomers suffered a 71% FICA tax increase to make sure Social Security would be there for them.

There's no "direct transfer of their wealth to retirees."

If people act now, at most a 47% increase in the FICA payroll tax is required.

If younger workers want Social Security, then they will have to do like everyone else and pay more.

Analyzing....

Mircea