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Yes, like I said, I think it'll be relatively simple to fix. The retirement age may increase by a year or two.
It will either be there, or people should demand their money back. SS is not a tax for a general fund, it is a system you pay into with the expectation it will pay out.
Longevity is strongly correlated with wealth and income, hence "the retirement age may increase by a year or two" is inherently regressive.
Then Congress should get rid of it, or state and local governments should use it as a rent cap.
Portland rents up 15% from Aug 2014 to Aug 2015 according to a tracking firm called Axiometrics...zero COLA.
The cpi has a use . It tracks price changes on a basket of goods and services. Many items may not even apply to things you use or do. It is merely a standardized way of measuring things . It has little to do with what you personally see. My sister refinanced and her expenses are below where they stood on a yearly basis 5 years ago.
My own are higher because of healthcare costs. But if I was working still, my costs would be lower with the company subsidized healthcare. I also rent so I did not benefit refinancing. But this is the second year in a row we have no rent increases. So the effects of inflation are different for all of us
What do you think is more likely to change? Aging or Politics? In two generations, we've seen a complete reversal in the racial & geographic constituencies of both parties. In half a generation, we've seen "the culture war" issues like gay marriage go from THE most important issue to not even worth a discussion.
Do you really think things won't change? When I hear young people say stuff like that, I wonder if they understand how our political system works at all. I wonder if they vote. Maybe not, because voter participation skyrockets from about 20% for under 34 voters to over 70% over age 50. By the time millennials are 50, they will be that voting majority.
I guarantee that when the millennials start to approach retirement age, they will elect politicians that will have a fire lit under them to fix social security. Fixing it won't even be that hard.
Of course things change, but as the old saying goes, "the more things change, the more they stay the same". Of the two choices you gave me, I honestly couldn't decide which is more likely to change. I keep hearing that 3D printed organs could double the life expectancy of the average person within my lifetime. On the other hand, the individual topics in politics change, sometimes drastically, as you stated, but the system itself stays very much the same. Politicians still look out for their constituencies short term best interests, fail to see the long term, and fail to see the overall picture. They squabble about petty differences, shut down the government over things that don't really matter, while putting their heads in the sand over real issues, because they are difficult or unpopular. In my opinion, they listen to the "wants" of their constituency, and often fail to address their "needs". Both sides are guilty of this, I'm not picking sides here. So while I know it wasn't the answer you were looking for, I'm going to go with aging being more likely to change in a more significant fashion.
Oh, and if you are saying that cultural topics are out of the discussion at this point, you aren't living in the same country I am. Gay marriage just barely became legal in my state in the last 2 years, and is still being hotly contested. I still see abortion protesters on the streets in my city. And pot is still illegal in my state. Racism and sexism are still very much alive across the entire country, just in less obvious ways than 50 years ago. I'm not saying it isn't getting better, but it definitely isn't "not even worth a discussion" at this point. Cultural issues are still very much a part of the conversation across much of the country.
Anyway, back on topic. I'm saying that having the younger generation vote to fix the problem once they are older DOESN'T fix the problem, it just shifts it again to the next generation, PLUS it is a lot easier to fix if you do it over a longer period of time, rather than all at once. Also, if there is one thing that HAS changed overall politically is that we have become a much more polarized nation, with BOTH sides much less willing to cross the aisle. That will lead to a trend where it becomes more and more difficult to get any laws changed at all. So by the time my generation is old enough to vote on a change, we might not be able to do much about it.
I'm not saying that fixing it won't be possible. I'm saying that waiting 30 years to fix it isn't the answer. They need to start the fix now, so that younger people have confidence in the system, and know what they will get. Almost everyone I know who is under 50 just assumes that they won't receive much, if anything from the SS system. So why not start addressing it now. Most of those people would be thrilled to know that they WILL get 75% of what today's retirees are getting, instead of 0%. I'm also saying that the longer we wait to address this, the more difficult it may be to pass anything fixing it.
And I've not only voted in the last 4 presidential elections (since I was 22, sorry I failed to vote when I was 18), I also vote in the off years, when almost no one does. And I do this despite the fact that I live in a state where my presidential vote doesn't really count, whichever way I vote, because the electoral college has voted red for my state practically every election in history. So yes, I do understand how the political system works in our country.
With people living longer, there has to be changes. When SS first paid out its first check in 1940, the minimum age for payment was 62 and the average life expectancy of a US citizen was just under 63! Today the minimum age for minimum payout is 62 and the average life expectancy of a US citizen is just under 80 years old!
A mix of things must happen. Either one must be changed to an extreme, or a small change can be done to each category.
1. Age requirement would need to go up. Estimate is upping the age ~3 years for each increase in payment. This was touched on in 1983 when congress passed legislation to slowly increase the full retirement age to 67 and further reduce payments to those who take it earlier at age 62 - 66. But more would need to be done.
2. Increase the SS income tax cap. Right now any income over $118,500 is exempt from being taxed into the program. So the people who can afford it the most pay a smaller % of their pay into the program than those who can afford it the least. This cap would need to be increased or eliminated.
3. The tax would need to be increased. Some estimate a 1 - 2% increase.
4. Changes to the COLA. The COLA increases would need to be reduced and based on a different basket of goods and services.
There are other options, but these are some of the biggies.
On a final note, the program must and will continue. Social Security is one of the most successful government programs in history and keeps millions of old and sick people from living on the streets.
With people living longer, there has to be changes. When SS first paid out its first check in 1940, the minimum age for payment was 62 and the average life expectancy of a US citizen was just under 63! Today the minimum age for minimum payout is 62 and the average life expectancy of a US citizen is just under 80 years old!
A mix of things must happen. Either one must be changed to an extreme, or a small change can be done to each category.
1. Age requirement would need to go up. Estimate is upping the age ~3 years for each increase in payment. This was touched on in 1983 when congress passed legislation to slowly increase the full retirement age to 67 and further reduce payments to those who take it earlier at age 62 - 66. But more would need to be done. 2. Increase the SS income tax cap. Right now any income over $118,500 is exempt from being taxed into the program. So the people who can afford it the most pay a smaller % of their pay into the program than those who can afford it the least. This cap would need to be increased or eliminated.
3. The tax would need to be increased. Some estimate a 1 - 2% increase.
4. Changes to the COLA. The COLA increases would need to be reduced and based on a different basket of goods and services.
There are other options, but these are some of the biggies.
On a final note, the program must and will continue. Social Security is one of the most successful government programs in history and keeps millions of old and sick people from living on the streets.
If you increased or eliminated the cap for higher earners would you then uncap the benefit potential as well?
If you increased or eliminated the cap for higher earners would you then uncap the benefit potential as well?
That is one of the many questions that would need to be taken into consideration, but it would seem that yes, the benefit potential would need to be capped, or what is the point? Especially considering the wealthy tend to live longer lives than those who are not.
That is one of the many questions that would need to be taken into consideration, but it would seem that yes, the benefit potential would need to be capped, or what is the point? Especially considering the wealthy tend to live longer lives than those who are not.
The benefit is already capped and so is the income the tax applies to, so hence my question if you raise or eliminate the income cap are you going to uncap the benefits?
Additionally are you above or below 118,500.00 in annual earnings?
The benefit is already capped and so is the income the tax applies to, so hence my question if you raise or eliminate the income cap are you going to uncap the benefits?
Additionally are you above or below 118,500.00 in annual earnings?
I would think if you wanted this to make any difference, you would have to keep the benefit capped and raise the income cap.
Another idea is to means test the payouts, so if you have assets or other income streams over a certain amount, your benefits would be reduced. I personally think there would be too much paperwork involved. Our tax code is already crazy enough.
I am well over the current 118,500 income cap. I live in NYC. That is practically a working class income here
I would think if you wanted this to make any difference, you would have to keep the benefit capped and raise the income cap.
I agree with this
Quote:
Another idea is to means test the payouts, so if you have assets or other income streams over a certain amount, your benefits would be reduced. I personally think there would be too much paperwork involved. Our tax code is already crazy enough.
I'm not as much in favor of this as I am your first point. I think raising or elimnating the cap plus possibly extending FRA would be sufficient to not need means testing
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I am well over the current 118,500 income cap. I live in NYC. That is practically a working class income here
I'm over as well and was just curious. The suggestion if most often floated by those not impacted by the suggestion
Another idea is to means test the payouts, so if you have assets or other income streams over a certain amount, your benefits would be reduced. I personally think there would be too much paperwork involved. Our tax code is already crazy enough.
"Taxation of benefits if you have other income" already exists.
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