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Every successful business person games the tax code. Why wouldn't they?
Here's what really happens.
Members of Congress look at their re-election campaign bank account balance. Whoops -- its is getting low. Time to generate campaign contributions!
"We need to look at reforming the tax code," their PR machines state. "We need more jobs in inner cities, so let's put in place tax reform to encourage it." Or, "We need to support our manufacturers who export products, not jobs, so let's reform the tax code to discourage job-exporting and encourage product-exporting." Or, back when the price of a gallon of gasoline was $4, "We need to investigate big oil companies." Or, "We need to eliminate harmful regulation that costs jobs." Or, "We need to protect the environment through tax changes." Etc, etc, etc, etc.
The purpose of those announcements is to signal to lobbyists it is time to fill up the re-election campaign coffers.
The Clintons, of course, are the consummate pay-to-play politicians, having gone from dead-broke to north of $200 Million through bribes, much of which came from foreign governments. But it goes far beyond the Clintons, of course; they just mastered it.
Personally, I recall contacting my US Senator to voice my & my company's views on a matter - and the staffer made it clear it would cost me a $1,000 campaign contribution. Not exactly those words, but it was made clear.
In December 2014 Congress added a last minute item to the budget that allowed multi-employer (private) defined benefit pension plans to make cuts for current retirees to get the plans out of "critical and declining status".
Twelve years ago when I retired I made many of my decisions based on an income that would not change because ERISA laws prevented cuts.
In July 2017 my pension is being cut by 60%. I will soon get just 40% of what I now get and that level of reduction means that I most likely will not be able to keep my home and face the daunting prospect of trying to sell rural property and move somewhere else at the age of 70+.
Don't assume that cuts to SS can't happen in the blink of an eye.
I certainly feel for you and others similarly situated. I'm sure you can correct me if I'm wrong. My understanding is your multi-employer (private) defined benefit pension plan, being "critical and declining" really put you between a rock and a hard place.
With no change, the plan would go belly-up and you would receive pennies on the dollar from the Pension Benefit Guarantee Corporation (a quasi-federal organization).
With the change, you receive 40 cents on the dollar -- but this is more than you would have received under the belly-up PBGC alternative.
You ended up the the lesser of the two bad outcomes.
Please note I didn't say all pregnancies are planned. I said childbirth is predictable and hence you can plan for it. If you are pregnant, and if you choose to carry the pregnancy (that is, you choose not to have an abortion), then you know with reasonable certainty you will have a baby about 9 months after conception. That part is predictable and planned. And it is silly to fund such a predictable and planned event in the same way we fund the repair of an automobile after an unplanned collision: through filling out an insurance form.
I carry collision insurance because I don't want to spend 20k to get a new car if mine is totaled. People pay for health insurance because they either can't or don't want to have to come up with up to $71,000 if they need a C-section. Why do you have trouble understanding that? All the planning in the world will not protect you from catastrophic expenses, that is WHY we buy insurance
I think part of the reason so many look to SS as their only retirement income is because those people never saved enough money during their working lives to be able to save any substantial amount for retirement.
I was thinking about this last night so I googled what the Gov't pays for a Medicare Advantage plan, this is all I could find and it's from 2011 so God only knows what it is now: Medicare Advantage plans on average received about $9,900 per person in 2011. That would be almost $20,000 a year for a couple on medicare, and who knows what the 'premium support' would amount to? if they included your investments and savings as assets then millions of people might end up paying the full bill and that would be a disaster.
On average, we consume about $10,000 of healthcare services per person each year.
So, healthcare insurance will cost about $10,000 plus administrative fees per person each year.
There is no getting around the math. People who pay less than $10K per year for healthcare insurance are being subsidized somewhere.
When SS was instituted, it was designed to be an insurance program, a minimal standard to provide some essentials. It has since been viewed by a lot of people as where the majority of their retirement should come from.
That's true but that has occurred mostly because of wage stagnation occurring at the same time that many benefit pensions have been discontinued and employers become increasingly stingy in offering some type of 401k match. You can only save what you have left after you pay for necessities and for millions of families there is nothing left. I have never met anyone who does not want to be able to save, but I sure know a lot of people who can't save.
On average, we consume about $10,000 of healthcare services per person each year. So, healthcare insurance will cost about $10,000 plus administrative fees per person each year. There is no getting around the math. People who pay less than $10K per year for healthcare insurance are being subsidized somewhere.
That's an accurate statement however most people think that what the Government spends on medicare is a legitimate expense. Very few of us have a desire to see the elderly die before their time because they can't afford health care.
I think part of the reason so many look to SS as their only retirement income is because those people never made enough money during their working lives to be able to save any substantial amount for retirement. Sad state of affairs that companies today (and for many years prior) pay so little for the hard work of their employees.
Quote:
Originally Posted by SportyandMisty
There. I fixed it for you.
I don't know what you think you fixed but you changed what I said. My point was:
because those people never made enough money during their working lives to be able to save any substantial amount for retirement.
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So, I'll just say:
