Posted on 01/05/2011 9:57:10 AM PST by red meat conservative
When Bernie Madoff was caught running a Ponzi scheme, he was sentenced to lifetime imprisonment. Needless to say, the Ponzi scheme was prorogated immediately. Unfortunately, when the leftists in government were caught purloining the funds from the mandatory Social Security retirement program, they were rewarded with reelection. Worse yet, they still have the power to force us to contribute more, receive less, and raise the retirement age in order to perpetuate and exacerbate the greatest Ponzi scheme of all time.
It is quite evident that Democrats are content with their 'don't ask don't tell' policy concerning Social Security. They are happy to continue bankrupting this nation, while remaining silent regarding the impending implosion of Social Security. Republicans are justified in their vocal concern over the program's insolvency and their calls for reform. However, it is extremely disconcerting to hear many conservatives support the idea of digging deeper into this unconstitutional confiscatory program. Many conservatives have adulated the recommendations of the debt commission because they “address” the Social Security crisis. The problem is that they address the insolvency by implementing one or more of the following changes; cutting benefits, raising payroll taxes, raising the exemption limit, means testing benefits, and (most egregiously) raising the retirement age. The need and desire to address a policy problem is no excuse for proposing the wrong solution.
On Sunday, Lindsey Graham made headlines by asserting that he would not support raising the debt ceiling until the long term fiscal problems are solved. Sounds conservative, right? Think again. Here is the full quote from Lindsey Graham on Meet the Press:
“I will not vote for the debt ceiling increase until I see a plan in place that will deal with our long-term debt obligations, starting with Social Security, a real bipartisan effort to make sure that Social Security stays solvent, adjusting the age, looking at means tests for benefits. On the spending side, I’m not going to vote for debt ceiling increase unless we go back to 2008 spending levels, cutting discretionary spending.” (emphasis added)
So, now we have Republicans openly suggesting that we perpetuate a Democrat disaster by means testing the hard earned retirement money that Americans toiled for their entire life. Worse yet, if Graham has his way, we will be working until we are 70 in order to receive our money. This is the ultimate application of socialist theory. They mandate that all workers (and employers) give a large percentage of their earnings to the government (on top of means tested income taxes). Then, they have the power to keep extending the retirement age at which we can receive our poorly invested capital. Furthermore, if the worker dies before he receives all or part of his money; the government eats the balance, thus denying his family the inheritance of the fruits of his labor. Finally, even after receiving his retirement money, it is ravaged by the means tested taxation. If this is not socialism; what is?
Liberals have always defended the constitutionality of Social Security by calling it an insurance program. Their willingness to means test the earnings incontrovertibly proves that Social Security is a gratuitous tax that is not covered under the 16th amendment.
The only conservative solution that is constitutional, fair, and economically prudent, is the gradual privatization of Social Security. Instead, we have Republicans (including those who endorsed the debt commission) who support the further nationalization of people's wealth under the guise of "entitlement reform". Imagine a situation in which Obama Care would go bankrupt in twenty years, and Republicans would then suggest that we pump more money into the unconstitutional program. Would we praise those 'reforms' as conservative entitlement solvency initiatives?
The objective is not to make a Democrat-run program solvent. Our objective vis-à-vis entitlement reform should be focused on returning the wealth to the American worker and tax payer by promoting more liberty and prosperity. Many conservative economists have suggested ways of achieving budget solvency through partial privatization. Liberals and many Republicans retort that there still would not be enough funds left to meet our obligations. Frankly, I don't care if this plan in itself would achieve solvency. We must honor our obligations to those who already paid into the system, and provide the younger generation with a way out of this socialist dead-end. If it turns out that we need another few hundred billion to pay out the remaining obligations, there is no lack of unconstitutional government programs and expenditures that we can and must cut in order to pay our obligations. Again, the objective should be to cut spending in order to oversee a phase-out of Social Security (as it is currently constituted), not to raise taxes to perpetuate this mandatory Ponzi scheme.
I have no problem with cutting down on Social Security benefits and making it more sustainable for those who choose to participate. But how can we compel every American to contribute a large percentage of their income to a plan that will be means tested and be administered at the mercy of corrupt politicians? This is purely unconstitutional and should be the next civil rights issue for young voters. We must demand that Republicans not sign onto the perpetuation and entrenchment of Social Security as a permanent form of involuntary servitude.
As we head into the 2012 Presidential election, we will be faced with a choice between candidates who are movement conservatives and those who are "Mr. Fix It technocrats" (in addition to the unambiguous RINOs). The former will always stand for life, liberty, and prosperity. The latter will be willing to sacrifice one of those sacrosanct ideals for the sake of bi-partisan solutions as an intrinsic goal in itself. The time is fast approaching for us to ascertain which prototype each candidate emblematizes.
Amen. In a sane world, Social Security would be phased out for younger (Gen-X and beyond) people. We should not have to pay a single red cent into a ponzi scheme which offers us no benefit.
I will opt out of receiving ANY payments from social security for the rest of my life if I can keep the 15% of my pay that goes to the government. And they can keep what they already took.
That is the only way to kill this beast.
Agreed, but on the condition those of us who've already contributed thousands over decades get what was taken returned to us.
Some youngsters around here resent having to pay a cent but think those who've contributed for years should take it in the throat.
I think they need to keep social security. For the simple reason that it provides a retirement income to those who either fail to plan or have their retirement wiped out through hard luck, economic distress, medical bills, etc.
The state/taxpayer picks up the tab for these people if there is not some kind of social security plan in place anyway. So I’m ok with a Federal minimum existence forced savings plan. I think it reduces the tax burden in the long run, by forcing workers to prepay for a minimal retirement.
But I think what they need to do is separate both the tax and the reporting along the lines of retirement, disability insurance premiums and indigent care.
The retirement funds should be treated like a retirement plan. Disability like an insurance plan. And people who have never paid into social security or exhausted their social security retirement fund under indigent care.
At least then we could clearly see where the money is going. And we could analyze it better.
“Flemming vs. Nestor” in SCOTUS 1960, upheld the termination of Social Security benefits to Nestor, who was deported because of his affiliation with the Communist Party, and upheld the right of Congress to change the benefits or contributions one makes to SS and declared contributions were not a contractual agreement in which the contributor has rights to his benefits. It is simply a general fund tax.
There was no “contribution”. FICA is just a tax with a different name. There is no real trust fund and never has been. The money you and I have paid in FICA is no different from payments of income tax...money in...money out.
I think we need to get rid of SS for the simple reason that politicians will always flush the money down the crapper.
Folks who fail to plan, are planning to fail. Forcing me to give money to politicians now for these failures is wrong. When the SHTF for these folks, the lock box will be empty and I'll be asked to pony up yet again.
What you are suggesting is charity for the stupid and unfortunate. I'm ok with that. But that's not what happens when you give money to politicians now expecting it to be there when needed later.
You need to find another vehicle for your charitable impulses than the government.
The sales pitch and unintended consequences.
Have I got a deal for you. You give me 7.5% of what you make, your employer will match that, if you work for yourself, you will give me 15% of what you make.
You will continue to give me this money on a regular basis for as long as you work.
I will start to give you back all the money you have saved if you live at least two years past your normal life expectancy. If you die before this time, I get to keep all the money I have collected from you over the years.
HOW THE H*LL THIS THIS CROCK PASS IN THE FIRST PLACE!!! If this had been the sales pitch, it would have never been enacted, now for the unintended consequence, we now live quite a few years longer than the life expectancy was in 1935.
You seem to think congress would borrow less if Social Security was investing elsewhere. They wouldn't. They would still borrow just from someone else.
If Social Security was privatized and completely out of the hands of the government, and if Social Security invested in the economy at large instead of US treasuries, the following would occur: Social Security would probably reap larger returns, but would also be more risky. Congress would still borrow and spend just as much as before, they'd just borrow from different lenders.
The problem isn't social security or even where social security invests. The problem isn't the Federal Reserve. The problem is Congress and a citizenry that is content to send shysters to Congress.
PS, You'd still be on the hook for disability and indigent care, so there would be a separate smaller tax. But if there were no Social Security, I believe it would be quite a bit bigger than it is now. More people would be in that category.
There is no such thing as a lockbox. The only thing more ridiculous than Al Gore claiming he would put the funds in a lock box was George Bush claiming he would do the same thing. Such a thing doesn't exist.
Oh, you could put dollar bills in a safe somewhere, but inflation would reduce their purchasing power.
You could buy commodities like gold, and put that in a safe. Of course Gold fell from $800 down to $100 in the 1980's. That's certainly not safe.
You can invest in the stock market, not safe. You can buy corporate bonds. But corporations spend the money as soon as they get it too. They don't just borrow money to sit on it. Again not safe.
The safest investment in the world is still considered to be U.S. treasuries. That's where Social Security invests.
A forced savings plan is not charity. Maybe it's not total freedom but it's not charity. And recognition that state responsibility for the indigent is a civil duty predates colonial times. So pick your poison... a higher tax for indigent care...or a forced savings plan that you benefit from and that keeps a lot of people from being on the indigent roles.
No new recipients, those who are on it now are the last. Contributions will continue to be made until the last of the current recipients expires.
That way we all share the pain.
Right now, we pay 15% for SS. 20% is considered enough to cover a decent pension in every economy in the world. So why does our 15% return so little that everybody here needs to have an additional 401K/pension? That's because the government throws the money away. And they always will.
Charity is not a valid government function. If the society is charitable, government efforts aren't needed. And if society isn't charitable, then a representative government won't be either, except hypocritically.
Forced saving into SS when they intend to make it means tested is indeed forced charity. Forced saving into SS when so much of it goes into SSI is forced charity. Or simple wealth distribution.
The status quo may be as you say, but it's not moral.
Life is risky, and you can't change that. Rather than invest in the promises of men to give me back colored slips of paper in the future, I prefer to invest in things. Gold still buys a suit of clothes, as it did in the Roman era. I have some silver quarters from 1962. They would buy a gallon of gas back then, and treated as bullion are worth a bit more than a gallon of gas today. But treated as coin of the realm, won't even buy one Snickers bar. Over 40 years, that's about 6.58% over 40 years, not too shabby, but just keeping up with inflation, and I'd lose money if I sold & paid taxes.
Getting rid of SS might not make the politicians spend less, but it might let me (and other responsible folk) save more. It'd certainly help my kids and grandkids.
Getting rid of this regressive tax is reason enough.
We pay 12.4% for Social Security on the first $106k and 2.9% on all income for Medicare.
What I don't know is how much of that 12.4% goes for indigent care and how much goes for disability insurance and how much is truly left for retirement. That's why I called for them to be taxed and reported separately. Without that split, I can't tell you how much is truly going into retirement and how much return you are getting. The return will be higher than it appears now, once the indigent care and disability premiums are separated.
"Charity is not a valid government function."
We'll have to disagree. I see a scriptural mandate for rulers to consider the cause of the poor and needy. In fact, scripture states that failure to to do so, will bring an end to your reign. That's something "We the People" need to consider if we wish to continue to rule. Both governments and individuals have scriptural mandates to be charitable.
Research the history of poor laws if you want to be educated on the State involvement in care for the indigent. It predates the colonial times. Our founding fathers considered it a civic duty, but it was left at the state level.
Again, if there is not a forced savings plan, you'll end up seeing more of your wealth redistributed to indigents than you will if there is.
"Treasuries are safe only in that you get back the $$ you are guaranteed, but those $$ aren't guaranteed to buy anything. "
Historically treasuries have provided a little more than the inflation rate. Right now it's not, but it's because we are in a depression. And it's a little scary because no one knows if the Federal Reserve is going to be able to successfully unwind QE without undo inflation.
Your comparing gold to the dollar. But treasuries do pay interest. Investing in treasuries over time would have typically outperformed gold, because of the compounding interest. Right now gold is in a speculative bubble, but compare returns to 4 years ago, and I believe you'll find treasuries outperform over a long period.
Hear are the yields on 10 year treasuries 1960 - 4%, 1970 7%, 1980 11%, 1990 8%, 2000 6%
Source of yields
That means $10000 invested in treasuries i 1960 and reinvested every 10 years would be worth $341,000 today. ($14,802 in 1970, $29,118 in 1980, 82,680, in 1990, 190,412, in 2000, and 341000 in 2010).
Compared to gold: Gold cost $35.27 in 1960 So $10,000 would have bought 283 oz. That gold today at $1376 would be worth $390,133. A little better than the treasuries. But in 2004, when gold was only $400 those 283 oz would be worth only $113,410. Treasuries were much safer and outperformed in more years than the gold was.
I’d rather phase it out, but at very least, the retirment age should float annually to ensure annual solvency. If times are hard, or there’s a baby bust, some may need to work a few months longer than they planned.
Then, let the greedy geezers vote to cut SSI, means test, or whatever, so they can have an earlier retirement.
If you don’t like this plan, conside that it virtually guarantees against tax increases, and also ensures that those who are funding your retirement will be guaranteed to enjoy the same benefits.
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