Posted on 03/07/2005 9:24:05 AM PST by Cagey
WASHINGTON (AP) - A leading Republican senator is proposing to raise the Social Security retirement age from 67 to 68, while Democrats maintain their opposition to the president's plan to overhaul the retirement program with private investment accounts.
Nebraska Sen. Chuck Hagel's plan would raise the age that retirees could receive full benefits, beginning in 2023. "We are living longer," Hagel said Sunday on CBS'"Face the Nation.""So when you look at the total universe of this, I think that makes some sense to extend the age."
But some leading Democrats said they could not support Hagel's plan because he would pay for private accounts by borrowing and increasing the nation's deficit. Sen. Edward M. Kennedy, D-Mass., told ABC's "This Week" that would be "a great threat to seniors" because it would raise interest rates.
President Bush plans to travel across the country this week as part of his 60-day push to persuade a skeptical public to support personal retirement accounts. The president's plan would allow workers under age 55 to divert up to 4 percentage points of their Social Security taxes into private stock and bond investment accounts in exchange for lower guaranteed future benefits.
White House counselor Dan Bartlett said that while polls show most Americans don't like the idea, most of the opposition is coming from people over 55 who won't be affected by it. He said on "Fox News Sunday" that Bush will try to reassure those older Americans that their benefits won't change.
Bartlett said the White House wants to work with Democrats, but Democrats are vowing to fight unless the president is willing to change his plan to divert Social Security funds into private accounts.
"If the president takes privatization off, if he makes a commitment to the future of Social Security, we're ready to sit down on a bipartisan basis and put everything on the table," Sen. Dick Durbin, D-Ill., said on NBC's "Meet the Press.""That's the only way to start a good-faith negotiation."
Democrats also object to the president's call for personal accounts because they would not make Social Security solvent. Treasury Secretary John Snow, appearing on ABC, maintained the personal accounts still must be part of the solution.
"They don't in and of themselves bring those lines together," he said. "But we'll never get a fair and equitable solution to the Social Security problem unless personal accounts are an integral part of the solution."
Hagel's plan, which he said is the first Social Security reform bill being introduced in the Senate this year, would allow workers 45 and younger to keep their guaranteed Social Security account, but set up a voluntary program of personal accounts that could supplement their retirement income.
"The president has not laid down a specific plan as to how he's going to get us to solvency," Hagel said. "I do that. It doesn't mean mine's best, but I do it."
Bartlett indicated the president may consider raising the amount of income that is taxed to fund Social Security above the current $90,000 per person. "He says the only thing that's off the table is raising the rate" at which income is taxed, Bartlett said on CNN's "Late Edition."
Also on Sunday, House Democratic Leader Nancy Pelosi said on Fox that because of Federal Reserve Chairman Alan Greenspan's support of personal accounts, some people "have seriously questioned the independence of the Fed." She declined to say whether she would describe Greenspan as a "political hack," as Senate Democratic Leader Harry Reid did last week.
Other Democrats distanced themselves from Reid's comment. Sen. Joe Lieberman, D-Conn., said on CNN that Greenspan is "sometimes very mistaken," but he is an "above-average human." Durbin said he has disagreements with Greenspan, but that calling him a political hack "may have been slightly too strong."
Then SAVE for it. No one says you have to wait until your 68 to retire. You have to wait until then to collect from the gummint.
NOT EVERYONE PAID THE SAME RATE.
I'M SICK AND TIRED OF HAVING MY FICA RAISED TO BUY VOTES OF GREEDY GEEZERS WHO MAY HAVE PAID " FOR MANY YEARS" BUT WHOSE TOTAL PAYMENTS WERE LESS THAN I PAID IN 10.
I would be in favor of means testing if that meant only those who are "poor" (by conservatives' definition) got ss benefits. However, I do not believe that that will ever happen. I think working class people and even middle class people who never saved any money would be spared, while middle class people who lived frugally would get screwed. I understand that there is no "trust fund", that social security is basically a Ponzi scheme. Your proposal makes sense (means test, with substantial cuts in taxes). If I believed the part about cuts in taxes really would happen, I'd go for the means test.
Bump to every single thing you said.
Note that the best solution to being forced to chip in for this is just to leave. You can work outside the U.S. and you don't contribute to the U.S. tax base (at least for the first 70K of income) and you don't pay into Social Security. That means you don't collect much, later, but what Gen X or Millenial Gen member thinks they'll collect anything, anyway?
Tax Ted Kennedy's trust fund to support Social Security.
Well they can find less labor intesive jobs, how many people you know over 60 doing that kind of work?
Also lets just go on and raise the retirement age to 80, that should solve the problem.
"As far as I know its the same age that you're eligible for Social Security."
Ouch! I better get to doing some down and dirty research. If that is the case, essentially any legislated SS age increase for the eligibility of SS benefits, is a legislated increase in the age at which my own investments become available to me.
Looks like I need to research this further and change my investments accordingly.
A caller on Rush made what I thought was a very astute comment regarding Social security and change.
He was I think responding to an earlier caller advocating indexing the the FICa tax similarly to the way COLA is indexed. The second caller said that the retirement or benefits age should be indexed rather than the rate.
That is if 65 were the retirement age based on say a 70 year life expectancy in 1933 then the benefits age should be pushed forward in the same indexed manner to say 83-6 or 7 years to 76 or 77.
It was a good, rational thought.
Yea but 70 is a long time. Who knows if I will live that long - all these heart attack/high blood pressure inducing presidential elections!!! ;-)
People in general aren't living longer in a healthy state. They're propped up by advances in medical science, but not necessarily robust enought to keep working.
Thank You.
With a Roth IRA you can retire at 59 1/2, and withdraw the principal (but not earnings) five years after investment. 401k's and 403b's can both be rolled over into regular IRA's and then into Roth's, so you can retire whenever you want. I don't know the ages for 401k's and 403b's but I think you can retire early as long as setup a fixed monthly withdrawal between retirement age and age 65. With the Roth option you can avoid being locked in.
If you see taxes are going to start going to go up because of aging baby boomers, it's to your advantage to go to a Roth and bite the taxes now.
If it looks like a national sales tax is going to be implemented, then people with Roths are going to get screwed.
The biggest problem for early retirement is figuring out how to pay for medical insurance. Now is the time to get into a high-deductible HSA plan and start putting away money into an HSA.
Not accurate. Everyone who worked paid the same rate as everyone else who worked at that same time. And I (I'm 55 next week) damn well have paid plenty of taxes at the 12.4% rate, just like everyone else who works now does.
No doubt those who paid in at 3% during their working years and retired in 1975 (just in time to scarf up on the cola's) made out like bandits.
But the fact still remains, everyone who works, pays SS taxes period. EVERYONE should get a haircut, not just us ants.
To clarify above. If you can live only on the principal from your investments in a Roth, you can retire at age 20 if you want. You only need to wait until 5 years after the investment was made to withdraw it.
He's jockeying for position in 08. I wish the republicans would put up someone better to run against him for the sentate. I vote for him because there isn't a rat I will vote for.
Very good. I'm 29 and followed a similar strategy. Even though I started investing in aggressive funds right before the bubble burst, thanks to dollar cost averaging I'm still ahead. I intend to retire well before my "official" retirement age and don't plan on collecting a dime from SS. My fear about these "reform" discussions is that we'll end up with an increase in the payroll tax, in exchange for useless "add-on" accounts.
Which is why planning for retirement can be a nightmare. Who knows what stupid rule will get past in 10-15 years that negates everything you've done? As some other posters have alluded to, I worry that at some point the politicians will decide that it's not fair that I saved a bunch in my 401(k) and IRA's while others didn't and decide to go after my accumulated savings.
Why are you folks so anxious to give Washington even more power to pick winners and losers?
I'm willing to look at any solution that treats everybody equally. I'm not going to go for yet another transfer that rewards the screwups and screws those of us who played by the rules.
If you're going to sell your means-testing proposal, you're going to have to do a much better job of justifying it than just telling us we've been fooled all along by the promises. That justifies nothing and I take strong issue with the premise anyway.
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