Posted on 05/08/2005 9:26:31 AM PDT by Whatnow
I think its time to think out side the box. Most of the old ways we did social security will no longer work. We need to make it for the people by the people.
We need a page so anyone can post no more than three things at a time they would like to be put into a new (Social Security Bill).
Here are three I would like to see.
1- Any person may deposit at any time any amount (minimum $25.00) into any account, must give name, social security number, date of birth, of person. Any deposit is to be tax free. Deposits may be made at any Post Office, Bank, or Credit Union.
2- Each person with and account may name any number of beneficiary's to his account. Any funds in his or her account at death shell go to his or her beneficiary's account's to be used at there retirement age.
3- 50% of any law enforcement drug money should go to the social security general fund.
I would like to see congressmen on the same system as the rest of us.
My brother-in-law is an OKC fireman. They are opted out as well. It makes their life much easier.
It would be very simple to fix social security. Pass a law requiring everyone to contribute 5% of their income to a Roth IRA. Then if SS benefits are cut, or even if it goes bust, no big deal.
Social Security should be replaced by a requirement that employers pay half the cost of a variable annuity purchased from a private insurance company. A variable annuity is like a life insurance policy with a cash value, where the policy owner chooses how to allocate the cash value among some set of mutual funds (very much like most 401k plans.) All such policies would have to provide a US Treasury Bond/Note/Bill mutual fund as one of the investment options (to duplicate the risk-level of the current system.)
The original Social Security system should be frozen in place, with benefits reduced by an amount strictly proportional to the amount of time remaining until the individual would have been eligible to collect full benefits under current law (so that those already retired see no change to their benefits.) The FICA tax should be reduced so that only the amount necessary to fund next year's benefits is collected, until the last beneficiary under the old system dies.
The lates trustees report for SS shows that the excess of money paid into the system vs. what is required to be paid out of the system over the next ten years is 2.2 trillion (yes trillion) dollars. What will happen to that money? Every dime will be spent on current government by representatives that WE send to Washington. I suggest that the practice be immediately stopped and the 2.2 trillion be actually save in an actual trust fund.
http://www.ssa.gov/OACT/TR/
We know money taken this week is gone this week towards 'programs' ... but ... what programs?
Are they all bad?
Which ones are good? (I'm sure the shorter list).
Anyway, I have no problem funding truly needed programs, which is what taxes were supposed to take care of, but I do not want to fund pork or redundancy or invented needs.
Given all of that, take the money from my check and put it into any interest bearing activity.
.I suggest that the practice be immediately stopped and the 2.2 trillion be actually save in an actual trust fund.
Better idea is to kill the dumb idea of a trust fund that is restricted to government debt as its vehicle of saving.
Put those trust money's in the ownership of individuals to receive benefits in the future in the form of personal retirement accounts.
Get the money out of government's hands, as govenment spends it no matter what in the form of financing govenment debt instruments, and the alternative of giving govenment control of business sector through corporate bonds and stock purchasing is not the way to go at all. That would just lead us all the faster into a defacto socialist political system as well as a socialist fiscal policy.
The way out of the morass is one way only, and that is a path that turns the responsibility for retirment back into the hands of the individual citizen and the private sector. Government in the retirement/insurance business is a socialist dead end no matter how it appears to be on the surface as long as it is government in control and ownership of so-called "trust funds".
In my view, any reform of the Social Security system must ultimately lead to government getting of the retirement business.
Yes, that's the only way to "fix" it!
Here's my contribution to the mix:
Fixing Social Security: Final Solution - The Three Essentials for Success
Copernicus ^ | 5-1-2005 | John Meehan
Posted on 05/03/2005 9:32:58 AM EDT by Matchett-PI
http://www.freerepublic.com/focus/f-bloggers/1395801/posts
Increasingly, the public perceives the certainty of the President's promise to reduce benefits in exchange for the uncertainty of future returns from private investments.
Weekly, we read of new complicated solutions, grasping at impossible straws. All looks dangerous, complicated, expensive, discriminatory, and bleak. It is time to consider strong new ideas to reverse the ebbing trend of opinion and turn it to enthusiastic acceptance.
What has been missing and is now imperative are these three definitive features: 1) clear, vigorous assertion and incontrovertible proof of the true munificence of stock returns and their surprising lack of risk entailed; 2) inviolable private ownership of assets, and 3) government guarantee of a financial safety net for minumum benefits, and early disability or death of those with dependents.
President Bush in his May 2, 2001 appointment of the bipartisan Commission "to study and report specific recommendations to preserve Social Security for seniors while building wealth for younger Americans," and in his accompanying guidelines, more or less included the three features, of necessity indirectly, generally, and broadly. Now, more specificity and trenchancy is needed.
Logic Says Start Over
The mess and complexity, along with the inherited politicization of the wealth-redistribution aspects of Social Security, locked the Commission into a losing box from the outset. If some visionary member were to have said, "What if there were no existing program? What would we recommend if our mandate is to design a brand new system for maximum retirement benefits for all workers and their families at little or no cost to the government, starting next year?"
Your first step would be to identify those investments with the highest returns and the least risks. The return part is easy. Stocks are the clear-cut answer. Risk is trickier, but malleable. The widespread opinion is that stocks are far too risky for use in pension funds, especially one sponsored by the archon of legislative probity, the U.S, Congress. It is important to define the meaning of risk in stocks. Simply, it is the possibility that their prices will be lower, sometimes a lot lower, than what was paid for them, most dangerously at a time when the owner wishes to sell and cash out.
The other side of the coin is that stocks may be higher, a lot higher, and cash out at the time of retirement can mean wealth, possibly great wealth. Thus investors face the beast of volatility which shakes them periodically with alternative paroxysms of exuberance and despair. Not the kind of behavior to be encountered at a time when most hope to enter what will be the tranquil years of their retirement.
Yet time itself soothes this beast. The longer confronted, the tamer it becomes to accommodate our purposes. For example, 93 times out of a 100, it will double stock-invested pension money. One hundred percent of the time since 1870, it has returned at least 333% of stock-invested pension money at retirement age. These figures are derived from publicly available data and prices.
Results like this make it easy to legislate a government guarantee for a minimum benefits-level based on 130 years of U.S. financial history. The nearby chart - linked from here - shows the dollar returns on pension investments for every year since the first decade of the last century. For simplicity and easy application to real-world numbers, $1 is invested annually every year for 40 years (a desirable working span in a lifetime). The total cumulated investment is $40. At the end of each 40th year, the chart shows what the total investment is worth. Thus, in 1974 (a below-average year), a retiring worker would have a stock portfolio worth $421 after a total cumulative investment of $40, yielding a return of more than a 1000%.
Translating this chart example to modern times, last year's median wage earner made $32,800. Over the next 40 years, taxes for retirement at 12.4% of wages will total $300,000, assuming 3% wage inflation. At the end, his or her private account will be worth $3,200,000, using the 1974 example, a below-average year. The account can then be converted to an annuity or allowed to continue intact with an annual selected percent-benefit distribution.
The government will be able to act as guarantor of investment performance (or contract the job out to the private-sector) based on the statistical probabilities inherent in the experience to date since 1870. A floor and ceiling can be set, say, at 25% and 1500% returns respectively ($50 and $600 on the chart). The guarantee would make good on any returns less than the floor. The excess of returns above the ceiling would go to the government as collector of premiums to build reserves. Beyond a certain level of reserves, refunds can be distributed to all workers participating in the plan, or the floor or ceiling levels may be adjusted, or funds may be used to meet other safety-net needs--those related to early disability or premature deaths leaving dependent children. Since 1870, the floor has never been reached. The ceiling has been exceeded 40% of the time. Those are superb odds for the government which harvests each excess.
The Burden of Proof for Private Accounts
Finally, the burden should be on the opposition to prove why these pension-savings accounts should not be the personal private property of each worker in the United States. The President said in his May 2001 Rose Garden announcement, "Personal savings accounts will transform Social Security from a government IOU into personal property and real assets; property that workers will own in their own names and that they can pass along to their children. Ownership, independence, access to wealth should not be the privilege of a few. They're the hope of every American, and we must make them the foundation of Social Security." Democrats and liberals should pay special heed to this essential feature of the optimum government-legislated pension plan. Paradoxically, it can and will establish one of the biggest social wealth-redistribution plans afoot in the United States since the origination and growth of the federal income-tax code. Further, the lower down the social-economic scale the worker labors and lives, the greater will be the financial benefits that accrue to him or her and their families.
The old system should be allowed to run out completely, paying all promises on the books now. Borrow if necessary to complete the process. In the new plan, safety-net benefits related to disability or early death leaving dependent children behind should be funded by borrowing in the credit markets until sufficient reserves and actuarial experience accrue. Until then, a moderate premium charge against contributions may be levied to build reserves and amortize specific related debt. This provision of the new law must have a biennial sunset feature by which it expires automatically unless extended by new legislation. Safety-net benefits may be set at some fixed multiple of median wages or average annual consumer spending.
The President's pussyfooting on the amount of stocks to be voluntarily allowed is inappropriate. Up to 100% (less a minor premium for safety-net reserves) should be permitted. The program is voluntary. Why restrict the freedom of choice of the owners? Especially when the odds are so favorable--for everybody, but specially those at lowest wages--and the specified retirement benefits are guaranteed for all participants. ~
Milton Friedman called the previous article upon which this one is based "fascinating and the conclusion suggested by (the) calculations striking. . . a very informative set of calculations." Click here and here (contains the backup data for the first article) for Complete Previous Article with sources, notes, and tables that underlie the historic examples used here.
Note. If you agree that what you have read here is reasonable (based on the historic record since 1910), then write to your U.S. Senator, Representative, and the President at once. Send an email to each telling them that you actively support their sponsorship of this solution in what they may want to call the "Employee Retirement Wealth Ownership Act of 2006." And get your voting friends and neighbors support the bill too. Select and copy the URL of this page in the address-bar window above and paste it into your message.
"In my view, any reform of the Social Security system must ultimately lead to government getting of the retirement business." ~ ancient_geezer
See: http://www.freerepublic.com/focus/news/1399039/posts?page=12#12
Of course it's a better idea but it will never happen. Look at all the uproar over just 4% private accounts. My daughter has incredibly stupid peers at her high school who parrot what their liberal parents say and they are raising cain about private accounts. Go figure.
Politicians will never trust us with our own money. They would lose to much control over us.
The biggest problem right now is that the Congress is using the excess SS funds collected to make the deficit appear smaller, rather than "putting them aside" for when they are needed.
The first best step that could be taken to "save" Social Security is to balance the budget, but neither Congress nor the President seems interested in doing that.
That said, I wouldn't mind being able to put my money into an IRA or 401K instead of SS, but I suspect if given the option of contributing to SS, investing on their own, or spending the money immediately, those who will need SS the most in the long run would opt for the 3rd choice.
Politicians will never trust us with our own money.
Then it high time to get us an new bunch in office.
It doesn't take large percentages of voters to swing local elections. Committed groups can do a great deal in assuring the right folks get in. That is a lesson clearly demonstrated by liberals over many decades of democrat power politics.
It is time conservatives learn the lessons of how to play the game. It starts local at the precinct level, and getting involved in the caucus and primary level when even small groups have tremendous leverage over who runs and who doesn't.
Even a national level, far less than 1% committed and well place group of the electorate can completely overturn the results of a presidential election, as a review of the 2004 election results clearly indicate.
It is time to consider what conservatives can do with that knowledge rather than bitch about how them politicians just push there own agendas.
One things for certain, sitting back on bemoaning the way of things is not going to do the job.
Conditions are never just right. People who delay action until all factors are favorable do nothing.
William Feather"The only thing necessary for the triumph of evil is for good men to do nothing."
--Edmund Burke (1729-1797)"The penalty good men pay for indifference to public affairs is to be ruled by evil men."
- Plato -The condition upon which God hath given liberty to man is eternal vigilance; which condition if he break, servitude is at once the consequence of his crime and the punishment of his guilt."
-John Philpot Curran: Speech upon the Right of Election, 1790.
The first best step that could be taken to "save" Social Security is to balance the budget, but neither Congress nor the President seems interested in doing that.
For good reason, the monetary/banking system is underwritten by government debt instruments.
With out deficits maintaining the fiat money supply in step with population growth and demand for credit on which the current consumption based economic bubble is running would collapse the financial system into a deflationary which scares the bejeebas out of Keynesian economists who love inflation for its capacity to erode the value of debt dollars allowing cheap payback on the back of the nation's creditors.
Monetary inflation is just a backdoor way of taxing the American people by depreciating the purchasing power of dollars held in savings stage to maintain a spendit as fast as you can mindset and promote the inevitability of dependance on government largess promoting further government growth.
I think they should repeal it and start over...better yet, just repeal it.
ping
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.