Posted on 01/08/2008 5:58:42 PM PST by Vigilanteman
The first of the Baby Boomers filed for retirement benefits starting January 1, 2008. Millions more will follow in the near future. The system is set to collapse without either a massive increase in taxes, a massive reduction in benefits or a combination of the two.
Everyone knows this, but nobody wants to do anything about it-- at least not openly. Some politicians feel we may buy a little more time by flooding the country with illegal immigrants who, it is hoped, will pay taxes but not stick around to collect benefits. This is, at best, wishful thinking since, as their numbers grow, so does their political and economic clout. If there are any taking their earnings, going home and starting new businesses in their home countries, those numbers are greatly exceeded by the new ones coming here, legally, illegally and by birthright citizenship.
A more likely scenario is that the influx of poorly educated low wage earners will bring the entire system to its day of reckoning sooner rather than later as their tax contributions will be nowhere near the benefit entitlements their massive numbers and political power will demand.
But there is an effective and low-cost solution. It is likely to be popular with most of the American public except for a relatively small but powerful interest group-- Government workers. Has anyone noticed that when the economy does well, we need to hire more government workers to oversee and manage the growth. When the economy stagnates, we need to hire more government workers to cope with the stagnation. And when the economy dives, we still need to hire more government workers to deal with the crisises brought about by a recession. Businesses may add or cut people depending on the cyclical needs of a business. But the government, particularly at the national level, will always add more employees no matter what. If the Democrats control Washington, they'll add them faster. If the Republicans control Washington, they'll add them slower. But they will always add them.
Since those who collect social security represent a net drain on the treasury as do those who work for the government, why not combine the two? Certainly, the people who paid in to social security feel like they are entitled to collect on their contributions, but the fact is that most of their "contributions" went to pay a previous beneficiary, so there is nothing to pay them except new money from new taxpayers . . . and there simply aren't enough new taxpayers coming into the system to keep it solvent unless, as we all know, there are massive tax increases, massive benefit reductions or a combination of the two.
How likely are politicians to agree on such a solution? The government employee unions such as SEIU would naturally object. So would the heads of the government fiefdoms. But their is a carrot as well. Read on.
With the exception of law enforcement and military functions, are there any government jobs which older Americans couldn't do? Think hard. Whether justified or not, most criticisms of older workers pretty much parallel criticisms of government workers-- slow, bureaucratic, more concerned with procedures than results, afraid of new technology and not adaptable being among the most common.
Would any efficiency really be lost by replacing government workers with older workers? More than likely, efficiency would improve because most of the older workers would come with experience in the private sector where they expect results. The initial deal influx of older workers would be simple enough-- any older worker who foregos social security would get a year-on-year income replacement with a government job. All new government workers (except for very limited exceptions such as law enforcement or military where youth and agility is an absolute neccessity) would have to be hired from the pool of older workers willing to make the trade: no social security in return for a government job or even a combination such as 40% reduction in social security in return for a two day a week government job. This would be the only way to grow the government workforce. The government unions realize they may actually have more potential pockets to pick for union dues, albeit with some of those not likely to be receptive.
But how would such a workforce be recruited since the boomers would be entitled to social security anyway? Well, that's the beauty of the plan. Every year a boomer works is a year of social security saved is a year closer to the day the boomer dies and collects nothing. Plus there are boomers who are patriotic, deeply patriotic. For every boomer who did drugs, protested and/or engaged in promiscuious sex, there is another who lived seriously, served their country or and/or raised great kids. A patriotic appeal (We need your experience for our country) as well an economic incentive (you'll make a lot more as a government worker than collecting social security) would be more than enough to recruit volunteers.
The bigger problem would be creating the openings necessary to absorb all the volunteers. This would be the next phase of the wildly successful program to get as many older Americans as possible off social security.
This is also where the political resistence would get severe. Yet, compared to the impending bankruptcy of the social security program or the alternative of severe taxation of the remaining working population, such resistence would not be insurmountable. There would be a mandatory retirement for government workers at age 40. The process could be phased in and announced in advance to give those workers time to look for alternatives in the private sector. They could be reminded that by retiring now, they would have experience and pay grade classifications to get a leg up on another government job assignment in another 22 years or so.
Star performers might get a year by year extension of their mandatory retirement date. Poor performers, perhaps the lowest quintile of each group, could be retired starting at age 35. This is not a novel concept to those who have worked in the competitive environment of the private sector.
With adjustments of the key inputs (mandatory retirements at age 40, performance based retirements starting at age 35, availability of new program volunteers and demand for more government workers), the entire social security program could be stabalized until a real long-term solution could be enacted such as privatization.
This is only the start of the program benefits. Government workers and private sector workers would no longer work in parallel universes. There would be a sense of shared fate. Government workers just might be reluctant to wreck businesses in the private sector by knowing they would be expected to find a job there mid career. Private businesses might think twice about putting an older worker out to pasture considering they might come back as a government auditor to visit them.
The biggest benefit, however, might very will be a whole generation entering the workforce who wouldn't view a government job as a lifetime entitlement. That, and as the baby boom generation passes into history we might, for once, actually be able to shrink the every growing size of the government.
Could one (or more) of the presidential candidates please steal this idea as their own?
Another option to safe Social Security is to legalize mandatory euthanasia for baby boomer liberals.
In the abstract, it’s not a bad idea. However, it’s clearly not feasible.
The three solutions are:
Gradually continue to increase the retirement age
Double the earnings limit
Modestly increase FICA taxes
None of these are permanent fixes, but they will keep things solvent until a permanent fix can be installed.
Analysis by a post-Boomer, judging from the spelling...
As I’m 64 with no plans to retire or collect yet, I think I can say this.
My generation and the boomers younger don’t deserve SS. We squandered the Social Security Surplus. Starting in the 60s under LBJ until now in 2008 we have consistently paid enough into SS to keep it solvent. But we demanded immediate gratification and using SS money to ease our guilt feelings about the poor, Blacks, seniors older than us and worst of all, drug and alcohol abusers and malingerers on SSI. SS is bankrupt because of us. We do not deserve it to be baled out. We have no ethical or moral basis to demand that our grandchildren (or immigrants or anyone else) to pay for our own mistakes. We should reap what we sowed.
Being one that did the sex, drugs and rock n' roll ... but grew up before killing myself ... I think I like your idea.
I will study this.
I plan on working til I am 70 or 72. I plan on living with one of the children and have told them that the house and property goes to the one who cares for me. They are interested.
Somebody better start breeding fast, because I plan on getting my checks starting at the end of the year. I’ve put over $100 grand into this Ponzi scheme and want some of it back.
“I’ve put over $100 grand into this Ponzi scheme and want some of it back.”
You will likely get SOME of it back.
Two of your suggestions involve large tax increases. They will be permanent tax increases. The conservative approach is to privatize the system. Allow people out of the system if they forfeit benefits. Provide incentives for people to work by eliminating payroll taxes and reducing benefits.
You insult Mr. Ponzi!
That would be an understatement.
This does not have a chance of ever even getting scheduled for a vote.
The US Government is the largest employer in the nation. They have an almost unstoppable lobby in Congress.
Ever notice when the government runs out of money and the government workers get laid off when they come back they get paid for the time they were off. That’s power at the polls in motion baby.
Morally, you are correct, at least insofar as you are addressing the boomers who engaged in this squander.
Politically, however, you know they won't reap what they sowed; they'll push it off on the next generation.
This is why the outlined plan is more humane and more politically possible.
Morally, you are correct, at least insofar as you are addressing the boomers who engaged in this squander.
Politically, however, you know they won't reap what they sowed; they'll push it off on the next generation.
This is why the outlined plan is more humane and more politically possible.
The vast majority of America does not work for the government. Just bringing this up would highlight a division we need to highlight sooner rather than later-- one America which pays the taxes and one America which consumes them.
The America which consumes the taxes should not be living better than the America which pays the taxes. What will happen to the former when the later decides they've had enough?
Fundamentally, the system must renege on promises it made to people when it took their money, take money from other people with no reasonable likelihood of repayment, or do some of both. Privatizing the system might reduce the amount of money that gets looted in future, but won't solve the fundamental problem that the government borrowed money from some people and gave it away to others.
The third proposal said “modest increase in FICA taxes,” not a large one. And privatising the system doesn’t have enough support, though it has more than 20 years ago.
Speak for yourself, Bob. I didn’t approve of ANY of those give away programs you list. We should be demanding the same funding of “pension” liabilities on the part of government at all levels which is required of private companies, and legislators who approve benefit levels without proper funding should be in prison (with their own generous pensions cut off).
Easy, make the Senate and House politicians a part of retirement that the rest of the taxpayers are under. It would get fixed PDQ!
The vast majority of America doesn’t vote either, while government workers vote in larger numbers than the population at large.
I agree with everything you say but political reality is what it is. Ask any elected politician they will readily admit they are not about to buck the Government employees union.
Just think about it, if you threaten government workers jobs they are going to turn out at the polls in record numbers. Do you think the supporters of this plan will turn out in similar numbers? I doubt that congressmen are going to bet their jobs on it.
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