Posted on 09/29/2011 4:48:24 PM PDT by Kaslin
Election '12: Herman Cain's victory in Florida's straw poll is notable, among other things, for his advocacy of "Chilean Model" Social Security reform in a state filled with retirees. It ought to be a wake-up call to all candidates.
Aside from the insta-analysis about Cain's victory being a protest vote against Texas Gov. Rick Perry, it's worth noticing that — in Florida, no less — both Cain and Perry, who finished first and second in the weekend's GOP straw poll, were the two most outspoken candidates about confronting the U.S. crisis in Social Security.
It completely ends the notion that addressing the issue of unfunded pension liabilities — in Social Security, Medicaid and Medicare — is the third rail of politics.
Voters migrated from Perry to Cain, but there were multiple Tea Party favorites to choose from. In moving to Cain, they went from a moderate to a strong stance on Social Security reform.
Perry did call for a national dialogue on the matter. But Cain went much further, at least three times in debates calling for "The Chilean Model" to replace Social Security, bringing the idea to as many as 15 million viewers.
Chile's system, enacted in 1981, took government out of the pension business altogether and replaced it with a system of personal retirement accounts.
It's one of most successful fiscal reforms in history.
It outperforms Social Security on returns, yielding about 9.23% compounded annual returns over 30 years under private management.
(Excerpt) Read more at investors.com ...
It will be interesting to see if Romney now goes around Florida scaring folks about Cain’s Chilean Model like he did about Perry’s Ponzi scheme.
It Works!! Jose Pinera and Luis Escobab Cerda set up a good thing!
What I really want, is a group of sharp and fair critics who can probe Herman Cain’s 9-9-9 economic and jobs plan for flaws as well as to quiz him on how he plans to implement the Chilean model in the USA for solving Social Security’s imminent Demographic problems.
This article by Kevin Williamson is a good start :
http://www.nationalreview.com/articles/278668/nein-nein-nein-kevin-d-williamson
I’m sure Herman Cain has good responses to Williamson’s critique.
Maybe we can ask Kevin Williamson to sit down on a one on one with Cain.
He would crush Hussein and deliver a super majority GOP Congress.
Oh, and adios Boehner.
Bush talked non-stop about the Chilian model, he also recommended help for the younger ones and brought up Galveston. They lynched him.
Go Herman!
I remember that, and there were also Freepers who ridiculed him for it
Want.
I just talked to Escobar. (At almost 84 he still skis 40-50 days a season and plays tennis 3 or 4 days a week.) At the end of Jan 2011 there was $140 Billion USD under managerment. It’s about 143 Billion today. 60% of Chile’s has 16 Million people are covered.
The Chilean Social Security System just turned 30 this year.
It is SOLVENT and THRIVING ( unlike ours ).
Here is a very brief explanation of the Chilean Model for those who want to be educated:
_______________________________________________________________________________________
EXCERPT:
Instead of paying a 12.4% Social Security tax as we do here, Chilean workers must pay in 10% of their wages (they can send up to 20%) to one of several conservatively managed and regulated pension funds. From the accumulated savings, they get a life annuity or make programmed withdrawals (inheriting any funds left over).
Over the last three decades these accounts have averaged annual returns of 9.23% above inflation. By contrast, U.S. Social Security pays a 1% to 2% (theoretical) return, and even less for new workers.
Long-Term Boom
History shows that pension funds prudently invested in a diversified portfolio appreciate significantly over long periods of consistent saving. In 1981, the Dow industrials stood at 900; today, despite three market crashes, it’s nearly 13,000.
In 2005, New York Times reporter John Tierney worked out his own Social Security contributions on the Chilean model and found that his privatized pension would have been $53,000 a year plus a one-time payout of $223,000. The same contributions paid into Social Security would have paid him $18,000.
The system is doable here, but does require citizen education and political resolve.
First, implicit debts must be made explicit, which most politicians abhor.
Chile decided to compensate workers for money already paid into the system, through “recognition bonds.” It financed this via bonds, partial diversions of existing pension taxes, sales of state assets and spending cuts.
Its road was made even easier as economic growth from a system that encourages work, saving and responsibility filled government coffers with new streams of tax revenue.
In the U.S., Social Security already is in bad shape. It’s already paying out more in benefits than it gets in payroll tax revenue.
This is an excellent analysis. Spot on, too.
Seems to me that what is shaping up now is that Cain, albeit in his Happy Warrior way, is going to take out Perry and Santorum is going to take out Romney.
Leaving a Cain/Santorum, Santorum/Cain top tier going into the mid-stretch.
Gingrich will make a solid splash with his new contract and his ideas, a couple of which are late-to-the-dance-but-better-late-than-never Cain-like proposals. But Gingrich’s basic instincts, such as hiring an “Inclusion Director,” will continue to ooze out and subtly turn voters off.
My story right now and I’m sticking to it.
Maybe, maybe not. I think they're jumping to conclusions without some idea of the demographics of those who voted in the straw poll. SS might not have been a top concern of those who voted.
And I don't recall much being said during he debates about Medicaid and Medicare.
That was not a good move by Romney.
And after all the wonderful contributions seniors made to the truly organic rising up of the Tea Party movement, it was just a tad stupid and a whole lot condescending to go around blathering about how seniors were (still) easily manipulated by "scary" soundbites, etc.
Seniors are a HUGE part of the soldierly contingent that has risen up to SAVE OUR COUNTRY!
Mitt just doesn't quite get it.
E.g.,
I hope Cain is studying up because he just may end up in the top tier and his proposals will be scrutinized more. This will give him the chance to really step up his game.
I noticed Gingrich is coming out with a flat tax type proposal, too. This just reinforces that Cain’s political and business instincts on the need for massive tax reform are dead on.
The times, they are a-changin’.
Don’t argue numbers with a math major who also has a minor in physics.
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