Posted on 02/10/2021 4:47:00 AM PST by Kaslin
A recent Reuters headline read, "Yellen, Rice tout economics as key to fixing American inequality."
According to Susan Rice, President Joe Biden's new domestic policy adviser, "The evidence is clear, investing in equity is good for economic growth."
Our new Treasury secretary, Janet Yellen, says, "I believe economic policy can be a potent tool to improve society. We can -- and should -- use it to address inequality, racism ..."
I couldn't agree more.
According to the Federal Reserve's most recent Survey of Consumer Finances, the median wealth of white families is $188,200, compared with $24,100 for Black families.
To the extent that change in government policy can lift the median wealth of Black families, I am for it. The good news is there is such an opportunity.
I have been writing about it for many years. We should give working Americans the option to opt out of Social Security and use the taxes they are paying into it to invest in their own personally owned retirement account.
We'll achieve more racial equity by allowing low-income Americans the opportunity to have more equity in -- ownership of -- America.
A big reason for the huge wealth gap between white and Black families is the huge gap in ownership of equities -- stock -- between white and Black families.
According to the Pew Research Center, 61% of white families have either direct or indirect ownership in stocks. Only 31% of Black families do.
Per the Federal Reserve, among white Americans ages 35 to 54, 65% have at least one retirement account. Among Blacks in this age range, only 44% do.
It is true that median Black household income is also lower than median white household income, meaning Blacks on average have less to save and invest. Which is why giving the option to opt out of Social Security is so vitally important.
Every working American pays 12.4% of their income to Social Security, half taken out of their paycheck and half paid by their employer.
This is a tax, not an investment. The government then uses this tax revenue to recycle and make payments to those currently retired, who themselves paid taxes during their working life.
The Committee to Unleash Prosperity, working with the nonpartisan Tax Foundation, recently calculated what working families at different income levels would have earned at retirement if they could have invested their payroll tax rather than paying into Social Security.
For instance, a low-income couple who started working in 1971 and retired in 2015, where one earner earned 45% of the national median income and the other 25%, would have gotten an annual Social Security benefit of $21,035. If that same couple could have invested 10% of their paychecks in a stock fund over the same period, using actual historic data for this 45-year period, they would have had $738,360 at retirement that could produce $40,610 annual income for them -- almost double what they would get from Social Security.
They would also have the benefits of ownership. They could bequeath what remains to their heirs.
Per the Federal Reserve, 29.9% of white Americans say they have benefited from inheritance or some other family gift. Only 10.1% of Black Americans say they have received an inheritance or family gift.
If Black Americans do not feel part of and invested in the nation, as they should, one reason is that they are disenfranchised by the same government that claims it wants to help.
So, Secretary Yellen, policy adviser Rice, how about getting on board with me? How about showing Black Americans, and all Americans, that you really want to level the playing field?
The Social Security Trustees report that by 2034, the system will have insufficient funds to meet obligations.
Ownership, rather than more government, is the answer.
Now we just need courageous leadership.
>Personally I believe investing in the Stock market has to do a lot with luck
It does if you don’t do any kind of analysis. I’ve been keen on analysis the last 3 months and made 100% my investment during that time.
The Left says: "You will own nothing. And you will be happy. Or else."
Opt out of Social Security? Hell no! Our useless congress critters forced us into this system by force of tax law. There was no option to opt out. I suspect like most of you, I started having Social Security and Medicare taxes taken out of my paycheck starting in high school. I want the promised benefits. If there are budget issues, quit funding foreign aid to most nations.
Is this not a veiled suggestion for the Social Security Administration to lessen the individual payment, for those of us who are retired and have only the SScheck each month?
Th lottery or publishers clearing house have just one winner out of millions. Over the years if done on the long term almost everyone who invests in the stock market comes out ahead. Your earnings can be increased by careful study and investing. I fail to see how the stock market compares to the lottery but particularly in the days of zero interest rate if you want your investment to grow there are not many other options
The way for Texans to ‘opt out’ of Social Security is to also opt out of the United States. But fat chance of that happening, as the same GOP as exists in DC runs our state.
I noticed either Star or Townhall has adopted the NYT style book recommendation of capitalizing the word “black” while correctly leaving the word “white” in lower case. So they agree “black” is a person’s name and not merely an adjective.
“If Black Americans do not feel part of and invested in the nation, as they should, one reason is that they are disenfranchised by the same government that claims it wants to help.”
I’m sure many black Americans felt part of and invested in this nation when they voted for Trump last year yet were disenfranchised by various government agencies as well as officials.
“A big reason for the huge wealth gap between white and Black families is the huge gap in ownership of equities — stock — between white and Black families.”
Those disparities need more elaboration statistically
in the form of single parent and two parent numbers in
my opinion. Those numbers have been obviously and dynamically moved by the failure of the Great Society.
The sand shifting is there.
“Yellen, Rice tout economics as key to fixing American inequality.”
Translation: “We are going to get the ‘right’ braying about tax cuts and free trade again while we open the floodgates of 3rd World immigration advance the LGBTQ agenda, and start wars. Again.”
Inequality is because some are stupid and others are smart.
There are several towns in Texas who were able to opt out of SS. They had money taken out of their wages and instead of it going to SS and getting a pittance each month, they are going to retire with $$$$$$$.
Means testing, or discriminating against Whitey?
True, but Reagan closed off that option in 1986, when he signed ‘Social Security Reform’, which was to PERMANENTLY fix Social Security (LOL).
I even have a relative who NEVER signed into Social Security. When he was young, his parents saw the writing on the wall, and refused to register him, and then he picked it up from there. But that is very, very, rare...and now you have to sign up your newborns, if you want the tax ‘benefits’ of having kids.
Because as everyone knows, people earning 45% and 25% of the national income have 10% of their earnings available to invest and the know-how to invest it. What proof does Ms. Starr have that if you do away with the FICA tax then people will save instead of spend?
A big reason for the huge wealth gap between white and Black families is the huge gap in math and language skills as a result of unionized public school systems in the cities.
Urban public schools were terrible when my parents extracted me more than 60 years ago, because I wasn't learning the basics, and they are terrible today. Even more so today, but mainly for the Black and Hispanic people who still live in the cities.
As economist Milton Friedman once said, the largest racist influence in the US is the government, specifically the public school systems.
Studies of “wealth” don’t typically include the “net present value” of any defined-benefit pension, while including people’s 401K assets. This presents a skewed view of wealth.
A disproportionate number of blacks work for government and are eligible for pensions.
“If that same couple could have invested 10% of their paychecks in a stock fund over the same period”
The problem is, how many would? SS is like a forced savings account. Leaving it up to people to invest voluntarily wouldn’t work. There would end up being fewer people with any retirement income at all.
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