Greenspan warns against deficits (says to cut social security)

CNN ^ | 02/24/04

[hoosierboy]

NEW YORK (CNN/Money) - Federal Reserve Chairman Alan Greenspan warned Congress Wednesday to take quick action to fix the nation's swollen budget deficit, saying it could impair the ability to pay Social Security benefits and weigh on the broader economy.

[Lady Composer]

ping

[templar]

Even if he agrees with Greenspan, he needs to "set up a commission" to study this proposal. The commission's study period should end some time after November 2nd.

You're suggesting that Bush needs to deceive the people and avoid facing real issues to get reelected?

Politicians of every sort and party have been doing that for a long time now, that's why we have the problem. The day of reconing is bearing down on us like a freight train and we'd better think about stopping it now while (if) there is time or getting off the tracks before it hits us full force. Things aren't going to be nice either way, but there will be the opportunity for the Elite and those who attach themselves to their coattails to gain tremendous wealth and power that would not otherwise be obtainable.

[templar]

Like private investment of SS taxes not coming out of your check.

SS taxes are used to fund daily government operating costs, they don't go into a bank account somewhere waiting to be used for future benefit payments. Private retirement programs will not result in getting rid of this tax, it is needed to fund the government. That's why the coming baby boomer retirement is such a problem, it takes funding away from the general revenues and uses them for SS payments instead of government operating costs.

We are running our country on borrowed money, and the bills have to be paid somehow, someday. Credit card financing of one's lifestyle only works for so long, then it collapses taking the lifestyle with it.

[Geezerette]

And personally, I'd like to see them add means testing to those who remain on the plan.

Amen Dittos!!

g

[Faithfull]

Add means testing? You sound like the liberals- IF the Govt. does means testing, then those who are responsible and are saving for retirement will end up paying for those who are not saving but are often driving new cars, taking vacations on credit, etc.. What would be the point of being responsible and planning for retirement if SS is means tested. Some work two jobs just to manage saving for the future and you want to penalize them? I am stunned at the greed and hypocrisy. You must be a SS recipient and not one saving or worrying about the future.

[DannyTN]

"Privatization is the answer."

I don't agree that privatization is the answer. That will just add an additional layer of bureacracy, just like the Medicare HMO plans.

The answer is to change it from a guaranteed benefit that is based on your last few years working to a cash value benefit program, that pays out based on a set amortization schedule. Just like the corporate world has already done by abandoning defined benefit pension plans and going to 401k's.

The problem right now is that the system uses current tax receipts to pay beneficiaries, instead of invested funds. That's got to be stopped, because everytime the ratio of workers to beneficiaries changes people are going to be scared the system will bankrupt.

If by privatization you mean the investment into riskier investments that pay a higher return than Treasuries, I'm against that. Yes the return could be higher, but who is going to bail out the people who lose their funds? They would fall back onto the government's shoulders.

[anniegetyourgun]

Who bails folks out on private investments now?

[DannyTN]

"Who bails folks out on private investments now?"

The government. Understand, they don't replace your investments, but if you become destitute you go on various welfare programs, food stamps, medicaid, etc.

That's why social security should remain in relatively risk free investments. The only reason for a government enforced savings program like SSA is to keep people from becoming destitute and dependent on the government. And then individual's private investments should make up the difference in quality of life.

But it should be run like a savings program and not a transfer program.

[SierraWasp]

What he says may very well be true in light of the baby bulge coming. Trouble is... He's feeding the disparaging Democrats at exactly the wrong time!

Do the Dems control whatever committee he's been "testifying" in front of? Is this designed by Dems to get more grist for their "Disparage America" agenda???

[anniegetyourgun]

The discussion of welfare is another thread. However, I have no argument with the concept that individual accounts have risk thresholds.

[Methos8]

That's why social security should remain in relatively risk free investments. The only reason for a government enforced savings program like SSA is to keep people from becoming destitute and dependent on the government. And then individual's private investments should make up the difference in quality of life. But it should be run like a savings program and not a transfer program.

Well once social security switches to a savings-account based program, I think anyone who would like to opt-out of the retirement-based portions (leaving disability and other things aside for the moment) should be allowed to.

Im an accounting/financial professional who doesn't need the government to tell me what I should and shouldn't be investing in. Im more than capable of evaluating my own financial risk on my own without big brother's help.

[BOBTHENAILER]

Is this designed by Dems to get more grist for their "Disparage America" agenda???
When I watched his testimony, I immediately thought just that. Great minds think alike.

[Brownie74]

I'll bet you a dollar to a donut that there will be more illegal aliens coming into America than there will be baby boomers going on Social Security.

And lets not forget the most important thing - our government wants to pay them what?

If you said Social Security you get an "A" and move to the head of the class.

It's time to change the oil in Washington.

[DannyTN]

"Well once social security switches to a savings-account based program, I think anyone who would like to opt-out of the retirement-based portions (leaving disability and other things aside for the moment) should be allowed to."

I disagree. It should be a forced savings program, a cash value program, where the value of the benefit is tied to the value of the cash contributions plus earnings. People should NOT be able to opt out. And they should only be able to withdraw funds at a rate that doesn't exceed their life expectancy.

Even finance professionals like us can be wiped out and end up dependent on the government, due to a variety of causes, from business and economic turmoil to catastrophic illness in the family. But the fact is if you eliminated SSA, Medicaid and Welfare would balloon. And guess who would pay? We would. In my opinion, responsible people benefit more from having a program like SSA in place for everyone, than the irresponsible people do. Because SSA by it's enforced nature holds the irresponsible to a minimum level of responsibility.

[searchandrecovery]

It took a lot of courage for Al to say this - he knew what kind of booshy he'd incite, but he did it anyway. I don't like the g-(spam)-man (f'in globalist), but I respect him for having the k's to say this (the entitlement that has no name).

On the other hand, hey al, i just pay-pal'd ya a-- $1 - go buy some more printing presses. Also, make all future generations pay for my retirement - you owe me, dude. Mo money, mo money (fo me). like i'm gonna work one mo year than i hafta - not! Shee-ooot, i'll just go on welfare for coupla years, comp me some foody-stamps - everyone else does. word.

[humptydumpty]

you stated -
(You could also provide greater incentives against early retirement, or even shift the retirement age up one year. )

So how do you propose to do for for those of us who are in the 56 - 64 year age brackets whose jobs have been sent overseas ( over 3 million of us ) with no chance of re employment? ( except mabey at Burger King). We did NOT want to retire or stop work at all nor be foreced to take any reduction in our 30-40+ years of earned benefits.Perhaps you can answer that !! No - dont ask my kids and grandkids to make up the difference.!