Posted on 03/09/2011 5:53:51 AM PST by reaganaut1
America's fiscal need for entitlement reform is pushing the discussion about Social Security inexorably toward "means testing," a policy both the left and the right have long avoided. Both sides realize that means testing, namely reducing or eliminating payments from the program to higher income senior citizens, would recast Social Security from its current perception by citizens as a retirement program to one of outright redistribution or welfare.
Many Americans see Social Security as a savings plan, albeit a coerced one, and a recent poll by the AARP (which certainly knows how to write poll questions geared to suggest as much approval for the program as possible) shows wide support for Social Security with equally wide skepticism about the program's future.
The fact that it's seen as a savings plan, that it has been seen as such for at least a generation despite two Supreme Court rulings that Social Security payroll taxes are not savings, not investment, not insurance, indeed not anything other than another tax levied by government, suggests that means testing in any substantial way will require jumping a substantial political hurdle.
The hurdle has been lowered by the fiscal debacle created under this president and the last one, leaving a substantial subset of both parties ready to attempt to clear it. This despite the political risk implied by AARP's poll question asking whether respondents agree with the statement that "Everyone who pays into Social Security should receive it, no matter what other income they have." According to AARP's results, 83% of Americans agree and "belief in this idea is high regardless of income, age, or gender."
America has dipped its toe into de facto means testing by making Social Security benefits partially taxable, beginning with the 1983 Social Security Amendments
(Excerpt) Read more at spectator.org ...
That’s one I could certainly get behind. How much would that help, I wonder? I suppose it would mostly apply to rich old ladies who have outlived anything they had put in.
WARNING - It sounds as if you pay taxes. The content of this link has caused suicidal / homicidal urges in other taxpayers that have seen it. Avoid having sharp objects or deadly weapons nearby.
You may want to put your “barf bag” away (or at least read the link you provided).
http://www.factcheck.org/2009/10/the-obama-phone/
Q: Has the Obama administration started a program to use “taxpayer money” to give free cell phones to welfare recipients?
A: No. Low-income households have been eligible for discounted telephone service for more than a decade. But the program is funded by telecom companies, not by taxes, and the president has nothing to do with it.
Once you turn it into a means tested program, the public will demand that it be a voluntary program.
Once you turn it into a means tested program, the public will demand that it be a voluntary program.
This is certainly one of the most volatile issues going.
Even on FR you can see the wide range of strong opinions.
In my wildest dreams I see Democrats getting “payback” from the voters for the decades long fraud of SS and Medicare. But I know it will never happen.
The bottom line is at some point soon the debt game will be over, interest rates will take off, and the US will have to meet its fate.
You do realize that SS is a flat tax and you are advocating replacing it with a graduated income tax. Graduated income tax is at the heart of our fiscal insanity and your are recommending that our dependence on it increase.
You are right that we have to be careful about suggesting people who get Social Security and Medicare are freeloading like a welfare recipient. That is not true and no one should suggest that a Social Security recipient is the same as a welfare recipient. However, Social Security is not a savings account either. It is a transfer payment. People are not simply accessing an account that has money in it. Social Security recipients’ money will come from tax payments by current taxpayers. That is where the perception problem is—current recipients or people who have paid into the system for years get angry that they there is a suggestion that they not get full benefits that they “paid for.” Unfortunately, it is the nature of any Ponzi scheme that someone is left holding the bag and that someone is us.
That number would be around 1 million dollars in todays money.
At least means testing would finally lift the veil off of the scam, and show that Social Security is nothing but another wealth transfer tax, just like any other tax.
A perfect illustration of why government programs never get fixed. SS is indeed a pile of crap. However, your recommendation for fixing it is to take that pile of crap and pitch it on top of a bigger pile of crap, because then we'll be able to eliminate it. Makes sense to me.
In point of fact SS is not a savings program. The only way to maintain that position is to insist that the officers are imprisoned for malfeasance and establishing a PONZI scheme.
The solution is a simple one. All shall have established a personal account with the actual money invested plus an appropriate interest rate, compounded. All participants shall be allowed to transfer their investment into a private portfolio with the same conditions as any retirement account.
Because the account will have face value up to the point of disbursement via annuity payout with lifetime guarantee, minor surviving children will have an account with face value, heirs will have survivor benefits, and insurance will provide disability benefits. In short, the entire program can be privatized with a net benefit to the gov given the fact that the ponzi scheme is now bankrupt.
That's the problem. They can't. There is no money to give back to you or anyone else unless it comes from current taxes. We are all victims of a government Ponzi scheme. Benefits will be cut for people who paid SS taxes all their lives or else taxes on the current taxpayers will go up astronomically.
Pick an age, be it 35 or 40 and anyone OVER that stays in the system while anyone UNDER that age is removed and responsible for their own retirement plan via IRA, 401 etc, Anything those removed from SS have contributed will remain theirs and will be collected by them at retirement in the form of a diminished pmt which will be supplemented by their own IRA or 401.
Just exempt my pre-tax 401k contributions up to the amount SS “owes” me (including the employer contribution) and we’ll call it square. That would encourage more retirement savings and still bring in income to the program. Then I don’t get the shaft on taxes when I retire and the morons that don’t save for retirement can live off SS.
That means disabusing people of the notion that a)it's a pension/retirement plan and b) that "their" contributions are put away somewhere. In short, we need to get people to let go of the damn thing.
But like any PONZI scheme, no one is going to volunteer to be the last one out. So it will have to collapse. You think that's better than diminishing it?
I agree with means testing - as long as the payroll deduction goes down once we all accept that fact
Exactly.
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