Posted on 12/11/2024 8:22:52 AM PST by NorthernDancer
When Social Security was established, it was intended to be a self-funding system from the employer and employee contributions. This self-funding is why Social Security is not an entitlement. The fund is, instead, a horribly managed defined benefit pension plan — horribly managed by legislation, not by negligence.
The advent of DOGE (the Department of Government Efficiency) has provided the mechanism, impetus, and political will to challenge the status quo.
Concerns about the solvency of the Social Security System have been bandied about for decades. Solutions have, unfortunately, focused on increasing the Social Security tax rates, increasing retirement age, increasing taxability of benefits, and in some extreme cases making Social Security benefits “needs”-based.
No one has discussed the elephant in the room, which is the manner in which the funds are invested.
… For full implementation of the change, Social Security trustees would be permitted to invest in investments typically allowable in financial markets with the caveat that all shares would be non-voting to preclude government interference. The investment criteria would exclude certain countries as designated by Congress from time to time.
Fund investments would be permitted in ETFs, mutual funds, guaranteed insurance products of a portfolio mix, and the like
(Excerpt) Read more at americanthinker.com ...
Perhaps DOGE can end Social Security’s Perverse Financial Incentive for the Government to kill 65+ year olds?
Wrong. It's the very definition of an entitlement, even more so under the original intention. I don't understand why so many conservatives don't understand this simple concept.
However, IMHO the best solution would be to allow anyone who wants to, to opt out of SS. People who put into it could still get their checks. And if you opt out in part of your working life, you'll get lower checks in retirement (in exchange for keeping more of your paycheck during your working years).
“The fund is, instead, a horribly managed defined benefit pension plan — horribly managed by legislation, not by negligence.”
DOGE can do nothing without legislation.
Government can’t take care of everyone over 62/65, thus they came up with this social program. The only fix now is to privatize it slowly beginning with those entering the workforce.
SS is getting a 2.5% increase to account for inflation, are all federal employees, department budgets, and federal pensions, etc, all using that same inflation rate that SS uses?
There are no funds to invest. Everything brought in by the Social Security tax and then some is sent to the retirees. For a couple decades a little more was brought in than needed, but the rest of government immediately spent it like a cow being skeletonized by piranhas, leaving behind an "I Owe Me" in the infamous lockbox. But we have been spending that in the past few years. This just means that Social Security can dip into the general fund without explicit Congressional approval since we are just repaying the bonds to SS. Soon that will run out too, so any overspending will have to be explicitly approved.
If there are any plans to change SS to an investment based system, then payments into it will have to be raised enough to pay for the full current system and then raised again for the new investments.
correct me if I am wrong but the SSI pot was raided by these puke politicians, left an IOU and it was added to the gdp
Up until today, I've been using https://id.me to log into my SSA account. I opened a login.gov account and associated it with my SSA account as a preventative measure. I've also alerted my retired friends to this FUD message.
Could this be a prelude to SSA laying off staff, referring people to their web site to get answers to their questions? Of course, that assumes you can FIND the answers there -- is there any feedback from the telephone agents so that the site can be updated with FAQs? (I doubt it.)
Low payment, and now "modern" customer support. Sounds like trouble for seniors everywhere.
I suspect the main reason for it is they seem to be understaffed. I’ve had to call them a couple times and 30 minutes on hold seems to be the norm.
SS is the classic example of why government should never have access to any pool of funds that is set aside for future liabilities. Washington politicians evidently consider it their primary obligation to spend, spend, spend. The mere thought of cutting back or reorganizing for efficiencies sake is anathema. It’s always more, more, more. If there is a temporary emergency the first place they look is some pool of money they can rob. Paying it back is seldom if ever done.
Social Security was also a Trusted Fund which means the money was only to be used for Social Security. Then Congress passed a law letting them borrow from the fund for other purposes. Needlesstosay they keep borrowing and never pay back the fund.
Social security was NOT designed like a defined benefit pension plan.
It was a “pay as you go” plan from the start. 65 was chosen as the retirement age because few people lived much past that age and current contributions were enough to fund current benefit payments.
People living longer has wreaked havoc with that design, which was not a good idea even then.
I think there is a lot they can do without legislation.
I believe there is a lot of that money flowing to people who aren’t supposed to be getting it, in little sums and really big sums.
“I believe there is a lot of that money flowing to people who aren’t supposed to be getting it”
You are talking about Social Security money??
I think the only place in the payments for Social Security where there is a lot of fraud is in the Social Security disability claims. They suddenly skyrocketed during Obama’s term and I don’t know if the rates of accepted claims have come down or not. I do not think there is a ton of fraud in the regular benefits, because, unlike the disablity portion, the eligibility, request and approval is pretty straight forward.
I go the other way on this. I think that SS should be abolished for folks entering the workforce.
Allowing SS to enter the stock market would be the worst thing for business n this country. It would allow the government to “pick” winners. It would give the administrators incredible power.
With the advent of 401(k)s, the administrators of those plans can walk into a company and pretty much dictate what the expected performance should be over the next year. Usually this is done without even understanding the company, its operations, or current constraints impacting growth. I’ve been in those meetings. It’s more of a blackmail session than an “analysts meeting.”
Imagine introducing a government bureaucrat into that environment.
No…a return to company pensions would be the best thing. But, then governments could not steal our money and buy their own toys.
SS is the classic example of why government should never have access to any pool of funds that is set aside for future liabilities.
Somehow I remember that the union pension funds did this rob-the-funds thing first. The old joke: "but the pension money was just sitting there!!"
Where to park the collected funds is another question, for another thread. I do have some thoughts on that.
You could easily require the SS fund managers to invest in only mutual funds, across many asset classes, and no more than x% in one asset class (i.e. tech, or energy).
No…a return to company pensions would be the best thing. But, then governments could not steal our money and buy their own toys.
A better idea would be for each of us free American citizens to manage our own retirement. I'd hate for my financial future to be managed by the company store (typed in my best Tennessee Ernie Ford voice). Nor do I want my finances managed by lying, broke, corrupt government (i.e. SS). How about neither the govt nor the employer take from the worker's paycheck money to be managed for the worker's future and let the worker keep that money and do with it what he wants.
We have tons of churches now teaching financial small groups for free. It's easy to learn how to budget, save, and invest. Even if it's just a simple portfolio like one S&P 500 index fund to get started, later you can learn how to diversify it out (I suggest 30+ equities mutual finds while working, then another 15 or so bond, treasury, money market funds during retirement).
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