Life expectancy was 61.7 years when Social Security was passed in 1937 !

[Deleted member 499399]

Cost to the employer goes up. He then has a few choices. Raise the price of his goods substantially, reduce the size of his staff.. Either way,, this is a loose loose for the employees, as sure they work less for more money, but the cost of everything, life, is now higher as well, and a good chunk of them are now unemployed.

Sure, emotionally your idea sounds nice, but reality dictates it wont work.

Cost does not go up if technology increases production. It's simply a matter of sharing some of the gains with the workers.
For example if a worker makes 10 sprockets during an 8hr shift and technological advances double production, the employer can pay the same daily salary for a 4 hour shift at no loss. Or the employee can work 6 hours and the split the gains with the business.

 

[Kframe]

Cost does not go up if technology increases production. It's simply a matter of sharing some of the gains with the workers.
For example if a worker makes 10 sprockets during an 8hr shift and technological advances double production, the employer can pay the same daily salary for a 4 hour shift at no loss. Or the employee can work 6 hours and the split the gains with the business.

Except you and I both know that is not how it works, or will ever work. EVER. Sure, if advances means you can now make 20 widgets is an hour instead of 10 you an now theoretically work half the time and make the same 10 widgets. Except, you and I both know that the employer will want those 20 widgets, as they are more profit. So NO ONE will get half shifts, they will still be stuck in their full shifts, now making 20 widgets instead of 10..

Literally, profit motive means this vision of yours will never happen. I mean, you have to look at it realistically, it just wont happen ever.

 

[Deleted member 499399]

Except you and I both know that is not how it works, or will ever work. EVER. Sure, if advances means you can now make 20 widgets is an hour instead of 10 you an now theoretically work half the time and make the same 10 widgets. Except, you and I both know that the employer will want those 20 widgets, as they are more profit. So NO ONE will get half shifts, they will still be stuck in their full shifts, now making 20 widgets instead of 10..

Literally, profit motive means this vision of yours will never happen. I mean, you have to look at it realistically, it just wont happen ever.

of course they won't do it by choice. This is where legislation comes in.

 

[evansusmc2]

I plan to retire by 55. And I don't expect big daddy government to take care of my personal responsibilities that most people today don't.

55? How so? You been paying into a long term retirement fund for many years?

I myself am on schedule to retire at 39. But thats due to doing 20 years in the US Military.

 

[PEB]

If only the government pays back the 1.35 trillion surplus that was funded for the war in iraq and tax cuts for the rich, then you can bring up rehauling social security

It's amazing how many forget under President Bush own numbers they used 714 billion out of Social Security to fund and handle the tax cuts during the wars. We're about to do something similar with President Trumps efforts to cut corporate tax rate to 15 percent.

Paul Ryan himself proposed large cuts in Medicare and raising the Social Security retirement age had a hard time trying to figure out how to pay for Trumps massive overhaul of the Corporate tax rate.

The effort was applauded on Wall Street but most companies are not planning on repatriating the money they have overseas.

Companies like Apple, Exxon and Google have massive operations overseas and have little interest in changing it.

 

[Deleted member 159002]

that is what trump is trying to do with lowering the corp rate. he wants that money to come back.

Are you being serious? What makes you think that if financiers have extra money, they'll use it for defined benefit pensions for their employees?

 

[Jack V Savage]

Care to explain?

He's going into construction.

Seriously, I hope he's joking.

Anyway, we had a major reform of SS in 1983 that accounted for the baby boom that increased the payroll tax (so that there was an annual surplus invested in bonds for the expected time that current payments would not be sufficient to cover annual payouts), made a very gradual increase in the age for benefits, etc. It was a really big deal at the time and details on it are still available online. It's really odd how it seems to have been memory holed.

Good chart but I would just at look at age 65 to how much longer we get benefits now than when the program started. Definitely living longer than when the program started. 6 years more.

This is the right way to think about the issue, but the bar we should use to compare is what we thought the life expectancy would be in the future in 1983 when reforms were made rather than what it actually was in 1937.

is anyone here under the age of 45 seriously planning on being dependent on SS by the time they retire?

I'm not planning to be "dependent on it" because the payout isn't that much, but I am 100% expecting to get it.

Social Security has always been a scam. Let people invest that money instead.

Assuming people actually did invest the money, the only difference that would make is a more uneven distribution of payouts--with some people doing very well and more people being completely fucked.

 

[JudoThrowFiasco]

He's going into construction.

Seriously, I hope he's joking.

Anyway, we had a major reform of SS in 1983 that accounted for the baby boom that increased the payroll tax (so that there was an annual surplus invested in bonds for the expected time that current payments would not be sufficient to cover annual payouts), made a very gradual increase in the age for benefits, etc. It was a really big deal at the time and details on it are still available online. It's really odd how it seems to have been memory holed.



This is the right way to think about the issue, but the bar we should use to compare is what we thought the life expectancy would be in the future in 1983 when reforms were made rather than what it actually was in 1937.



I'm not planning to be "dependent on it" because the payout isn't that much, but I am 100% expecting to get it.



Assuming people actually did invest the money, the only difference that would make is a more uneven distribution of payouts--with some people doing very well and more people being completely fucked.

Well, they are going to need to come up with a reform in the next 7 years because the the disability and and old age trusts are on deck to be tapped into.

So, yeah -- you''ll get -- but at around 72% of the current pay out.

But, you always seem very optimistic that they will come up with a reform; i dont share that view.

You would do much better if they let you keep that X% of the 100+k they deduct from your and your wifes pay and let you two invest it.

 

[Jack V Savage]

Well, they are going to need to come up with a reform in the next 7 years because the the disability and and old age trusts are on deck to be tapped into.

They're designed to be tapped into. The whole point of a surplus was that there was going to be a bulge in payouts so people put in more than the payouts for a time, and then the account is drawn down later. There was a small miscalculation (mostly related to increased inequality, I think), but fixing it is not really that big a deal.

But, you always seem very optimistic that they will come up with a reform; i dont share that view.

You would do much better if they let you keep that X% of the 100+k they deduct from your and your wifes pay and let you two invest it.

SS is an extremely popular program, and a fix of some type is very easy. So, yeah, I expect it to be solved. If nothing else, just making payments from the general fund will fix it. The shortfall is less than 1% of GDP. And my own situation isn't the issue. We do max out our 401k contributions and have investments beyond that. Again, my expectation is for SS to be supplementary. And note that people actually get more than they pay in, and it's rock-solid safe and inflation-adjusted (actually, the adjustments overstate inflation so benefits grow). The growth isn't great, but that's a nice thing to have as part of your overall package for retirement.

Who is really supposed to benefit from cutting SS benefits? As I've pointed out before, if future old people as a unit pay in the same amount in terms of investments and later receive the same level of payouts, it's a total wash for non-old-people, while for old people, the change would be slightly more rich people and a lot more destitute people. Why is that a good change? If future old people collectively pay in less and later get less, that benefits non-old people, but then you have a lot more destitute old people and probably some younger people would be paying directly to take care of their family members--again, a lumpier distribution that benefits a few people and really hurts a lot. If people collectively make good investments, that means that non-old people are losing a bigger share of their money.

 

[JudoThrowFiasco]

They're designed to be tapped into. The whole point of a surplus was that there was going to be a bulge in payouts so people put in more than the payouts for a time, and then the account is drawn down later. There was a small miscalculation (mostly related to increased inequality, I think), but fixing it is not really that big a deal.



SS is an extremely popular program, and a fix of some type is very easy. So, yeah, I expect it to be solved. If nothing else, just making payments from the general fund will fix it. The shortfall is less than 1% of GDP. And my own situation isn't the issue. We do max out our 401k contributions and have investments beyond that. Again, my expectation is for SS to be supplementary. And note that people actually get more than they pay in, and it's rock-solid safe and inflation-adjusted (actually, the adjustments overstate inflation so benefits grow). The growth isn't great, but that's a nice thing to have as part of your overall package for retirement.

Who is really supposed to benefit from cutting SS benefits? As I've pointed out before, if future old people as a unit pay in the same amount in terms of investments and later receive the same level of payouts, it's a total wash for non-old-people, while for old people, the change would be slightly more rich people and a lot more destitute people. Why is that a good change? If future old people collectively pay in less and later get less, that benefits non-old people, but then you have a lot more destitute old people and probably some younger people would be paying directly to take care of their family members--again, a lumpier distribution that benefits a few people and really hurts a lot. If people collectively make good investments, that means that non-old people are losing a bigger share of their money.

No, i get your point on the collective good. Just pointing out i have seen any side of the isle come out and talk about saving the disability trust or talk about how after 2019 -- cost of program is going to outweigh revenue from taxation. As of right now, you will be getting a significantly lower payout than people currently get.

But, as an individualist, i much rather my tax revenue to be returned and to have control of how i invest that money.

 

[Jack V Savage]

No, i get your point on the collective good. Just pointing out i have seen any side of the isle come out and talk about saving the disability trust or talk about how after 2019 -- cost of program is going to outweigh revenue from taxation. As of right now, you will be getting a significantly lower payout than people currently get.

Again, we have a surplus because it was expected that there would be a period where payouts exceeded revenue on an annual basis. So we'll soon start tapping into the surplus, but that's not a problem at all.

 

[JudoThrowFiasco]

Again, we have a surplus because it was expected that there would be a period where payouts exceeded revenue on an annual basis. So we'll soon start tapping into the surplus, but that's not a problem at all.

Point me in the direction of a solid article that explains how it is not a problem. Everything i am reading is suggesting it is. Not sure how a program that cost more than it brings in is not a problem -- what happens when the surplus are tapped by 2033 and nothing gets done?

 

[Jack V Savage]

Point me in the direction of a solid article that explains how it is not a problem. Everything i am reading is suggesting it is.

I'm telling you. In 1983, the system was reformed to take funding issues into account, and the solution was to create a big surplus that can be drawn down later. Think it through. Why would you want a surplus if you never intend to draw it down?

 

[JudoThrowFiasco]

I'm telling you. In 1983, the system was reformed to take funding issues into account, and the solution was to create a big surplus that can be drawn down later. Think it through. Why would you want a surplus if you never intend to draw it down?

I understand, but after 2033 when that surplus is gone, and the program cost more than it brings in -- how is that a good thing?

 

[Jack V Savage]

I understand, but after 2033 when that surplus is gone, and the program cost more than it brings in -- how is that a good thing?

Obviously, it's not good to have the surplus run out. I'd agree that we have to slow the decline in the surplus to make it last past the baby boom. The point is that we have a lot of time to make up a very small funding gap. A quarter of a percent increase in revenue relative to GDP directed toward that purpose would overshoot the problem, and there's a lot of political pressure to make it happen.

 

[JudoThrowFiasco]

Obviously, it's not good to have the surplus run out. I'd agree that we have to slow the decline in the surplus to make it last past the baby boom. The point is that we have a lot of time to make up a very small funding gap. A quarter of a percent increase in revenue relative to GDP directed toward that purpose would overshoot the problem, and there's a lot of political pressure to make it happen.

Then aside from the collectivist vs individualist approach, i dont know what we are debating here. I simply said as of now, you're projected to cash out less than what people currently do and that i have not seen a push from either side of the aisle to address the tapping of the surplus. Obviously it was designed to be used.

 

[Jack V Savage]

Then aside from the collectivist vs individualist approach, i dont know what we are debating here. I simply said as of now, you're projected to cash out less than what people currently do and that i have not seen a push from either side of the aisle to address the tapping of the surplus. Obviously it was designed to be used.

I responded to this:

"is anyone here under the age of 45 seriously planning on being dependent on SS by the time they retire?"

I have a strong expectation that SS will be paying out the same level (or more, when you account for the inaccurate inflation adjustment) when I retire.

And "collectivist" vs. "individualist" isn't the right framework for this. Both approaches are equally collectivist. It's just that one allows for a lumpier, luck-driven distribution.

 

[JudoThrowFiasco]

I responded to this:

"is anyone here under the age of 45 seriously planning on being dependent on SS by the time they retire?"

I have a strong expectation that SS will be paying out the same level (or more, when you account for the inaccurate inflation adjustment) when I retire.

And "collectivist" vs. "individualist" isn't the right framework for this. Both approaches are equally collectivist. It's just that one allows for a lumpier, luck-driven distribution.

And i dont share your optimism -- either the contribution ceiling is going to get raised, the age gets increased or the x factor of automation changes the program entirely. But, im not seeing any hard push plan to address the gap.

Also, how is an opt out choice not an individualist approach? Allowing the individual to control their income that otherwise would be taxed into the program.

 

[Jack V Savage]

And i dont share your optimism -- either the contribution ceiling is going to get raised, the age gets increased or the x factor of automation changes the program entirely. But, im not seeing any hard push plan to address the gap.

There's not a hard push because there's so little pressure. A very small tax increase sometime in the next 20 years is what's needed (the earlier, the smaller, but it's small all the way).

Also, how is an opt out choice not an individualist approach? Allowing the individual to control their income that otherwise would be taxed into the program.

Well, first of all, an "opt-out choice" is just designed to give political cover for ending a hugely popular program. SS is not workable with it. The actual choice is having SS or not having it. Secondly, in both cases, we're making collective decisions about how to distribute resources to people who are not working (of course, we also make collective decisions about how to distribute resources to workers and business operators). We're just deciding whether we want a lumpier, more chance-driven distribution or a flatter, reliable one. Some people prefer to enter a pool where they have a chance to get lucky and a greater chance to bust and others prefer to enter a less-volatile one.

 

[ImNotSurpisedDonks!]

Yeah but wars and infant mortality was a huge part too. I heard some stat that if you took away infant mortality and wars, people used to live longer owing to a way healthier diet, lack of obesity and the fact that people were so much physically active. For example, the oldest woman in England has had a glass of sherry and a glob of butter every day she wakes up, since like the 1920's or something, and any doctor would tell you that was horrible or you.