How Liberals Destroyed Social Security...

OK Midas, Let's play -

Philosophically, your point of choice is flawed. True choice would be, 'hey, set aside what you want, when you want, wherever you want'. You and I both know the result of that, most people will not participate - at all. So your chant of CHOICE is already flawed. I administer the 401K at my company, and I know that (despite a very generous matching program) less than 50% of eligible employees participate in the program. A lot of people do not tend to look forward to their older years. They live for today, and figure tomorrow will take care of itself.

Mathmatically, your idea does not work.

Let's look at the administration costs of a privatized program alone. Who do you think is going to bear the burdon of the cost of such overwhelmingly diverse choices that will be made, assuming that 15% manditory particpation in the program is instilled? The federal government? Where do those administation funds come from - the 15%? Well, now you're looking at an aggrigate 12% at best.

Now tell me, if another hit happens to the stock market, such as the tech crash of the later portion of the 90s - which, I will tell you, most people lost a significant amount in their 401Ks (the same areas they would probably 'choose' to divert their FICA funds to, under your unrealisitic program) - are people going to do the responsible thing, and say 'hey, I guess instead of Midas' 59.5 retirement, I'm going to have to retire at 69.5 years.' You and I both know that won't happen. People will retire, and should they outlive their principle, they will be broke in their 70s and unemployed and face terrible barriers to re-enter the work force... so who takes care of them? You? It's going to happen - just a matter of time before the right circumstances are in place.

Now riddle me this: If the current system is destined to draw on it's principle, as it stands in its current situation, at approximately 2018... what do you think the result is going to be when it becomes devastatingly underfunded because of the diverting of funds into privatized accounts? Are we just going to say 'sorry charlie' to the millions of people who are semi-close to retirement age right now? That's ok, though, because *YOU* will be better off, though, right?

Think again, you won't be. The Federal government cannot accept an uninsured risk of several American poor investors that are left without a substantial account to retire on in their elderly years... so what, you ask? That's there problem... wrong again. You see, you (as a citizen of the US under such a decentralized program) will have to help cover the cost of such an insurance program... so now what, an aggregate 9%, maybe, remains? It's possible, and entirely theoretical. Because that CD that you mentioned earlier in your post? What happens when your money is locked in for, say, 10 to 20 years, and inflation hits, and suddenly your return is being outperformed by the devaluation of the dollar? Good plan (at least it seemed so today...). Darn that uncertainty of tomorrow. I guess if that happens, it's fortunate that the rest of us paid for that theoretical insurance to make up for your poor choice in investment, or else you're in a world of financial hurt, brother!

Then there's the portion of America who will, undoubted, invest their money in the most risky of ventures they are allowed in the dream of being wealthy in their older years... Now, what happens if those risks don't pan out? Now you have more people like yourself that *I*, or my financially responsible offspring, have to pay for for their stupidity... Well, either that, or they get some other avenue of government assistance to live off of, then taxes goes up, and *I*, or my financially responsible offspring, STILL end up paying for these people.

And that's what happens under decentralized risk, Midas, there are winners and there are losers. The losers won't just die because they have no money, so what do the rest of us do? Well, all we have to say is - thank god you got your CHOICE. You can always use CHOICE to pay the rent when you're 73.

Now, I will grant that some of these pitfalls are theoretical, but they appear more than likely if we adopted your plan. If not likely, explain to me how YOU suggest we solve the problems they address. It is also just a few of the many risks and financial shortcomings of your idea. This would be nowhere NEAR a complete list of the burdons that such a transition amounts to.

But now, because I have pointed out some fiscal reasoning, I guess you'll just say I'm a typical liberal - 'anti-this and anti-that', right?

 

No...not at all...that was actually one of your better posts as it was constructive and well thought out.

The private accounts choice amounted to what?...up to 2.5% of the 15% that is paid into FICA?? That is not as dramatic as one would believe and you are right, too many stupid people live for today and depend on everybody else to take care of them tomorrow. Why a person would not participate in a 401-K where their employer matches their contributions dollar for dollar is just plain STUPID. But look at the people you administer that 401-K plan to...some people get it and many are totally lost...like this intellectual person:



As for the stock market...all things being equal, the market has always gone up over the LONG term. So if you are in your 20's and want to throw part of the 2.5% into higher risk funds, go right ahead. Would I advise a person who is it his late 50's to do that? Heck no...but when you give ownership back to the individual, you will be surprised how people pay attention to THEIR funds.

I just what to know what RIGHT does the government have to take monies from tax paying producers and give it away to people that did not earn it or have no intention of earning this money anyway? It is like me coming into your house and saying I am taking this because I need it and DEMAND it. "But wait!", you say, "I earned that for MY family."

The "too bad" or "tough cookies" attitudes of people that believe in all of these entitlements doesn't fly with me. It is this "I deserve it/I demand it" attitude that will eventually bring down this country.

 

I can't argue that - I dislike the me first attitude and the sense of entitlement as much as you, on the other hand I'm glad that most people are not out there freezing in the winter or starving in the streets. I don't like to see people suffer, so as much as I am disappointed with people who choose to not work, I am aware that my sympathy does its part to enable it.

For social security, I think it can be salvaged, but I am not educated on the interworkings enough to know how. the good folks at the AARP understand it far better than I do, and I have not seen them issue a plan to significantly extend the lifeline... I see dangers with the idea of privatization, and they aren't being presented along side the idea, so it scares me that Americans are drawing ideas on problems they have not been sufficiently informed on... That's dangerous.

I have to believe that there are many far more intelligent people than myself working on this problem - because if there isn't, and the only people covering it amount to a bunch of political hacks, we are in a lot of trouble.

 

Your sympathy? Fine, but what if someone else is not so sympathetic?

Yes; we all are in big trouble, because the only people covering it are a bunch of political hacks.