On February 02 2011 05:59 barkles wrote: No one in their right mind would voluntarily pay for social security. Why wouldn't you just take that money and put it in an investment portfolio and make a better return than what the govt will give you?
There are also significant concerns about the financial solvency of these programs.
I'll preface this by saying that I am not an economist in any way. I have only a basic grasp of how the stock market works. I sort of feel that I understand the general theory of it, but honestly I haven't a goddamn clue what happens on wall street or in any other major stock market.
However, to move onto my point, can *everyone* really make an "investment portfolio" that's going to pay off? Can you really guarantee that a bunch of stock is going to stay solid and continue growing until you're ready to retire? If it was as easy as "yeah just go get a pro portfolio u noob", wouldn't more people do that? One of my older cousins is an economist, and works whatever job it is that economists do. He lost a *shitload* of money in the 2000 or so market crash, and he's told me quite plainly that he'll likely never get back all the money he'd put into it. My father tells a similar story. So even the experts can mess up and make mistakes. I find it a bit unrealistic to assume that everyone and their mother can make sound financial decisions and that every investment portfolio is magically guaranteed success over a very long period of time.
Secondly, isn't a 401k plan quite similar to social security? Sort of a privatized version of such? Your employer takes a chunk of your paycheck, puts it off into a magical account somewhere, and you get it back when you retire. I know this system really appeals to many Americans, simply because we're so goddamn hard for the "pull yourself up by the bootstraps" mentality, and value individual success highly over community success. Lots of Americans hate the idea that their tax dollars go to anyone but themselves. But what about those poor bastards who had 401ks with Enron? People can still get screwed over. A government run 401k type policy is basically what Social Security is trying to accomplish, no?
Finally, do you *really* think that if people were given the option to stop paying SS taxes, that they'd all just go and invest it soundly? They wouldn't splurge on a new TV instead? (Or more realistically in the current economy, pay off that late utility bill. ) A lot of people just plain cannot realistically plan for the future. I know I'm guilty of this for sure. But here we are, a bunch of (and I'm going to generalize here), well educated, mostly wealthy or at least middle class, folks with the leisure time available to spend having philosophical and economic debates on TL.
There's a *lot* of people out there who never had the same opportunities that you or I did.
Excellent excellent post. The idea that we can all get rich together on the stock market with our 401k's is a myth. As often as not, when you make money on the market, someone else is losing money to facillitate that. There is a general perception that everyone lost tons of money when the housing bubble burst. However, there was a small group of shrewd individuals who spotted the trend before everyone else and bet against it and made BILLIONS when the subprime mortgage market went belly up (these people were the ones that AIG owed so much money to). I am not criticizing these people at all, they made brilliant decisions to go against the grain and momentum of the market and they were rewarded appropriately for their risk. Anyway, the moral of the story is, in order to make a buck, someone else is losing a buck.
You misunderstand the meaning of getting rich together. The meaning is the action of exchange being mutually beneficial, as both actors prefer it to any other possible course of action. The good received is strictly prefered to the good given for something, due to being related by exchange. This is in contrast to the tax-spend paradigm of govt activity.
On February 02 2011 05:59 barkles wrote: No one in their right mind would voluntarily pay for social security. Why wouldn't you just take that money and put it in an investment portfolio and make a better return than what the govt will give you?
There are also significant concerns about the financial solvency of these programs.
I'll preface this by saying that I am not an economist in any way. I have only a basic grasp of how the stock market works. I sort of feel that I understand the general theory of it, but honestly I haven't a goddamn clue what happens on wall street or in any other major stock market.
However, to move onto my point, can *everyone* really make an "investment portfolio" that's going to pay off? Can you really guarantee that a bunch of stock is going to stay solid and continue growing until you're ready to retire? If it was as easy as "yeah just go get a pro portfolio u noob", wouldn't more people do that? One of my older cousins is an economist, and works whatever job it is that economists do. He lost a *shitload* of money in the 2000 or so market crash, and he's told me quite plainly that he'll likely never get back all the money he'd put into it. My father tells a similar story. So even the experts can mess up and make mistakes. I find it a bit unrealistic to assume that everyone and their mother can make sound financial decisions and that every investment portfolio is magically guaranteed success over a very long period of time.
Secondly, isn't a 401k plan quite similar to social security? Sort of a privatized version of such? Your employer takes a chunk of your paycheck, puts it off into a magical account somewhere, and you get it back when you retire. I know this system really appeals to many Americans, simply because we're so goddamn hard for the "pull yourself up by the bootstraps" mentality, and value individual success highly over community success. Lots of Americans hate the idea that their tax dollars go to anyone but themselves. But what about those poor bastards who had 401ks with Enron? People can still get screwed over. A government run 401k type policy is basically what Social Security is trying to accomplish, no?
Finally, do you *really* think that if people were given the option to stop paying SS taxes, that they'd all just go and invest it soundly? They wouldn't splurge on a new TV instead? (Or more realistically in the current economy, pay off that late utility bill. ) A lot of people just plain cannot realistically plan for the future. I know I'm guilty of this for sure. But here we are, a bunch of (and I'm going to generalize here), well educated, mostly wealthy or at least middle class, folks with the leisure time available to spend having philosophical and economic debates on TL.
There's a *lot* of people out there who never had the same opportunities that you or I did.
I'll preface this by saying that I AM an economist (or at least, an economics PhD student).
You're very right. Social Security exists because most people are too stupid to know how to save money. It's not because they "didn't have opportunities." There are plenty of free, publicly available and easily accessible resources on safe investing. It's because they're lazy and don't want to learn or have other pressing financial concerns that they (often, but not always, erroneously) think are more important than saving for their future.
I did specify people in their right mind though, so I'm going to say that means people who have educated themselves on basic personal finance.
To your other point about the safety of these funds in investment vehicle: I don't know anything about what sort of interest rate (if any) a person gets for their SS contributions, but I do know that there is absolutely no way that it exceeds the long term Treasury bond rate. This means that a private investor could do no worse by investing without SS, and could probably do way, way better through (relatively safe) investment vehicles like money market funds and index funds.
Finally, if the financial problems with SS persist, increased taxes attempting to balance the SS books will further hinder the benefits that SS provides.
On February 01 2011 16:57 LyRa wrote: If they were optional and people had the choice not to pay - they probably wouldn't.
Yep, because people in general are stupid.
Those taxes are not just for your future, they are for those who already need the money. You are giving the money to the community, so those that are retired already can use it, people that are ill can get medical care, etc.
In turn for paying those taxes you can expect people to pay for you when you get old or require medical care.
I don't know the correct english term, but in germany we call it a "generation contract". This generation pays for the previous, so the next will pay for us, knowing that those after them will pay for them.
Of course this doesn't work in the selfish USA, where everyone only cares about himself.
I pay my taxes and would pay them if they were voluntary, i don't even care about getting any tax refunds because in the end, the money will be used for the community and i trust in the government to use it to it's best ability for the good of everyone.
User was temp banned for this post.
If only you knew... Ok. I'll tell you. This doesn't work in the US because right now we have more people retiring than people entering the work force. What do you think happens now? The social security starts to run a huge deficit, but wait! It can't be! It was never designed to be in the red. It was designed to always maintain itself, but it's not going to work. I doubt I'll ever retire with a S.S. income. It'll probably be gone by the time I retire.
This is the common misconception.
We saw this coming. If you're talking about 'going into the red' meaning a negative bank balance, you're wrong. There is a massive surplus invested all over the place and yes, that surplus will start to drain as baby boomers retire and will continue for the 20-30 years they have left. When they start to kick the bucket, it'll normalize itself and it'll 'go back into the green'.
The problem is it can't have a negative balance. Where is the money going to come from? The government? Here are the figures from the SS Administration itself.
* Begin paying out more than it takes in as revenues in 2017. * Exhaust its "trust fund" in 2041. * Require $4.7 trillion in extra revenue to pay estimated benefits for the next 75 years.
That's $4.7 TRILLION. To put it into perspective, China's GDP is $5.7 trillion. Even they couldn't afford to bail us out of the S.S. mess that's going to happen.
No, it can't, but why would it?
It can be completely self-sustainable by reducing payments out, or increasing payments in. And that's 4.7 trillion dollars that need to be made over the next 75 years, not 4.7 trillion that is needed RIGHT NOW.
Its all estimates. They look bad. Changes will be made, to ensure to system continues to run. Our generation is probably going to have to foot a big chunk of that bill. Considering how almost painfully easy our lives have been relative to say, the kids dying by the truckload in the 40s, or those having to work their way back from the ground up after the great depression, and generation X-ers sacrificing their own comfortable retirement so that their kids don't live below the poverty line, I'd say some higher taxes are a small price to pay.
Most people here have absolutely no clue what they are talking about and will be surprised to hear that the United States among industrialized states has probably the highest average number of working hours and, in amazing counterpoint, some of the worst benefits, and has seen wages stagnant or decline while these working hours increase meanwhile a tiny elite have been making out like bandits.
In other words these people in the United States who feel for some social net involving health care and social security are the most "lazy ass" people in the world working almost no hours, who are too "stupid" to save money for retirement and driving a "Lexus and BMW" paid for by other people's taxes.
For a reality check of real economics and "greater working insecurity" --Alan Greenspan
I dont understand your second paragraph and how you conclude these things based on the info in the first paragraph.
On February 02 2011 05:59 barkles wrote: No one in their right mind would voluntarily pay for social security. Why wouldn't you just take that money and put it in an investment portfolio and make a better return than what the govt will give you?
There are also significant concerns about the financial solvency of these programs.
I'll preface this by saying that I am not an economist in any way. I have only a basic grasp of how the stock market works. I sort of feel that I understand the general theory of it, but honestly I haven't a goddamn clue what happens on wall street or in any other major stock market.
However, to move onto my point, can *everyone* really make an "investment portfolio" that's going to pay off? Can you really guarantee that a bunch of stock is going to stay solid and continue growing until you're ready to retire? If it was as easy as "yeah just go get a pro portfolio u noob", wouldn't more people do that? One of my older cousins is an economist, and works whatever job it is that economists do. He lost a *shitload* of money in the 2000 or so market crash, and he's told me quite plainly that he'll likely never get back all the money he'd put into it. My father tells a similar story. So even the experts can mess up and make mistakes. I find it a bit unrealistic to assume that everyone and their mother can make sound financial decisions and that every investment portfolio is magically guaranteed success over a very long period of time.
Secondly, isn't a 401k plan quite similar to social security? Sort of a privatized version of such? Your employer takes a chunk of your paycheck, puts it off into a magical account somewhere, and you get it back when you retire. I know this system really appeals to many Americans, simply because we're so goddamn hard for the "pull yourself up by the bootstraps" mentality, and value individual success highly over community success. Lots of Americans hate the idea that their tax dollars go to anyone but themselves. But what about those poor bastards who had 401ks with Enron? People can still get screwed over. A government run 401k type policy is basically what Social Security is trying to accomplish, no?
Finally, do you *really* think that if people were given the option to stop paying SS taxes, that they'd all just go and invest it soundly? They wouldn't splurge on a new TV instead? (Or more realistically in the current economy, pay off that late utility bill. ) A lot of people just plain cannot realistically plan for the future. I know I'm guilty of this for sure. But here we are, a bunch of (and I'm going to generalize here), well educated, mostly wealthy or at least middle class, folks with the leisure time available to spend having philosophical and economic debates on TL.
There's a *lot* of people out there who never had the same opportunities that you or I did.
Excellent excellent post. The idea that we can all get rich together on the stock market with our 401k's is a myth. As often as not, when you make money on the market, someone else is losing money to facillitate that. There is a general perception that everyone lost tons of money when the housing bubble burst. However, there was a small group of shrewd individuals who spotted the trend before everyone else and bet against it and made BILLIONS when the subprime mortgage market went belly up (these people were the ones that AIG owed so much money to). I am not criticizing these people at all, they made brilliant decisions to go against the grain and momentum of the market and they were rewarded appropriately for their risk. Anyway, the moral of the story is, in order to make a buck, someone else is losing a buck.
Absolutely and totally incorrect. The economy is NOT a zero-sum game. If this was true, economic growth would never occur. If you have no economic knowledge whatsoever, you should not be making any claims in such forum topics as these.
On February 02 2011 05:59 barkles wrote: No one in their right mind would voluntarily pay for social security. Why wouldn't you just take that money and put it in an investment portfolio and make a better return than what the govt will give you?
There are also significant concerns about the financial solvency of these programs.
I'll preface this by saying that I am not an economist in any way. I have only a basic grasp of how the stock market works. I sort of feel that I understand the general theory of it, but honestly I haven't a goddamn clue what happens on wall street or in any other major stock market.
However, to move onto my point, can *everyone* really make an "investment portfolio" that's going to pay off? Can you really guarantee that a bunch of stock is going to stay solid and continue growing until you're ready to retire? If it was as easy as "yeah just go get a pro portfolio u noob", wouldn't more people do that? One of my older cousins is an economist, and works whatever job it is that economists do. He lost a *shitload* of money in the 2000 or so market crash, and he's told me quite plainly that he'll likely never get back all the money he'd put into it. My father tells a similar story. So even the experts can mess up and make mistakes. I find it a bit unrealistic to assume that everyone and their mother can make sound financial decisions and that every investment portfolio is magically guaranteed success over a very long period of time.
Secondly, isn't a 401k plan quite similar to social security? Sort of a privatized version of such? Your employer takes a chunk of your paycheck, puts it off into a magical account somewhere, and you get it back when you retire. I know this system really appeals to many Americans, simply because we're so goddamn hard for the "pull yourself up by the bootstraps" mentality, and value individual success highly over community success. Lots of Americans hate the idea that their tax dollars go to anyone but themselves. But what about those poor bastards who had 401ks with Enron? People can still get screwed over. A government run 401k type policy is basically what Social Security is trying to accomplish, no?
Finally, do you *really* think that if people were given the option to stop paying SS taxes, that they'd all just go and invest it soundly? They wouldn't splurge on a new TV instead? (Or more realistically in the current economy, pay off that late utility bill. ) A lot of people just plain cannot realistically plan for the future. I know I'm guilty of this for sure. But here we are, a bunch of (and I'm going to generalize here), well educated, mostly wealthy or at least middle class, folks with the leisure time available to spend having philosophical and economic debates on TL.
There's a *lot* of people out there who never had the same opportunities that you or I did.
I'll preface this by saying that I AM an economist (or at least, an economics PhD student).
You're very right. Social Security exists because most people are too stupid to know how to save money. It's not because they "didn't have opportunities." There are plenty of free, publicly available and easily accessible resources on safe investing. It's because they're lazy and don't want to learn or have other pressing financial concerns that they (often, but not always, erroneously) think are more important than saving for their future.
I did specify people in their right mind though, so I'm going to say that means people who have educated themselves on basic personal finance.
To your other point about the safety of these funds in investment vehicle: I don't know anything about what sort of interest rate (if any) a person gets for their SS contributions, but I do know that there is absolutely no way that it exceeds the long term Treasury bond rate. This means that a private investor could do no worse by investing without SS, and could probably do way, way better through (relatively safe) investment vehicles like money market funds and index funds.
Finally, if the financial problems with SS persist, increased taxes attempting to balance the SS books will further hinder the benefits that SS provides.
Yes yes, and USSR citizens were too stupid to find their own jobs, choose their own tv/radio channels to watch so the government had to make those choices for them, right?
On February 02 2011 05:59 barkles wrote: No one in their right mind would voluntarily pay for social security. Why wouldn't you just take that money and put it in an investment portfolio and make a better return than what the govt will give you?
There are also significant concerns about the financial solvency of these programs.
I'll preface this by saying that I am not an economist in any way. I have only a basic grasp of how the stock market works. I sort of feel that I understand the general theory of it, but honestly I haven't a goddamn clue what happens on wall street or in any other major stock market.
However, to move onto my point, can *everyone* really make an "investment portfolio" that's going to pay off? Can you really guarantee that a bunch of stock is going to stay solid and continue growing until you're ready to retire? If it was as easy as "yeah just go get a pro portfolio u noob", wouldn't more people do that? One of my older cousins is an economist, and works whatever job it is that economists do. He lost a *shitload* of money in the 2000 or so market crash, and he's told me quite plainly that he'll likely never get back all the money he'd put into it. My father tells a similar story. So even the experts can mess up and make mistakes. I find it a bit unrealistic to assume that everyone and their mother can make sound financial decisions and that every investment portfolio is magically guaranteed success over a very long period of time.
Secondly, isn't a 401k plan quite similar to social security? Sort of a privatized version of such? Your employer takes a chunk of your paycheck, puts it off into a magical account somewhere, and you get it back when you retire. I know this system really appeals to many Americans, simply because we're so goddamn hard for the "pull yourself up by the bootstraps" mentality, and value individual success highly over community success. Lots of Americans hate the idea that their tax dollars go to anyone but themselves. But what about those poor bastards who had 401ks with Enron? People can still get screwed over. A government run 401k type policy is basically what Social Security is trying to accomplish, no?
Finally, do you *really* think that if people were given the option to stop paying SS taxes, that they'd all just go and invest it soundly? They wouldn't splurge on a new TV instead? (Or more realistically in the current economy, pay off that late utility bill. ) A lot of people just plain cannot realistically plan for the future. I know I'm guilty of this for sure. But here we are, a bunch of (and I'm going to generalize here), well educated, mostly wealthy or at least middle class, folks with the leisure time available to spend having philosophical and economic debates on TL.
There's a *lot* of people out there who never had the same opportunities that you or I did.
I'll preface this by saying that I AM an economist (or at least, an economics PhD student).
You're very right. Social Security exists because most people are too stupid to know how to save money. It's not because they "didn't have opportunities." There are plenty of free, publicly available and easily accessible resources on safe investing. It's because they're lazy and don't want to learn or have other pressing financial concerns that they (often, but not always, erroneously) think are more important than saving for their future.
I did specify people in their right mind though, so I'm going to say that means people who have educated themselves on basic personal finance.
To your other point about the safety of these funds in investment vehicle: I don't know anything about what sort of interest rate (if any) a person gets for their SS contributions, but I do know that there is absolutely no way that it exceeds the long term Treasury bond rate. This means that a private investor could do no worse by investing without SS, and could probably do way, way better through (relatively safe) investment vehicles like money market funds and index funds.
Finally, if the financial problems with SS persist, increased taxes attempting to balance the SS books will further hinder the benefits that SS provides.
Yes yes, and USSR citizens were too stupid to find their own jobs, choose their own tv/radio channels to watch so the government had to make those choices for them, right?
I don't get your point. I'm one of the people who thinks that there are better alternatives to SS, as i think i make quite plain in my post. I merely stated the primary reasoning behind Social Security. If you think this is not why Social Security exists, then you are an idiot. Discussing why the USSR was a bad system does not belong in this thread.
On February 02 2011 05:59 barkles wrote: No one in their right mind would voluntarily pay for social security. Why wouldn't you just take that money and put it in an investment portfolio and make a better return than what the govt will give you?
There are also significant concerns about the financial solvency of these programs.
I'll preface this by saying that I am not an economist in any way. I have only a basic grasp of how the stock market works. I sort of feel that I understand the general theory of it, but honestly I haven't a goddamn clue what happens on wall street or in any other major stock market.
However, to move onto my point, can *everyone* really make an "investment portfolio" that's going to pay off? Can you really guarantee that a bunch of stock is going to stay solid and continue growing until you're ready to retire? If it was as easy as "yeah just go get a pro portfolio u noob", wouldn't more people do that? One of my older cousins is an economist, and works whatever job it is that economists do. He lost a *shitload* of money in the 2000 or so market crash, and he's told me quite plainly that he'll likely never get back all the money he'd put into it. My father tells a similar story. So even the experts can mess up and make mistakes. I find it a bit unrealistic to assume that everyone and their mother can make sound financial decisions and that every investment portfolio is magically guaranteed success over a very long period of time.
Secondly, isn't a 401k plan quite similar to social security? Sort of a privatized version of such? Your employer takes a chunk of your paycheck, puts it off into a magical account somewhere, and you get it back when you retire. I know this system really appeals to many Americans, simply because we're so goddamn hard for the "pull yourself up by the bootstraps" mentality, and value individual success highly over community success. Lots of Americans hate the idea that their tax dollars go to anyone but themselves. But what about those poor bastards who had 401ks with Enron? People can still get screwed over. A government run 401k type policy is basically what Social Security is trying to accomplish, no?
Finally, do you *really* think that if people were given the option to stop paying SS taxes, that they'd all just go and invest it soundly? They wouldn't splurge on a new TV instead? (Or more realistically in the current economy, pay off that late utility bill. ) A lot of people just plain cannot realistically plan for the future. I know I'm guilty of this for sure. But here we are, a bunch of (and I'm going to generalize here), well educated, mostly wealthy or at least middle class, folks with the leisure time available to spend having philosophical and economic debates on TL.
There's a *lot* of people out there who never had the same opportunities that you or I did.
[...] You're very right. Social Security exists because most people are too stupid to know how to save money. It's not because they "didn't have opportunities." There are plenty of free, publicly available and easily accessible resources on safe investing. It's because they're lazy and don't want to learn or have other pressing financial concerns that they (often, but not always, erroneously) think are more important than saving for their future. [...]
Haha, not what I meant by opportunities, but much thanks for the thorough response!
I mean more general-life opportunities. I used to volunteer with my mum, (she works at the national cathedral, and hosts tea parties for old people, gives tours to elementary/middle school kids, etc). We'd see all sorts of different students come in. The differences between the rich private school kids and the poor inner city kids is absolutely mind blowing.
One day we'll be giving a tour to rich private school kids. There'll be as many teachers/chaperons as there are students. They show up in a fancy charter bus, they're all well-dressed and groomed, and the kids are smart. They know all the answers to the little questions I ask them during the tour. They've clearly never wanted for much of anything in their lives. They're going to get a great education, and their parents will have no problems whatsoever sending them to a great university.
The public, (inner city DC school) kids are... it's just depressing. There will be *one* absolutely exhausted looking teacher trying to control 30-40 kids. These children, (99% black), are so woefully lacking in education. I'm talking about 7th graders who cannot add two-digit numbers together. Don't know who the first president was. These kids have probably lived off of fast food their entire lives, (nutrition plays a HUGE part in brain development), come from broken homes, or have abusive parents, and something like 40% of them will not graduate high school. They are so horribly unprepared for the real world, and they've been thrust into that system from day 1 merely by coincidence of where and to whom they were born.
Can we strictly blame these kids from growing up, getting pregnant at 16, and creating more kids of similar circumstance?
I'm sure that anyone who has money can find a public service for free investing advice, but honestly most of these kids will never have much money to invest in the first place. Sure we here at TL, (once again, people with free time to indulge in social debate with strangers on the internet), can dismiss these people as lazy or whatever else, and insist that they should pick themselves up off the streets and all that jazz. Maybe 1 in 1000 of them will, but certainly not the majority.
Man I wish I had a choice.. SS, Welfare, Medicare would be gone. I believe if you want something, get off your fucking ass and go get it yourself. Quit making excuses and find a solution.
For me, I feel better handling my financial future myself instead of relying on some government ran program that continues to put this country into a deficit. I'd rather use that money to invest in real estate then sell it when im ready to retire... at least it'll be worth something.
On February 02 2011 05:59 barkles wrote: No one in their right mind would voluntarily pay for social security. Why wouldn't you just take that money and put it in an investment portfolio and make a better return than what the govt will give you?
There are also significant concerns about the financial solvency of these programs.
I'll preface this by saying that I am not an economist in any way. I have only a basic grasp of how the stock market works. I sort of feel that I understand the general theory of it, but honestly I haven't a goddamn clue what happens on wall street or in any other major stock market.
However, to move onto my point, can *everyone* really make an "investment portfolio" that's going to pay off? Can you really guarantee that a bunch of stock is going to stay solid and continue growing until you're ready to retire? If it was as easy as "yeah just go get a pro portfolio u noob", wouldn't more people do that? One of my older cousins is an economist, and works whatever job it is that economists do. He lost a *shitload* of money in the 2000 or so market crash, and he's told me quite plainly that he'll likely never get back all the money he'd put into it. My father tells a similar story. So even the experts can mess up and make mistakes. I find it a bit unrealistic to assume that everyone and their mother can make sound financial decisions and that every investment portfolio is magically guaranteed success over a very long period of time.
Secondly, isn't a 401k plan quite similar to social security? Sort of a privatized version of such? Your employer takes a chunk of your paycheck, puts it off into a magical account somewhere, and you get it back when you retire. I know this system really appeals to many Americans, simply because we're so goddamn hard for the "pull yourself up by the bootstraps" mentality, and value individual success highly over community success. Lots of Americans hate the idea that their tax dollars go to anyone but themselves. But what about those poor bastards who had 401ks with Enron? People can still get screwed over. A government run 401k type policy is basically what Social Security is trying to accomplish, no?
Finally, do you *really* think that if people were given the option to stop paying SS taxes, that they'd all just go and invest it soundly? They wouldn't splurge on a new TV instead? (Or more realistically in the current economy, pay off that late utility bill. ) A lot of people just plain cannot realistically plan for the future. I know I'm guilty of this for sure. But here we are, a bunch of (and I'm going to generalize here), well educated, mostly wealthy or at least middle class, folks with the leisure time available to spend having philosophical and economic debates on TL.
There's a *lot* of people out there who never had the same opportunities that you or I did.
I'll preface this by saying that I AM an economist (or at least, an economics PhD student).
You're very right. Social Security exists because most people are too stupid to know how to save money. It's not because they "didn't have opportunities." There are plenty of free, publicly available and easily accessible resources on safe investing. It's because they're lazy and don't want to learn or have other pressing financial concerns that they (often, but not always, erroneously) think are more important than saving for their future.
I did specify people in their right mind though, so I'm going to say that means people who have educated themselves on basic personal finance.
To your other point about the safety of these funds in investment vehicle: I don't know anything about what sort of interest rate (if any) a person gets for their SS contributions, but I do know that there is absolutely no way that it exceeds the long term Treasury bond rate. This means that a private investor could do no worse by investing without SS, and could probably do way, way better through (relatively safe) investment vehicles like money market funds and index funds.
Finally, if the financial problems with SS persist, increased taxes attempting to balance the SS books will further hinder the benefits that SS provides.
Yes yes, and USSR citizens were too stupid to find their own jobs, choose their own tv/radio channels to watch so the government had to make those choices for them, right?
I don't get your point. I'm one of the people who thinks that there are better alternatives to SS, as i think i make quite plain in my post. I merely stated the primary reasoning behind Social Security. If you think this is not why Social Security exists, then you are an idiot. Discussing why the USSR was a bad system does not belong in this thread.
Quite unrigorous appliance of logic there. It was an analogy to show the thought behind the "too stupid to do x themselves" argument.
By the way, the same argument was used to justify slavery and serfdom. As we now know, it rested on a false premise. Nothing has either shown the validity of the premise of your argument.
On February 02 2011 07:24 Souljah wrote: Man I wish I had a choice.. SS, Welfare, Medicare would be gone. I believe if you want something, get off your fucking ass and go get it yourself. Quit making excuses and find a solution.
For me, I feel better handling my financial future myself instead of relying on some government ran program that continues to put this country into a deficit. I'd rather use that money to invest in real estate then sell it when im ready to retire... at least it'll be worth something.
yeah lazy-ass cancer patients and people with deadly diseases.. just excuses for sitting on your ass!
On February 02 2011 07:24 Souljah wrote: Man I wish I had a choice.. SS, Welfare, Medicare would be gone. I believe if you want something, get off your fucking ass and go get it yourself. Quit making excuses and find a solution.
For me, I feel better handling my financial future myself instead of relying on some government ran program that continues to put this country into a deficit. I'd rather use that money to invest in real estate then sell it when im ready to retire... at least it'll be worth something.
On February 02 2011 07:24 Souljah wrote: Man I wish I had a choice.. SS, Welfare, Medicare would be gone. I believe if you want something, get off your fucking ass and go get it yourself. Quit making excuses and find a solution.
For me, I feel better handling my financial future myself instead of relying on some government ran program that continues to put this country into a deficit. I'd rather use that money to invest in real estate then sell it when im ready to retire... at least it'll be worth something.
yeah lazy-ass cancer patients and people with deadly diseases.. just excuses for sitting on your ass!
good thing you came along and told em'
Sure, lets keep giving free food/money to the moms poppin out 10 fuckin kids living off welfare, while daddy is dealin drugs out in the back TAX FREE.
I gaurantee there are more able human beings taking advantage of welfare then there are that actually need it. The difference between now and when the program was developed is people now WANT to be on welfare. period.
On February 02 2011 07:24 Souljah wrote: Man I wish I had a choice.. SS, Welfare, Medicare would be gone. I believe if you want something, get off your fucking ass and go get it yourself. Quit making excuses and find a solution.
For me, I feel better handling my financial future myself instead of relying on some government ran program that continues to put this country into a deficit. I'd rather use that money to invest in real estate then sell it when im ready to retire... at least it'll be worth something.
yeah lazy-ass cancer patients and people with deadly diseases.. just excuses for sitting on your ass!
good thing you came along and told em'
Sure, lets keep giving free food/money to the moms poppin out 10 fuckin kids living off welfare, while daddy is dealin drugs out in the back TAX FREE.
I gaurantee there are more able human beings taking advantage of welfare then there are that actually need it. The difference between now and when the program was developed is people now WANT to be on welfare. period.
Im not saying some dont people exploit it... but seriously, medical care is really important. People with deadly/crippling diseases cannot earn money for themselves and needs the government to take care of them
On February 02 2011 07:30 Souljah wrote: Sure, lets keep giving free food/money to the moms poppin out 10 fuckin kids living off welfare, while daddy is dealin drugs out in the back TAX FREE.
I gaurantee there are more able human beings taking advantage of welfare then there are that actually need it. The difference between now and when the program was developed is people now WANT to be on welfare. period.
Race -------------- White 38.8% Black 37.2 Hispanic 17.8 Asian 2.8 Other 3.4
Time on AFDC --------------------------- Less than 7 months 19.0% 7 to 12 months 15.2 One to two years 19.3 Two to five years 26.9 Over five years 19.6
Number of children ------------------- One 43.2% Two 30.7 Three 15.8 Four or more 10.3
Age of Mother ------------------ Teenager 7.6% 20 - 29 47.9 30 - 39 32.7 40 or older 11.8
Status of Father 1973 1992 ------------------------------------- Divorced or separated 46.5% 28.6 Deceased 5.0 1.6 Unemployed or Disabled 14.3 9.0 Not married to mother 31.5 55.3 Other or Unknown 2.7 5.5
On February 02 2011 05:59 barkles wrote: No one in their right mind would voluntarily pay for social security. Why wouldn't you just take that money and put it in an investment portfolio and make a better return than what the govt will give you?
There are also significant concerns about the financial solvency of these programs.
I'll preface this by saying that I am not an economist in any way. I have only a basic grasp of how the stock market works. I sort of feel that I understand the general theory of it, but honestly I haven't a goddamn clue what happens on wall street or in any other major stock market.
However, to move onto my point, can *everyone* really make an "investment portfolio" that's going to pay off? Can you really guarantee that a bunch of stock is going to stay solid and continue growing until you're ready to retire? If it was as easy as "yeah just go get a pro portfolio u noob", wouldn't more people do that? One of my older cousins is an economist, and works whatever job it is that economists do. He lost a *shitload* of money in the 2000 or so market crash, and he's told me quite plainly that he'll likely never get back all the money he'd put into it. My father tells a similar story. So even the experts can mess up and make mistakes. I find it a bit unrealistic to assume that everyone and their mother can make sound financial decisions and that every investment portfolio is magically guaranteed success over a very long period of time.
Secondly, isn't a 401k plan quite similar to social security? Sort of a privatized version of such? Your employer takes a chunk of your paycheck, puts it off into a magical account somewhere, and you get it back when you retire. I know this system really appeals to many Americans, simply because we're so goddamn hard for the "pull yourself up by the bootstraps" mentality, and value individual success highly over community success. Lots of Americans hate the idea that their tax dollars go to anyone but themselves. But what about those poor bastards who had 401ks with Enron? People can still get screwed over. A government run 401k type policy is basically what Social Security is trying to accomplish, no?
Finally, do you *really* think that if people were given the option to stop paying SS taxes, that they'd all just go and invest it soundly? They wouldn't splurge on a new TV instead? (Or more realistically in the current economy, pay off that late utility bill. ) A lot of people just plain cannot realistically plan for the future. I know I'm guilty of this for sure. But here we are, a bunch of (and I'm going to generalize here), well educated, mostly wealthy or at least middle class, folks with the leisure time available to spend having philosophical and economic debates on TL.
There's a *lot* of people out there who never had the same opportunities that you or I did.
I'll preface this by saying that I AM an economist (or at least, an economics PhD student).
You're very right. Social Security exists because most people are too stupid to know how to save money. It's not because they "didn't have opportunities." There are plenty of free, publicly available and easily accessible resources on safe investing. It's because they're lazy and don't want to learn or have other pressing financial concerns that they (often, but not always, erroneously) think are more important than saving for their future.
I did specify people in their right mind though, so I'm going to say that means people who have educated themselves on basic personal finance.
To your other point about the safety of these funds in investment vehicle: I don't know anything about what sort of interest rate (if any) a person gets for their SS contributions, but I do know that there is absolutely no way that it exceeds the long term Treasury bond rate. This means that a private investor could do no worse by investing without SS, and could probably do way, way better through (relatively safe) investment vehicles like money market funds and index funds.
Social Security's function is not to be a financial tool to invest safely with some maximized interest rate. Most people see its function as similar to that of right to health care.
Finally, if the financial problems with SS persist, increased taxes attempting to balance the SS books will further hinder the benefits that SS provides.
Social Security doesn't have financial problems. That myth is a creation of the right wing attack on social security.
On February 02 2011 05:59 barkles wrote: No one in their right mind would voluntarily pay for social security. Why wouldn't you just take that money and put it in an investment portfolio and make a better return than what the govt will give you?
There are also significant concerns about the financial solvency of these programs.
I'll preface this by saying that I am not an economist in any way. I have only a basic grasp of how the stock market works. I sort of feel that I understand the general theory of it, but honestly I haven't a goddamn clue what happens on wall street or in any other major stock market.
However, to move onto my point, can *everyone* really make an "investment portfolio" that's going to pay off? Can you really guarantee that a bunch of stock is going to stay solid and continue growing until you're ready to retire? If it was as easy as "yeah just go get a pro portfolio u noob", wouldn't more people do that? One of my older cousins is an economist, and works whatever job it is that economists do. He lost a *shitload* of money in the 2000 or so market crash, and he's told me quite plainly that he'll likely never get back all the money he'd put into it. My father tells a similar story. So even the experts can mess up and make mistakes. I find it a bit unrealistic to assume that everyone and their mother can make sound financial decisions and that every investment portfolio is magically guaranteed success over a very long period of time.
Secondly, isn't a 401k plan quite similar to social security? Sort of a privatized version of such? Your employer takes a chunk of your paycheck, puts it off into a magical account somewhere, and you get it back when you retire. I know this system really appeals to many Americans, simply because we're so goddamn hard for the "pull yourself up by the bootstraps" mentality, and value individual success highly over community success. Lots of Americans hate the idea that their tax dollars go to anyone but themselves. But what about those poor bastards who had 401ks with Enron? People can still get screwed over. A government run 401k type policy is basically what Social Security is trying to accomplish, no?
Finally, do you *really* think that if people were given the option to stop paying SS taxes, that they'd all just go and invest it soundly? They wouldn't splurge on a new TV instead? (Or more realistically in the current economy, pay off that late utility bill. ) A lot of people just plain cannot realistically plan for the future. I know I'm guilty of this for sure. But here we are, a bunch of (and I'm going to generalize here), well educated, mostly wealthy or at least middle class, folks with the leisure time available to spend having philosophical and economic debates on TL.
There's a *lot* of people out there who never had the same opportunities that you or I did.
I'll preface this by saying that I AM an economist (or at least, an economics PhD student).
You're very right. Social Security exists because most people are too stupid to know how to save money. It's not because they "didn't have opportunities." There are plenty of free, publicly available and easily accessible resources on safe investing. It's because they're lazy and don't want to learn or have other pressing financial concerns that they (often, but not always, erroneously) think are more important than saving for their future.
I did specify people in their right mind though, so I'm going to say that means people who have educated themselves on basic personal finance.
To your other point about the safety of these funds in investment vehicle: I don't know anything about what sort of interest rate (if any) a person gets for their SS contributions, but I do know that there is absolutely no way that it exceeds the long term Treasury bond rate. This means that a private investor could do no worse by investing without SS, and could probably do way, way better through (relatively safe) investment vehicles like money market funds and index funds.
Finally, if the financial problems with SS persist, increased taxes attempting to balance the SS books will further hinder the benefits that SS provides.
Oh please, SS exists because people in congress voted to approve it, it went through, and then it was deducted from paychecks. It has absolutely zero direct relation anyone's ability or inability to invest or save.
On February 02 2011 07:24 Souljah wrote: Man I wish I had a choice.. SS, Welfare, Medicare would be gone. I believe if you want something, get off your fucking ass and go get it yourself. Quit making excuses and find a solution.
For me, I feel better handling my financial future myself instead of relying on some government ran program that continues to put this country into a deficit. I'd rather use that money to invest in real estate then sell it when im ready to retire... at least it'll be worth something.
yeah lazy-ass cancer patients and people with deadly diseases.. just excuses for sitting on your ass!
good thing you came along and told em'
Sure, lets keep giving free food/money to the moms poppin out 10 fuckin kids living off welfare, while daddy is dealin drugs out in the back TAX FREE.
I gaurantee there are more able human beings taking advantage of welfare then there are that actually need it. The difference between now and when the program was developed is people now WANT to be on welfare. period.
Im not saying some dont people exploit it... but seriously, medical care is really important. People with deadly/crippling diseases cannot earn money for themselves and needs the government to take care of them
Yes, I agree that some do need it.. disabled vets, children with diseases and so forth. The program had good intentions, until we allowed people to take advantage of it. Our solutions are always "throw money at it and hope it gets better" instead of actually fixing the issues.
Come to my neck of the woods and you'll see wtf im talking about. I came from a community that is poverty stricken, and everyday I see people taking advantage of the system. People here are always quick to have their hands out instead of just helping themselves.
On February 02 2011 05:19 Offhand wrote: The average adult American is 8 grand in debt. Consider that before making the call as to whether or not they're capable of saving for their future.
This isn't a valid point when we have the government running a debt based currency.
If people actually started saving overnight, our current economy would fall apart, and would have to be rebuilt. Because it is completely based on sustainability through debt. That is why the dollar is currently ~ -13 trillion. Business that only sell useless luxury items would disappear left and right, jobs would be lost, and entire new and different business would have to be created.
We have the government running a debt based currency.
We have the government teaching people through high school, why are they teaching people to be financially responsible??
Because it isn't desirable for them, they want the debt.
So we continue to let them run the debt scheme, and we continue to let them teach generation after generation.
And then we blame individuals because they are "not capable" of saving? There is no rationality behind this.
The government has created all these problems, which what government always does. Creates a problem, offers a solution, and becomes a little more powerful when they enact that solution.
Then eventually you have a whole population of people who are desperately dependent on the government to survive, and the government has little fear of being usurped.
I can't believe so many people don't understand this.
I've always looked at these systems the same way. In order for it to be worthwhile for one person to 'invest' so to speak, they have to get more out of it than they put in, which by definition means it has to be broken, or not worthwhile. Right?
Add on top of that the system of regulators, operators, collection/distribution, and other operating costs of a systems like these, and it cannot be worthwhile without creating debt somewhere.
On February 02 2011 07:55 Flanlord wrote: I've always looked at these systems the same way. In order for it to be worthwhile for one person to 'invest' so to speak, they have to get more out of it than they put in, which by definition means it has to be broken, or not worthwhile. Right?
Add on top of that the system of regulators, operators, collection/distribution, and other operating costs of a systems like these, and it cannot be worthwhile without creating debt somewhere.
Yep, because it's not a true investment in the sense of spending money to make money. It is simply wealth collection and then redistribution. Eventually either people don't get out what they put in, or they do and the system goes further and further into debt. We are already well past that point.
EPT
