Tuesday, February 08, 2005

Democrats only: Please comment here.

The relevant Jim Lehrer episode has been deleted, so please tell me this. I'm undecided on this issue and want to hear some answers.

--Why is privatizing Social Security a bad idea? Explain to me how the status quo (or some other plan than the President's) is more likely to help me in my later years. I hate economics, but I'm a smart guy who's not afraid of math, so make your case.

8 comments:

Anonymous said...

Ok, I'm not an economist either, but here's my .02. Social Security is like an insurance policy that the government makes everyone buy. It's not supposed to give you 100% return on the money you make. It is supposed to help out everyone, from the least fortunate to the most fortunate.

The big reason why this whole privatizin' scheme is so bad is that it completely neglects the following reality of SS: not all the beneficiaries are retirees. What about the recently widowed? The permanently disabled? These folks are one of the reasons that SS is there in the first place.

And if helping out your fellow countryman isn't enough of a reason to leave SS alone, ask your conservative friends the following question: Is it wise for the Federal Government to dump such an enormous amount of capital into our marketplace? Isn't the government supposed to stay out of the marketplace? Won't this kind of privatiaztion scheme wreak havoc on the market?

Regards,
tommyspoon

Anonymous said...

Just a quick addendum to my earlier post, and one that answers your question more directly, TRP: SS isn't about you. It was never about you. It's about all of us. Every single American citizen can benefit from SS, not just you. That widow and that permanently disabled worker (think construction worker now quadrapalegic because of an accident at a job site) I mentioned earlier really need the help that SS provides. More so than either of us.

We all take out insurance on our cars, our homes and ourselves. We all hope that we never have to use it. SS is the same thing: we hope that we never have to use it. But thank goodness it's there.

That's why it should be adjusted and tweaked now and then. But that's also why it should be left alone.

Regards,
tommyspoon

Joe said...

Here's my Democrat answer. Actually, this is somewhere closer to Christian Democrat or Socialist.

Social Security Is Welfare.

Lather, rinse, repeat. Social Security Is Welfare.

It's designed to keep old people from starving when they can't work anymore. And maybe to make it more possible for them to retire and get out of the way so a young person can fill their job.

We shouldn't privatize it for the same reason we shouldn't rely on purely privatized aid to the homeless or starving or sick. It's our job to maintain a very basic level of human dignity, to the extent we can as a society. Because It's The Right Thing To Do.

How should it help you? Well, I'm well outside what I think the Democratic mainstream says, but frankly, my answer is not one damn bit. I strongly believe in stringent means testing for Social Security, and my hope for you is that you've got a job with a good retirement/pension plan which will ultimately provide a better standard of living than what our kids' taxes will provide.

Personally, I hope never to collect a dime of SS. I think my parents collect it, I know they'd be doing OK without it, and it frosts my cookies. But I also know people who will probably work until their bodies are worn out and then have not much to show for it. IMNSHO, Social Security is for them. People who can walk the tightrope have no business bouncing off the safety net.

These are ugly statements, but they're what I believe and I think the absence of them in our political debate is a peril.

Anonymous said...

As if I need to add another reason not to tamper with SS... the Washington Post gives me another one: President Bush is a big fat liar.

http://www.washingtonpost.com/wp-dyn/articles/A9090-2005Feb8.html

From the article: "If economic growth is slow enough that we've got a problem with Social Security, then we are also going to have problems with the stock market. It's as simple as that," said Douglas Fore, director of investment analytics for TIAA-CREF Investment Management Group.

Regards,
tommyspoon

lemming said...

Yeah, what they said. SS also provides options for the person who stayed at home with the kids, put little or nothing into a 401k, but was nonetheless a huge contributor to the success of the other's career.

The cynical side of me also doesn't trust Americans to do the right thing with said investments. Rememner a few years back when everyone was putting money into the dot com craze? This was the big example cited by the Repubs as a way to make more money. I totice it doesn't come up these days.

OK, so leave out dot coms - let's say that I am proud of my employer and purchase stock in the company and it goes belly under. (Enron anyone?)

SS was never intended to be the money upon which people retired. It was designed to HELP. Augment. Supplement. The problem is that too many folks count on it as their only retirement money.

Anonymous said...

Amen to all of that, and then on to some practical ways we might shore up the system:

One approach is to up the retirement age. I personally don't like that one. I want my parents to be able to retire soon so I can see more of them.

Another, better approach is to raise the cap on the amount of income that's taxed under social security. Basically, we only tax income up to a certain amount for the purposes of social security. We could raise that cap and thus raise the necessary money to save the system. It's a simple fix, and fits right in line with the principles of distributive justice. Which means that lots of people with money would hate it.

pax
Matt

Anonymous said...

Joe opined: "I strongly believe in stringent means testing for Social Security..."

I'm listening to Paul Krugman (NYT columnist and Econ Professor at Princeton) and he's against means testing for three reasons:

A. It wouldn't save that much money.
B. The formula is already tilted toward lower income folks.
C. SS is the most progressive program that our government has ever created. You can't leave anyone out because it would cause more upset to the system.

So, there you have it.

Regards,
tommyspoon

Jude Thomas said...

Simple. Social Security in its original form was supposed to compound over the years and be saved and NEVER DIPPED into under ANY circumstances. Well, now that our politicians have done years of dipping, IF there is a crisis, it is one they caused. And, since they are corporate rich types, their answer is to GAMBLE it on the stock market. Because, you know how that works all the time. The Bushies went from calling it privatization to "personal savings accounts" to make it sound more palatable--because the constituency wasn't thrilled about "privatization". They've got their fingers to the wind on this issue. The third rail of issues in politics is considered to be social security by some and the Draft by others. I guess another way of saving social security would be to kill off the bulk of a young generation too. (i'm being ironic)