RE: Values: Fairness

[Richard Arsinow <richard.arsinow@rauland.com>]

Thank you, Mr. Morgan, for the kind words.  That original post was
over a month ago.  It's nice to see a newcomer to the board go back
and read from the beginning.

I submitted the following suggested questions in the hope that they
would be used in the Options for Reform survey, but I was too late.
Here I did touch upon the marriage penalty as well as a number of
other issues this forum should address.  It would have been nice
to get the public's viewpoint on as many of these as possible:

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Was Social Security originally billed as

   *a retirement system?

   *a social insurance program

   *both?

Is Social Security now

   *a retirement system?

   *a social insurance program?

   *both?

Do you think Social Security balances features of a retirement
system and features of social insurance in a way that is fair to
all participants?

   *yes

   *no

   *comments:________________________________

Which retirement system do you think is more fair to its participants?

   *one which pays disproportionately less to those who contribute
   more and pays disproportionately more to those who contribute
   less

   *one which pays in direct proportion to contributions

Would you like to see Social Security changed or replaced so that
it would pay retirement benefits in direct proportion to contributions?

   *yes

   *no

Some individuals and organizations suggest that Social Security
benefits be reduced or eliminated for participants who are otherwise
eligible for their calculated benefits based on their contributions
during their working years, but who have other income from working
during retirement, savings and/or investment.  Proponents call this
"means testing".  Are you in favor of reducing or eliminating
benefits in this way?

  *yes

  *no

The topic of intergenerational fairness has been recently discussed.
Critics of Social Security point out that, provided no changes are
made, if you are working now, your grandparents received much more
from Social Security than they put in, you may receive significantly
less to somewhat less to slightly more than you put in, depending
on how close you are to retirement, and your grandchildren will
receive far less than they put in, if anything at all.  When you
think abouth the fairness of this, is it of concern to you?

   *yes

   *no

Would you like to see Social Security changed or replaced in a way
which would eliminate intergenerational inequity in the future?

   *yes

   *no

The topic of a "safety net" has been recently discussed.  Proponents
argue that there should be a minimum retirement income provided to
all retirees who meet minimal eligibility requirements relating to
working in covered employment for any combination of ten years'
time.  Which solution do you think is best?

  *There should be no minimum.  Only benefits in direct proportion
  to contributions should be paid.

  *There should be such a minimum, and the benefits which exceed
  those in proportion to contributions should be paid for using
  retirement system funds.

  *There should be such a minimum, and the benefits which exceed
  those in proportion to contributions should be paid for using
  general funds such as those raised through income taxes.

  *Other:____________________________

For federal income tax purposes, employers may deduct their share
of the FICA or employment taxes they pay, but employees may not.
Do you think that Social Security benefits should be taxed?

  *No.  Not under any circumstances.

  *50% of all benefits should be taxed.

  *85% of all benefits should be taxed.

  *Up to 50% of benefits should be taxed when recipients have other
  income above a certain threshold, and up to 85% of benefits should
  be taxed when recipients have other income above a second threshold,
  regardless of medical or other deductible expenses, as under
  current law.

  * Other:________________________

Should the continued taxation of benefits, or eliminating or changing
the tax, be part of this discussion and be addressed in every
proposal put forward?

  *yes

  *no

Some of the originally published statements about Social Security
stated that participants would have a "right" to their benefits,
but the Supreme Court ruled that they have no such "right".  Do
you feel that you should have a legal "right" to your Social Security
benefits?

  *yes

  *no

Provided all the features of Social Security would be covered to
your satisfaction, are you in favor of splitting Social Security
into two programs, one to cover the social insurance needs such as
disability insurance, survivors' benefits and retirement "safety
net", and the other which would be purely a retirement system which
is self funded and provides fair benefits to all of its participants?

  *yes

  *no

If the social insurance needs were separated and covered by other
mechanisms, how should your contributions to the retirement system
be handled?

  *Mingled with others and invested by the government in the U.S.
  Treasury.

  *Kept in my own account and invested by the government in the
  U.S. Treasury.

  *Mingled with others and invested by the government in municipal
  and corporate bonds and stock funds.

  *Kept in my own account and invested by professional investment
  managers in my choice of Treasury securities, municipal bonds,
  corporate bonds, stock funds or a combination of these.

  *Other:________________________

If a man and a woman both have worked full careers, their Social
Security benefits as a married couple may be less than the total
of their benefits if they are single.  Is this fair?

  *yes

  *no

Should Social Security be changed or replaced so that this "marriage
penalty" is eliminated?

  *yes

  *no

If a man dies before collecting Social Security benefits, his widow,
when eligible for benefits, may collect the benefits due her, or
the benefits due him if they are greater.  If she takes his benefits,
hers are lost forever.  If she takes her own, his are lost forever.
Is this fair?

  *yes

  *no

Should Social Security be changed or replaced so that these earned
benefits are not lost?

  *yes

  *no ---------------------------------------------------------------

You should express your views in as many of these roundtables as
possible.  When others focus on how many people have been kept from
poverty by SS and how, with certain minor fixes, its solvency can
be extended, bring up intergenerational equity and how these measures
do nothing about it.  When others tout the defined benefits of SS,
remind them that defined benefit plans are losing favor to defined
contribution plans in the private sector, and how SS is the only
defined benefit plan which is not self-prefunded.  If you do not
believe in redistribution of funds from above-average-wage earners
to below-average-wage earners, say so.  Remind those who advocate
investing trust fund assets collectively in private markets that,
while this improves the system's solvency, it does nothing to better
the return on contributions.  Note how, in this forum, those who
advocate "saving" SS often want to raise the normal retirement age,
while those who favor converting to a system of individual accounts
want each individual to determine his or her own retirement age.
Which approach is more in keeping with the trend of public preference?
Finally, note that some individual account proposals would let each
wage-earner decide whether to stay under SS or opt out into the
new program, with recognition of past SS contributions.  Those who
opt out would continue to pay something into SS, for which they
would receive zero return, in order to fund the transition.

Welcome to the forum.  Please participate.