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"WHY REFORM NOW?" IS INDEED A GOOD QUESTION. SOCIAL SECURITY WILL PAY FULL BENEFITS FOR NEXT 35 YEARS, AND WITH NO ADJUSTMENTS WOULD STILL BE ABLE TO COVER 65-75 PERCENT OF SCHEDULED BENEFITS FOR THE NEXT 40 YEARS.
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If it is ok to see benefits reduced to 65 to 67% in the future, why not just cut today's current benefits across the board to 65% of what they are today? If it is good enough for those in the future, it is good enough for those now.
You talk about increased benefits in the future being greater than they are now. Guess what, your benefits are greater than the person who retired one year before you! The OASI benefit formula is structured to keep pace with the average wage up till age 60. This ensures the retiree with the same standard of living as a basis point and the increases the benefit by inflation there after. I would imagine the poverty level will also increase pretty much at the rate of wages.
(These reduced benefits will be greater than full benefits now in purchasing power due to increases in wages, and thus, benefit levels). The question "Why reform now?" is begging the question: "Why fix Social Security when it's not broken?"
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THERE IS MUCH REASON TO QUESTION THE MOTIVES OF "REFORMERS", WHO, ACCORDING TO A POLICY REPORT BY THE ECONOMIC OPPORTUNITY INSTITUTE, A PUBLIC POLICY INSTITUTE IN WASHINGTON STATE, ARE FUNDED BY INVESTMENT HOUSES LIKE DUPONT COMPANY AND MORGAN STANLEY. (THE REPORT IS AVAILABLE AT THEIR WEBSITE: WWW.ECONOP.ORG).
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This is a good one. I have been modeling OASI for 25 years and no one has given me one penny for my information.
******************************************************************** MOST IMPORTANTLY, "REFORM" PROPOSALS DISMANTLE THE CURRENT SOCIAL SECURITY SAFETY NET TO TURN OUR NATION'S MOST SUCCESSFUL INSURANCE PLAN INTO AN INVESTMENT SCHEME.
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If social Security is the most successful program, I would hate to see an unsuccessful program. What has it done for us?
1. It has increased a tax rate from 2% on the first 110% of the average wage to 15.3% on the first 275% of the average wage. This is great, more revenue.
2. It has created a cry for tax cuts on workers and low income people. As these cuts have bene enacted, the revenue for the rest of the budget went down. Guess what happened? Deficits. You may think Social Security as being the provider of money for all other programs, but you are wrong. We went from funding our general expenses 100% to funding them partially so we can create a OASI fund to fund future retirees. What a joke!
3. Social Security has enumerated all of us who want to work, get married, buy stock, sell a house, travel, get a drivers license, send our kids to school, hunt, fish, etc. Great idea. I think a book stated something about enumerating the people and it was a bad thing.
4. It has caused a second wage earner to enter the work force to make ends meet. It has created day care and broken up the family.
5. It has put more children into poverty. Look at the rate of change in poverty of children from 1960 to 1999. Correlate this to FICA tax increases. They go hand in hand.
6. COLA is a runaway train. It is not based on the ability of the workers to make payments, but strictly on the number of retirees drawing benefits. Whip me a little bit more, I like to work for you. Boy I thought we did away with slavery.
7. It has an unfunded liability of over $10 Trillion. What would an unsuccessful program have?
******************************************************************** THE EOI SUGGESTS TWO SIMPLE STEPS TO FILL THE GAP PROJECTED TO OCCUR IN 2034. 1. ELIMINATE THE CAP ON TAXABLE INCOME: "TODAY, A WORKER WHO IS MAKING $72,600 AND A WORKER WHO IS MAKING $7.8 MILLION CONTRIBUTE THE EXACT SAME AMOUNT IN FICA TAXES, REPRESENTING 6.2% OF THE FORMER'S INCOME, AND ONLY .05% OF THE LATTER'S." 2. USE 1/4 OF THE 15-YEAR BUDGET SURPLUS.
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Why raise the taxes from the workers? You must not think we are paying enough. Why not raise the taxes on the elderly by getting rid of the higher standard deduction. This is not based on need at all, but AGE. Why not get rid of the extra personal exemption on based on AGE. Sounds like AGE DISCRIMINATION!
Please provide a printout of your plan showing the 1/4 of the 15 year budget surplus and how that helps. Please look at Clintons plan using a higher percentage Take a look at the cash flow required to reach solvency (green) and how it compares with Clinton's plan and current method. http://www.surfnet1.net/dadbill/charts/plan_optimistic.gif
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THEN, WE SHOULD EXPAND SOCIAL SECURITY, BY HOLDING THE RETIREMENT AGE AT 65, AND BY "INCREMENTALLY INCREAS[ING] SOCIAL SECURITY BENEFITS FOR LOW INCOME AND MIDDLE CLASS RETIREES."
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Now this beats all! You want to maintain the age at 65, raise the benefit rates for low and middle class retirees, yet you think a paying 65 to 75 % of the future benefit is good. Will you make up your mind! Is it a benefit cut you want future retirees to take or do you want to increase them?
