djAdvocate
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Post by djAdvocate on Oct 21, 2013 19:16:23 GMT -5
"Tiresome", as euphenisms go, is quite mild. There are other, more precise adjectives. Virgil doesn't like it when i swear.
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djAdvocate
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Post by djAdvocate on Oct 21, 2013 19:18:39 GMT -5
Just as long as you're the one goes out and tell the seniors that they have to take a 10% haircut this year and another 10% haircut next year, even though things will cost 4% more this year, and another 4% more the year after that. Methinks your nose will be what's broke. I think it should be means tested, Virgil. I have nothing against taking "a 10% haircut" because I'm smart enough to realize I'm not the only one in this country that's going to be getting that same haircut. With the economy down, raises aren't what they had been, prices are rising for everyone, etc. I don't know why I would expect to sit here fat, dumb and happy while others take all the blows. I would, however, want to see means testing. Some folks could not afford such a cut. we should lift the cap, as well. all of this has been suggested. but the TP is totally against those changes, because most of them benefit from the current system.
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mmhmm
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Post by mmhmm on Oct 21, 2013 19:21:55 GMT -5
I agree, dj. Both those steps need to be taken. A lot of people who receive SS really don't need it. When I start hearing "I paid into it all those years, I WANT what's MINE!!" it makes me a little sick to my stomach. What the heck does it hurt someone who has more than enough to give something to someone else? That remains a mystery to me.
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Post by Virgil Showlion on Oct 21, 2013 19:24:37 GMT -5
Just as long as you're the one goes out and tell the seniors that they have to take a 10% haircut this year and another 10% haircut next year, even though things will cost 4% more this year, and another 4% more the year after that. Methinks your nose will be what's broke. I think it should be means tested, Virgil. I have nothing against taking "a 10% haircut" because I'm smart enough to realize I'm not the only one in this country that's going to be getting that same haircut. With the economy down, raises aren't what they had been, prices are rising for everyone, etc. I don't know why I would expect to sit here fat, dumb and happy while others take all the blows. I would, however, want to see means testing. Some folks could not afford such a cut. Suppose you do make cuts unevenly. I good portion of SS recipients--not all, but a good many--are in a better financial situation because they saved more, they worked longer, they planned for retirement, they made all the necessary sacrifices. By shifting the cuts disproportionately onto this group, you're partly or even completely nullifying the sacrifices they've made. And not only that, you've disincentivized others' making such sacrifices in future. This is seniors and social security to begin with. We're not talking about uber-rich corporate types who can stand to lose a few dollars. The cuts are going to hurt, and they're going to hurt deserving people, means-tested or not. I can stand wealth redistribution to a point, but at some point you've got to stop robbing Peter to pay Paul.
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mmhmm
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Post by mmhmm on Oct 21, 2013 19:30:24 GMT -5
I disagree, Virgil, and I'm one of the people about whom you're talking. Nothing can nullify what we did to prepare for retirement. I'd really wonder about a person who would allow themselves to be disincentivized by the idea they might be of real help to another human being. That's my view, and I am a senior on social security - not a corporate type. One thing we don't need is 30-somethings telling us what we think, or should think. I'm in favor of means testing, and I'll take the haircut for the benefit of those who weren't so fortunate.
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djAdvocate
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Post by djAdvocate on Oct 21, 2013 19:31:33 GMT -5
I think it should be means tested, Virgil. I have nothing against taking "a 10% haircut" because I'm smart enough to realize I'm not the only one in this country that's going to be getting that same haircut. With the economy down, raises aren't what they had been, prices are rising for everyone, etc. I don't know why I would expect to sit here fat, dumb and happy while others take all the blows. I would, however, want to see means testing. Some folks could not afford such a cut. Suppose you do make cuts unevenly. I good portion of SS recipients--not all, but a good many--are in a better financial situation because they saved more, they worked longer, they planned for retirement, they made all the necessary sacrifices. By shifting the cuts disproportionately onto this group, you're partly or even completely nullifying the sacrifices they've made. And not only that, you've disincentivized others' making such sacrifices in future. This is seniors and social security to begin with. We're not talking about uber-rich corporate types who can stand to lose a few dollars. The cuts are going to hurt, and they're going to hurt deserving people, means-tested or not. I can stand wealth redistribution to a point, but at some point you've got to stop robbing Peter to pay Paul. SS is not a serious problem imo. MC is another matter, entirely.
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Post by Virgil Showlion on Oct 21, 2013 19:51:58 GMT -5
There is more than an order of magnitude difference in scale, true. Not everybody is industrious, helpful, hard-working, mmhmm.
Our (Canadian) equivalent of SS is called the Canadian Pension Plan (CPP). It's 100% fair to say that if you work a standard 40-hour week, even at a minimum wage job, are frugal, save judiciously from the time you enter the workforce, invest your money in safe assets like CDs and GICs, and retire at 65, you will have paid in your entire life to the CPP but won't qualify to get a penny out.
So what happens if you splurge just a bit? Maybe you don't save as much. Make unwise investments. Buy things you shouldn't?
Well, the government is there to make sure you have at least a minimum standard of living, in spite of the fact that you didn't manage your money as well as you could have. But you did make an attempt.
And now suppose you blow it all. Bad investment decisions. Too many kids. A dog you couldn't afford. House a little too big. Clothes a little bit too fancy. But you deserve it, right? You have needs like everybody else. And it's not like you're living it up at the Ritz. You deserve a little bit of pampering now and again.
But lo, you're 65 and broke. Well, the CPP is for you. You get to spend all the money paid in by the people who made wise decisions and who made the sacrifices, and at least some of the money paid in by the people who halfway made sacrifices.
And suppose the bar is raised on means testing as the way to make cuts to the CPP. Well now you not only get to spend the money paid in by the responsible citizens, you get to spend the partly-responsible citizens' share too, while they go and suck an egg, wondering why they were stupid enough to scrimp and save for 40 freaking years just so they could have their support cut and wind up with a standard of living barely higher than yours.
Does that seem fair to you? Does it seem like it encourages thrift, sacrifice, wise investing? Is it just a painless sacrifice for everyone who saved even a little?
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djAdvocate
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Post by djAdvocate on Oct 21, 2013 20:13:42 GMT -5
There is more than an order of magnitude difference in scale, true. what i meant by that is that it is "fixable". it doesn't take any stroke of brilliance to figure out how to do it. everything needed to fix it is already on the table, imo.
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mmhmm
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Post by mmhmm on Oct 21, 2013 20:18:25 GMT -5
Suppose you do make cuts unevenly. I good portion of SS recipients--not all, but a good many--are in a better financial situation because they saved more, they worked longer, they planned for retirement, they made all the necessary sacrifices. By shifting the cuts disproportionately onto this group, you're partly or even completely nullifying the sacrifices they've made. And not only that, you've disincentivized others' making such sacrifices in future. This is seniors and social security to begin with. We're not talking about uber-rich corporate types who can stand to lose a few dollars. The cuts are going to hurt, and they're going to hurt deserving people, means-tested or not. I can stand wealth redistribution to a point, but at some point you've got to stop robbing Peter to pay Paul. SS is not a serious problem imo. MC is another matter, entirely. Unquestionably, dj. The rising cost of medical care is wreaking havoc on Medicare, Medicaid, and the average guy on the street. Somehow, it's got to be brought under control. In the meantime, I wouldn't mind seeing Medicare means tested, as well.
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Post by djAdvocate on Oct 21, 2013 20:36:09 GMT -5
SS is not a serious problem imo. MC is another matter, entirely. Unquestionably, dj. The rising cost of medical care is wreaking havoc on Medicare, Medicaid, and the average guy on the street. Somehow, it's got to be brought under control. In the meantime, I wouldn't mind seeing Medicare means tested, as well. sure, and the same solutions apply- except that with MC, the rates will HAVE TO go up, imo.
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Post by Deleted on Oct 21, 2013 20:48:23 GMT -5
Means-testing would never be a temporary solution. You think they could take money away from high income folks who have "earned" their benefits and then 5-10yrs later take that money back from "working people" to give it back to the "rich"? No way. Means testing is only a permanent solution and is a cop-out.
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Post by djAdvocate on Oct 21, 2013 20:59:50 GMT -5
Means-testing would never be a temporary solution. You think they could take money away from high income folks who have "earned" their benefits and then 5-10yrs later take that money back from "working people" to give it back to the "rich"? No way. Means testing is only a permanent solution and is a cop-out. it changes the nature of the program, as well. because of that, i am not 100% on board with the idea.
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Post by mmhmm on Oct 21, 2013 21:05:37 GMT -5
Means-testing would never be a temporary solution. You think they could take money away from high income folks who have "earned" their benefits and then 5-10yrs later take that money back from "working people" to give it back to the "rich"? No way. Means testing is only a permanent solution and is a cop-out. Frankly, I wouldn't want it to be a temporary solution, and I'd be quite fine with it - not expecting to get anything back.
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Post by Deleted on Oct 21, 2013 21:37:38 GMT -5
so again we get back to the same thing Virgil was saying earlier
some people live frugally, save their ducats, and are responsible
some arent....they overbuy, spend more than they have, and live high on the hog
now 2 couples with exactly the same earnings in their lifetime....say average of 80k annually over 45 years
one has built a nice nest egg from doing all the right things
the second couple doesnt have a proverbial pot to piss in
but you want to take money from the first, and give it to the second?
sounds about right in this screwed up society we now live in....
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Post by djAdvocate on Oct 21, 2013 21:47:37 GMT -5
so again we get back to the same thing Virgil was saying earlier some people live frugally, save their ducats, and are responsible some arent....they overbuy, spend more than they have, and live high on the hog now 2 couples with exactly the same earnings in their lifetime....say average of 80k annually over 45 years one has built a nice nest egg from doing all the right things the second couple doesnt have a proverbial pot to piss in but you want to take money from the first, and give it to the second? assuming their income is the same, no. money would be taken from both (or neither).
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Post by Opti on Oct 21, 2013 22:01:22 GMT -5
"I agree, dj. Both those steps need to be taken. A lot of people who receive SS really don't need it. When I start hearing "I paid into it all those years, I WANT what's MINE!!" it makes me a little sick to my stomach. What the heck does it hurt someone who has more than enough to give something to someone else? That remains a mystery to me."
Yep when it comes to SS and Medicare since it is separate deduction on our paychecks people think that way. Yet very few are agitating for their share of military hardware like a nice airplane or military jeep and we've probably paid as much towards those suckers as SS and Medicare.
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Post by Opti on Oct 21, 2013 22:13:24 GMT -5
"so again we get back to the same thing Virgil was saying earlier
some people live frugally, save their ducats, and are responsible
some arent....they overbuy, spend more than they have, and live high on the hog "
Life is not that binary. Its not either or. In case you or Virgil missed it the world has changed from one job in one's working life to an expected average of 4 careers. Some of us have had more. <Raises hand angrily.>
Some people also get lucky and some get shat upon whether by circumstances planned or unplanned. Living frugally is like eating right and exercising. You have to do it all the time to do it well, but at anytime you can sometimes go off the rails and recover later.
There are an infinite number of possibilites that haven't been stated in G's binary either/or world. <Dials sarcasm meter to 12> Yep, right now according to G I'm living high on the hog because I'm spending more than I have. Funny thing that I can't instantly move to a non-existent affordable apartment the minute my circumstances change, but WTE, why think about RL? Yep, I go to food pantries, am trying to sell stuff to replace my front brakes, and live so low on the hog I have named its belly button. <Dials back sarcam meter to 10 and leaves thread to look for something to kill(metaphorically people, so no dumbass panic, K?>
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Post by tallguy on Oct 21, 2013 22:14:32 GMT -5
so again we get back to the same thing Virgil was saying earlier some people live frugally, save their ducats, and are responsible some arent....they overbuy, spend more than they have, and live high on the hog now 2 couples with exactly the same earnings in their lifetime....say average of 80k annually over 45 years one has built a nice nest egg from doing all the right things the second couple doesnt have a proverbial pot to piss in but you want to take money from the first, and give it to the second? assuming their income is the same, no. money would be taken from both (or neither). I think he is referring to lifetime income history, not current income. In his example, while the two couples had exactly the same earnings year-to-year for their entire lives, one would receive SS while the other would be means-tested out as a result of building a retirement nest egg. The savers would be penalized while the wasters would be rewarded. That is also Virgil's argument. And yes, it strikes me wrong as well. I am not of the opinion that either the tax code or any other system (like SS) should be incentivizing reckless behavior.
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Post by usaone on Oct 21, 2013 22:21:09 GMT -5
Yeah, that's one possibility. Or, anyone with the TEA party tag is about to get their asses handed to them in 2014 except in very very red districts. We'll know in about a year. If nothing else it'll be really interesting to see if a real rift opens up on the conservative side and splits the party. The rhetoric is there right now, but we'll see if it materializes in the primaries and big money. I don't know when was the last time a major party in America split, but it should be interesting to see if it happens. The unfortunate thing for conservatives of course would be that if it does happen it probably guarantees a growing Democrat majority in the Senate, possibly a slim majority in the House, and should give whoever the Dems pick for 2016 a good shot at the presidency. Actually, what's going to happen in 2014 is the GOP is going to get shellacked. They will blame it on the TEA Party, but in reality it will be the consequences of caving on ObamaCare. The reality is that the youth and vitality of the GOP is all TEA Party conservative- as is the youth of the country. This is why the old guard and the Dems are desperately trying to import foreigners to vote. They've aborted their voters. Barring immigration reform, the smart money is on the TEA Party & conservative movement in the next two decades. As the government that promised heaven continues to deliver hell, Americans- who are not fucking FRENCH- will actually turn back to conservative ideas. We're clearly stupid- but we're not quite that stupid. Conservative ideas are proven, they make sense, and when sold instead of compromised on and surrendered- they sell very well. Remember, what I just said in my last post- Reagan's Goldwater speech "A Time For Choosing" was in 1964. He didn't win the nomination until 1980. It may take time, but victory is coming. The Youth and the vitality of the GOP is the Tea Party?? Wow. Have you ever been to a meeting?? It's all white senior citizens.
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Post by Opti on Oct 21, 2013 22:22:14 GMT -5
"one has built a nice nest egg from doing all the right things the second couple doesnt have a proverbial pot to piss in but you want to take money from the first, and give it to the second? sounds about right in this screwed up society we now live in.... " Real life alert. Name one couple you know who does not live on the street in this country and doesn't own/rent a toliet? Two, for bonus points. Real life alert #2. I still own more shit than most people in third world countries or aboriginals who live off the land and leave no pollution and mess behind. In your opinion am I better than them because I own more stuff or is my suckiness relative because my earning/expense ratio doesn't meet with your standard and beliefs? Donald Trump and many eventual successful businessmen and women spent more than they earned, some for years at a time. Yet most celebrate the accomplishments of Trump, Rich Dad, Poor Dad creator, etc. Why isn't Mr. Trump damned forever for living high on the hog on money he didn't have ? Why? <Insert strange rationalization here.>
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Post by Opti on Oct 21, 2013 22:32:15 GMT -5
I see this argument all the time, yet not one person here or on YM has ever decided that bankrupting themselves was a great retirement strategy. SS seems to be biased to income earned in recent years not lifetime income or highest income. My SS estimates have dropped like flung rocks compared to my days of high five figure earnings.
And all savers aren't created equal nor investments. My Mom worked her entire life as a hard-working teacher and she will run out of money if she lives long enough. Probably in 5 years or less if her Alzheimers is one of those long painful ones. The guy who created Kentucky Fried Chicken made it big after his 50s. Some big sports starts literally die close to broke living under bridges despite career earnings that could eat mine for lunch. Life is complex and I don't think SS incentivizses reckless behavior. Unless there's some loop hole y'all know about that I don't. The one that says we don't pay you based on what you earn, but pay you on what you over-spent. Please point it out so I can use it.
TYVM.
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Post by tallguy on Oct 21, 2013 22:43:22 GMT -5
No. Social Security is based off of your 35 highest years of earnings. The estimates you received utilized the assumption that you would continue to earn your most recent wage or salary until full retirement age. With your income dropping from previous years, the assumption changed. Not only do you now have lower earnings years figuring into the calculation but the projection of your earnings until FRA now uses the more recent (lower) number. That is why your estimate has dropped.
The rest of your post is a non sequitur. It does not address the original question which was means-testing based on assets instead of income.
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Post by Angel! on Oct 21, 2013 22:53:05 GMT -5
assuming their income is the same, no. money would be taken from both (or neither). I think he is referring to lifetime income history, not current income. In his example, while the two couples had exactly the same earnings year-to-year for their entire lives, one would receive SS while the other would be means-tested out as a result of building a retirement nest egg. The savers would be penalized while the wasters would be rewarded. That is also Virgil's argument. And yes, it strikes me wrong as well. I am not of the opinion that either the tax code or any other system (like SS) should be incentivizing reckless behavior. I guess it depends on what you consider penalized vs rewarded. The savers will have a nice retirement with a decent standard of living, while the wasters will be living a much lower standard of living. Yes, the wasters get that standard of living covered by the govt, but most people would prefer the higher standard of living and the choices that go along with it. This is basically the same argument people use when talking about welfare programs, yet you don't really see people quiting their jobs just to be rewarded with a few hundred in food stamps and perhaps subsidized housing. The "rewards" are really just a crappy, low, standard of living. Not worth it too most people. I also don't see why any means testing couldn't be done in such a fashion that you never end up with less income by saving more. Say for every extra dollar you withdraw from your retirement accounts you get 20 cents less in SS. So, you could choose to live on just 20K in SS. Or you could choose to withdraw $50K from retirement accounts and get just $10K in SS. Sure you get $10K less in SS, but you are living a $40K/yr better lifestyle and still getting some SS.
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Post by Opti on Oct 21, 2013 23:00:33 GMT -5
I intentionally didn't address the question of means-testing based on assets instead of income. I will address the true original question vis a v the thread title. The Tea party must be doing something right? No. Just No. Crap, those SS things are estimates? Based on assumptions instead of actual existing data as it is now? Double crap. Stoopid government. Damn, I guess its time to win 300 mil or write the equivalent of 50 shades of crap...
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Post by Opti on Oct 21, 2013 23:03:11 GMT -5
Thanks Angel for writing something well thought out and intelligent. I wish it was catching.
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Post by tallguy on Oct 21, 2013 23:31:05 GMT -5
From Virgil's post earlier:
I take him at his word that this is correct, and that they effectively means-test based on assets. He can correct me if I'm wrong, or someone else can research it.
But again, and I am assuming you are talking about withdrawals from tax-deferred plans, the means-testing is based on income, not assets. To view it the other way, think of it like this:
Someone manages to save a million-dollar nest egg. Someone with the exact earnings history spent everything they made and have nothing saved. Both would qualify for SS benefits of $2000/month. The second person gets (and lives off of) that $24,000/year. The first, who perhaps over-reacted to the advice to put everything into safe investments at retirement, has their million in CD's, currently earning about 1%. Their only income is interest at $10,000/year, yet they are precluded from any SS benefits because they have a million sitting in CD's. Yes, they can use part of the million, but should they be required to?
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Post by tallguy on Oct 21, 2013 23:31:47 GMT -5
As do I.
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Post by djAdvocate on Oct 21, 2013 23:34:26 GMT -5
assuming their income is the same, no. money would be taken from both (or neither). I think he is referring to lifetime income history, not current income. i understand that- but if that is the case, then the whole argument is a non-sequitur. we don't tax people on their wealth generating behavior. in fact we give a break to those that have income that comes from investing rather than earning.In his example, while the two couples had exactly the same earnings year-to-year for their entire lives, one would receive SS while the other would be means-tested out as a result of building a retirement nest egg. i am unaware of any plans to have a wealth means-test.The savers would be penalized while the wasters would be rewarded. That is also Virgil's argument. And yes, it strikes me wrong as well. I am not of the opinion that either the tax code or any other system (like SS) should be incentivizing reckless behavior. i don't think anyone had that idea. but perhaps i am mistaken.
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Post by Opti on Oct 21, 2013 23:35:43 GMT -5
?
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Post by tallguy on Oct 21, 2013 23:38:21 GMT -5
I am not aware of any current plan to do it either, but my impression from both Virgil's post and gdgyva's was that that was the point being argued against.
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