Interesting Article on Social Security

[Politically_Incorrect12]

I think the general idea behind the 2% reduction was in hopes of people just spending the money to stimulate the economy. I have no idea how well it will work.

[Savoir Faire-Demogague in NJ]

Is that 2% going into a privatized account?

The 2% SS tax reduction has no strings or restrictions attached. I am just saying, theoretically the govt is sort of doing this already, at least for 2011. I am already maxing all my retirement options that I have. I also imagine, the uninformed are speding up a storm with this money and building it into their budgets. Next year when the 2% gets added back in, there will be lots of whining and squeeling....

My guess is that at some income level, you would max out your benefits.

I agree with your guess.

I meant my remarks as more sarcastic toward all the people who complain about the markets being too unreliable while the government could and are considering changing the rules. We could start by offering the same funds as those available through the TSP accounts offered to government employees.

Got it.

[Bluerobin]

SF, there is a max benefit, so eliminating the cap would just put the burden on the wealthy. Don't marry the GF, you will get more $ in the end.

[Savoir Faire-Demogague in NJ]

I think the general idea behind the 2% reduction was in hopes of people just spending the money to stimulate the economy. I have no idea how well it will work.

Yeah, that is the theory as far as I can tell.

[Savoir Faire-Demogague in NJ]

SF, there is a max benefit, so eliminating the cap would just put the burden on the wealthy. Don't marry the GF, you will get more $ in the end.

ROFLMAO.... We've only been dating for about 2 1/2 months... I may have no choice... she might kick my butt...LOL

[Politically_Incorrect12]

Mar 11, 2011 10:00:27 GMT -5 Savoir Faire-Demogague in NJ said:

Is that 2% going into a privatized account?

The 2% SS tax reduction has no strings or restrictions attached. I am just saying, theoretically the govt is sort of doing this already, at least for 2011. I am already maxing all my retirement options that I have. I also imagine, the uninformed are speding up a storm with this money and building it into their budgets. Next year when the 2% gets added back in, there will be lots of whining and squeeling....

My guess is that at some income level, you would max out your benefits.

I agree with your guess.

I wouldn't be surprised if they kept the current max close to what it is now, even while taking the income limit off of what can be taxed. As far as the extra 2% being added into budgets, I agree and it is likely to be an election year topic.

[Bluerobin]

2% will stimulate. It is too small to do anything else with.

[Savoir Faire-Demogague in NJ]

I wouldn't be surprised if they kept the current max close to what it is now, even while taking the income limit off of what can be taxed.

Removing the income cap will not raise sufficient amounts of money. We are talking 10s of trillions in needed revenue.
Thinking that money will be raised by taxing those earning $1 million annually if a fools game. People earning that much usually have most of it in investment income.
Conversely, this will hurt the middle class the most as they will see their taxable accounts and interest income returns fall by 6%

[Politically_Incorrect12]

Mar 11, 2011 10:06:13 GMT -5 Bluerobin said:

2% will stimulate. It is too small to do anything else with.

Or maybe it's enough to cover the increase in gas prices.

[Savoir Faire-Demogague in NJ]

Or maybe it's enough to cover the increase in gas prices

Interestingly enough, the Fed pumping a few trillion into the economy via QEI and QEII is likely more responble for the rise in oil prices.

[Bluerobin]

SF, I saw a study somewhere that indicated eliminating the cap would make SS whole.
Get used to the idea, There is NO middle class, only upper and lower poor class and the wealthy.

[Deleted]

They should just do what the dude in the article suggests. Increase the retirement age and reduce benefits for the wealthy either directly or by increasing the taxable portion of the benefits

[Politically_Incorrect12]

Mar 11, 2011 10:10:47 GMT -5 Savoir Faire-Demogague in NJ said:

I wouldn't be surprised if they kept the current max close to what it is now, even while taking the income limit off of what can be taxed.

Removing the income cap will not raise sufficient amounts of money. We are talking 10s of trillions in needed revenue.
Thinking that money will be raised by taxing those earning $1 million annually if a fools game. People earning that much usually have most of it in investment income.
Conversely, this will hurt the middle class the most as they will see their taxable accounts and interest income returns fall by 6%

I am simply saying that if there ever was a bill passed that took away the cap limit, there would likely be provisions which prevent the maximum benefit from increasing very much. So in essence, if they took the SS income tax cap off, they would say something like a person reaches their max potential benefit at $150k. The argument would likely be used that people making over that should be able to save more for retirement and should be happy they are making that much money (similar to the same argument used for why people should be happy to pay 40% of more of their income to taxes). While anybody making over that would receive nothing in benefits over that amount and still have to pay taxes on it. Of course this is not even considering the increase in taxes on businesses who pay half of the total SS benefit amount for their employees.

[Deleted]

Mar 11, 2011 10:13:04 GMT -5 Bluerobin said:

SF, I saw a study somewhere that indicated eliminating the cap would make SS whole.
Get used to the idea, There is NO middle class, only upper and lower poor class and the wealthy.

ROFL. we have the biggest middle class in the history of the world. China may overtake us, but not yet.

[Savoir Faire-Demogague in NJ]

The argument would likely be used that people making over that should be able to save more for retirement and should be happy they are making that much money (similar to the same argument used for why people should be happy to pay 40% of more of their income to taxes).

That would turn the SS system into merely an entitlement program, with caps, limits, income levels susceptible to the whims of congress, at the expense of the middle class.
A $150K income is purely an average middle class, two income family... with two earners working in average middle class jobs...ie: accounting, IT, finance, payroll, payables, production, inventory, shipping, etc...
Not arguing, just pointing out the flaws.

PS: furthermore, while the middle class can save a lot in retirement accounts, it has already been bandied about to levy wealth taxes on retirement assets....

[Bluerobin]

Arch, just continue to believe you are middle class if it makes you feel better. I know I am poor and soon to be on a "fixed" income.
The article I saw also suggested means testing for the wealthy.

[Savoir Faire-Demogague in NJ]

ROFL. we have the biggest middle class in the history of the world. China may overtake us, but not yet.

Yeah, that is a ROFL-er.... Venezuela had the largest middle class in Latin America, then Chavez was put in power and implemented a massive weatlh redistribution program. Eleven years later, Venezuela is an economic laughing stock now.

[Savoir Faire-Demogague in NJ]

Arch, just continue to believe you are middle class if it makes you feel better. I know I am poor and soon to be on a "fixed" income.
The article I saw also suggested means testing for the wealthy.


Means testing will only damage the retirement plans of the middle class.

[Deleted]

Mar 11, 2011 10:30:45 GMT -5 Bluerobin said:

Arch, just continue to believe you are middle class if it makes you feel better. I know I am poor and soon to be on a "fixed" income.
The article I saw also suggested means testing for the wealthy.

I am upper middle class, verging on wealthy. I live the good life.

[Deleted]

Mar 11, 2011 10:30:58 GMT -5 Savoir Faire-Demogague in NJ said:

ROFL. we have the biggest middle class in the history of the world. China may overtake us, but not yet.

Yeah, that is a ROFL-er.... Venezuela had the largest middle class in Latin America, then Chavez was put in power and implemented a massive weatlh redistribution program. Eleven years later, Venezuela is an economic laughing stock now.

I don't know much about Venezuela. I know that the USA has the largest middle class in the history of the world and that is not likely to change in the near future.

[Politically_Incorrect12]

Mar 11, 2011 10:28:01 GMT -5 Savoir Faire-Demogague in NJ said:

The argument would likely be used that people making over that should be able to save more for retirement and should be happy they are making that much money (similar to the same argument used for why people should be happy to pay 40% of more of their income to taxes).

That would turn the SS system into merely an entitlement program, with caps, limits, income levels susceptible to the whims of congress, at the expense of the middle class.
A $150K income is purely an average middle class, two income family... with two earners working in average middle class jobs...ie: accounting, IT, finance, payroll, payables, production, inventory, shipping, etc...
Not arguing, just pointing out the flaws.

PS: furthermore, while the middle class can save a lot in retirement accounts, it has already been bandied about to levy wealth taxes on retirement assets....

I disagree with the whole premise of increasing the SS cap to unlimited, but was just pointing out what I think would happen if caps were removed. People paying more wouldn't get much more, if anything compared to the current benefits; but will have to pay the extra taxes on it.

[Savoir Faire-Demogague in NJ]

I am upper middle class, verging on wealthy. I live the good life.

Oh brother....

[floridayankee]

Mar 10, 2011 22:28:38 GMT -5 ArchietheDragon said:

"The commission, co-chaired by Bowles, President Clinton’s former chief of staff, and former Senate Republican Whip Alan Simpson, recommended slowing the future growth of Social Security retirement benefits, particularly for higher earners, increasing taxes on higher earners, and raising the eligibility age for collecting benefits, except for workers with physically demanding jobs."

Well giddyup... what is so hard (other than the political ramification from some baby boomer crybabies) about doing this?

Hmmmm...sounds a lot like what the WI governor is trying to do...take away goodies that were promised by politicos many years ago to attempt some semblance of a balanced budget.

I'd suspect we'll see the liberals protesting outside the WH any minute.

yup....any......minute......now.......

[floridayankee]

Mar 11, 2011 9:30:25 GMT -5 Politically_Incorrect12 said:

So pay more, get less in benefits for a shorter amount of time, but don't even mention privatizing a portion of it because the stock market is just too risky to put funds into since they aren't guaranteed? By the way, I'm not even close to being a Boomer.

Yeah...sounds like a great deal, eh?

It leaves one wondering...where, exactly, is the security in social security?

[Deleted]

Another cry baby boomer... FY, I thought you were different.

[Savoir Faire-Demogague in NJ]

It leaves one wondering...where, exactly, is the security in social security?

My point exactly.

[Savoir Faire-Demogague in NJ]

Another cry baby boomer... FY, I thought you were different.

Boomers like FY and I, are using SS the way it was intended, a three legged stool to fund retirement.
Living within our means, saving money in taxable and retirement plans...perhaps a small pension, etc. SS is the third leg.

[floridayankee]

Mar 11, 2011 10:50:04 GMT -5 ArchietheDragon said:

Another cry baby boomer... FY, I thought you were different.

Sorry but I'm not a boomer Archie...plenty of working years ahead of me and far from being part of the evil elite (like you are ). I simply disagree with idea of removing a cap to force the "evil rich folks" pay more into a failing government retirement benefits program and then turn around and means test them out of any benefits.

Why not make the theft more action packed and news worthy? Load up the SWAT team, swoop in from all angles in the middle of the night, hold a gun to the rich bastard's head and demand he give up the combo to the safe rather than hiding behind the veil of "social security".

[floridayankee]

Mar 11, 2011 11:07:52 GMT -5 Savoir Faire-Demogague in NJ said:

Another cry baby boomer... FY, I thought you were different.

Boomers like FY and I, are using SS the way it was intended, a three legged stool to fund retirement.
Living within our means, saving money in taxable and retirement plans...perhaps a small pension, etc. SS is the third leg.

Gen X'er if you really have to put a label on it SF. The rest of your post is spot on though (even though I started the savings part pretty late).

[Deleted]

Mar 11, 2011 11:07:56 GMT -5 floridayankee said:

Mar 11, 2011 10:50:04 GMT -5 ArchietheDragon said:

Another cry baby boomer... FY, I thought you were different.

Sorry but I'm not a boomer Archie...plenty of working years ahead of me and far from being part of the evil elite (like you are ). I simply disagree with idea of removing a cap to force the "evil rich folks" pay more into a failing government retirement benefits program and then turn around and means test them out of any benefits.

Why not make the theft more action packed and news worthy? Load up the SWAT team, swoop in from all angles in the middle of the night, hold a gun to the rich bastard's head and demand he give up the combo to the safe rather than hiding behind the veil of "social security".

]

I don't think they should lift the cap, either. A few small changes will go a long, long way in fixing SS, which, in fact, isn't broken until 2037, which was really the point of the article.

But I don't agree that we should wait until it is broken to fix it.. have we learned nothing>?