How to Fix Social Security

[Schneed10]

Originally Posted by mheisig

So it's the government's job to make sure irresponsible people don't experience the consequences of their irresponsible actions? More precisely, it's MY money that has to ensure that these people never face the consequences of their irresponsible actions.

Correction, it's your money that's serving as an INVESTMENT in your own, and the country's, future to ensure that your grandchildren have the same decent shot at a decent paying job just as you do now. Because if you don't make that investment, your grandkids will find it very hard to find work.

Such is the way economics works. Sometimes making investments isn't about gaining a return on investment, sometimes it's about avoiding losses.

[mheisig]

Originally Posted by Schneed10

Correction, it's your money that's serving as an INVESTMENT in your own, and the country's, future to ensure that your grandchildren have the same decent shot at a decent paying job just as you do now. Because if you don't make that investment, your grandkids will find it very hard to find work.

Such is the way economics works. Sometimes making investments isn't about gaining a return on investment, sometimes it's about avoiding losses.

How does paying for someone else's future retirement ensure that my grandkids can find a job 40 years from now?

I'm not being facetious, I honestly want to know.

[Schneed10]

Originally Posted by mheisig

How does paying for someone else's future retirement ensure that my grandkids can find a job 40 years from now?

I'm not being facetious, I honestly want to know.

Too many Americans will fail to save enough for themselves. They'll then be forced to remain in the workforce until they're 80 or dead, which will take up more jobs, leaving fewer jobs for those under 65, resulting in much higher unemployment rates and much lower productivity and hence GDP. Not having some sort of organized retirement system would be a social and economic disaster.

From a philosophical standpoint, I'm 100% in agreement with you. But if there's no program to support the working poor in old age, they'll stay in the workforce longer and longer.

[firstdown]

Originally Posted by Schneed10

Too many Americans will fail to save enough for themselves. They'll then be forced to remain in the workforce until they're 80 or dead, which will take up more jobs, leaving fewer jobs for those under 65, resulting in much higher unemployment rates and much lower productivity and hence GDP. Not having some sort of organized retirement system would be a social and economic disaster.

From a philosophical standpoint, I'm 100% in agreement with you. But if there's no program to support the working poor in old age, they'll stay in the workforce longer and longer.

Well if the working poor keeps working longer in the job that made them pore tha all the low paying jobs will be taken so they will have to find better jobs. So it really solves two problems.

[Schneed10]

Originally Posted by firstdown

Well if the working poor keeps working longer in the job that made them pore tha all the low paying jobs will be taken so they will have to find better jobs. So it really solves two problems.

How can a job make someone poor??? Even if it pays $7.50 an hour, it still gives you more money than you would otherwise have if you were unemployed.

It doesn't solve anything, you're making no sense. If more low-level jobs are taken up by the working poor in their old age, there will be fewer low-level jobs for younger people. They will either be squeezed out of a job altogether, or they'll have to seek a higher-level white collar job. Unless they're college graduates, which most of the working poor are NOT, they will have a significantly harder time finding a job that matches their skill level.

Plus, employers will realize that they can hire a cashier who's 24 and get rid of the geezer who's 76. The 76 year old will then be out on the street seeking a job, and tell me who will prefer him over a younger person?

It will cause absurd problems in the job market. I can't figure out what the hell you're talking about.

[firstdown]

Originally Posted by Schneed10

How can a job make someone poor??? Even if it pays $7.50 an hour, it still gives you more money than you would otherwise have if you were unemployed.

It doesn't solve anything, you're making no sense. If more low-level jobs are taken up by the working poor in their old age, there will be fewer low-level jobs for younger people. They will either be squeezed out of a job altogether, or they'll have to seek a higher-level white collar job. Unless they're college graduates, which most of the working poor are NOT, they will have a significantly harder time finding a job that matches their skill level.

Plus, employers will realize that they can hire a cashier who's 24 and get rid of the geezer who's 76. The 76 year old will then be out on the street seeking a job, and tell me who will prefer him over a younger person?

It will cause absurd problems in the job market. I can't figure out what the hell you're talking about.

Maybe your on to something. Like finding higher paying jobs and maybe staying in school a little longer and if they decide to quite school then that is really their decision.

[GTripp0012]

Originally Posted by Schneed10

How can a job make someone poor??? Even if it pays $7.50 an hour, it still gives you more money than you would otherwise have if you were unemployed.

It doesn't solve anything, you're making no sense. If more low-level jobs are taken up by the working poor in their old age, there will be fewer low-level jobs for younger people. They will either be squeezed out of a job altogether, or they'll have to seek a higher-level white collar job. Unless they're college graduates, which most of the working poor are NOT, they will have a significantly harder time finding a job that matches their skill level.

Plus, employers will realize that they can hire a cashier who's 24 and get rid of the geezer who's 76. The 76 year old will then be out on the street seeking a job, and tell me who will prefer him over a younger person?

It will cause absurd problems in the job market. I can't figure out what the hell you're talking about.

If a statistically significant supply of poor elderly workers arises, won't businesses respond by creating more low cost jobs that can be filled by this skill set? Isn't that what economic theory suggests?

If we have a seemingly endless supply of the elderly willing to work for minimum wage to support their retirement, that seems like it would be economically beneficial.

On a humanitarian standpoint, that's probably a less-than-ideal way to finish ones working years, but at least it would serve as a model situation to be avoided for younger generations.

[Schneed10]

Originally Posted by GTripp0012

If a statistically significant supply of poor elderly workers arises, won't businesses respond by creating more low cost jobs that can be filled by this skill set? Isn't that what economic theory suggests?

If we have a seemingly endless supply of the elderly willing to work for minimum wage to support their retirement, that seems like it would be economically beneficial.

On a humanitarian standpoint, that's probably a less-than-ideal way to finish ones working years, but at least it would serve as a model situation to be avoided for younger generations.

No, that's not what it suggests. Businesses will only add those employees if they think that consumers show a DEMAND for new products/services. If the demand is not there, there is no incentive to add workers.

[mheisig]

Originally Posted by Schneed10

Too many Americans will fail to save enough for themselves. They'll then be forced to remain in the workforce until they're 80 or dead, which will take up more jobs, leaving fewer jobs for those under 65, resulting in much higher unemployment rates and much lower productivity and hence GDP. Not having some sort of organized retirement system would be a social and economic disaster.

From a philosophical standpoint, I'm 100% in agreement with you. But if there's no program to support the working poor in old age, they'll stay in the workforce longer and longer.

Why are we assuming that the people who failed to plan for retirement will still be in the workforce at the age of 80, whether they want/need to or not?

Medical, health and emotional issues will weed out a substantial number, and age discrimination aside, companies will find ways to get rid of them.

The fundamental problem with providing for these people is it kills of incentive. What's the incentive to live responsibly and manage your money wisely if the government will bail me out regardless of what I do?

Maybe if people could look ahead and see that they'll be living on the street at 70 if they don't plan ahead they'll have some incentive to manage their finances responsibly.

[Schneed10]

Originally Posted by mheisig

Why are we assuming that the people who failed to plan for retirement will still be in the workforce at the age of 80, whether they want/need to or not?

Medical, health and emotional issues will weed out a substantial number, and age discrimination aside, companies will find ways to get rid of them.

The fundamental problem with providing for these people is it kills of incentive. What's the incentive to live responsibly and manage your money wisely if the government will bail me out regardless of what I do?

Maybe if people could look ahead and see that they'll be living on the street at 70 if they don't plan ahead they'll have some incentive to manage their finances responsibly.

Doesn't have to be age 80, I was just throwing out a number. Make it age 70 (an age a majority of Americans live to). Many of them will be in the workforce because they HAVE to be. They'll have no other way to sustain themselves than to seek a job that provides the bare essential needs (food, shelter, heat, water).

I agree on your point about incentive, you can still build incentive into this program. Please don't mistake me for someone who thinks the current system is any good. It's not, it's horrible. The only thing worse than this system would be having no system at all. That's the part where I'm calling for change - force people to contribute a minimum amount to a low-risk portfolio consisting largely of bonds - but give them options to contribute more if they wish. And on the extra contributions, give people a choice of what to invest in (stocks, bonds, real estate trusts, international stocks, etc.). With this type of program, everyone still contributes a minimum amount, just enough to sustain them in old age. But it also affords everyone the opportunity to control their destiny, and thus enhances the incentive you speak of.

In other words, you need to provide those with half a brain the opportunity to be incented. Those without half a brain will not take advantage of any incentive, no matter how delicious that carrot might look to a reasonable person. Those people still need to be hand-held to an extent, or our economy will suffer in the long run. You need a hybrid model.

[firstdown]

Originally Posted by Schneed10

Correction, it's your money that's serving as an INVESTMENT in your own, and the country's, future to ensure that your grandchildren have the same decent shot at a decent paying job just as you do now. Because if you don't make that investment, your grandkids will find it very hard to find work.

Such is the way economics works. Sometimes making investments isn't about gaining a return on investment, sometimes it's about avoiding losses.

Hey you may want to send that line to the Dem. party. Its not about saving for your future its about jobs for your grandkids and you don't want to starve your grandkids. You also assume that there would be a flood of people having to work longer in life. I could retire about 6 to 7 years earlier and I bet over half of Americans could retire at an earlier time.

[Schneed10]

Originally Posted by firstdown

Hey you may want to send that line to the Dem. party. Its not about saving for your future its about jobs for your grandkids and you don't want to starve your grandkids. You also assume that there would be a flood of people having to work longer in life. I could retire about 6 to 7 years earlier and I bet over half of Americans could retire at an earlier time.

Retire earlier without a social security program in place? I guess you're assuming instead of paying those taxes, you'd sock the money away in retirement funds allowing you to earn a better rate of return than you'd get by paying into social security?

Firstdown, you really need to explain yourself better. You leave me guessing at what you're talking about.

If that's what you mean, the number of working poor staying in the workforce well beyond 65 will greatly outnumber those who can retire early, I can guarantee you that. American citizens are not a financially savvy group.

[firstdown]

Originally Posted by Schneed10

Retire earlier without a social security program in place? I guess you're assuming instead of paying those taxes, you'd sock the money away in retirement funds allowing you to earn a better rate of return than you'd get by paying into social security?

Firstdown, you really need to explain yourself better. You leave me guessing at what you're talking about.

If that's what you mean, the number of working poor staying in the workforce well beyond 65 will greatly outnumber those who can retire early, I can guarantee you that. American citizens are not a financially savvy group.

First off I've never said doing away with the 12% that people and employees but into SS. I say let people decide how to invest the money or let local goverment handle the issue. I just know that our current system doe not work. If you can look at these chart and say SS is the best way then there's no reason to discuss this.Chart 4 [Mackinac Center for Public Policy]

Also nothice that they retire making MORE money than when they worked.

[Schneed10]

Originally Posted by firstdown

First off I've never said doing away with the 12% that people and employees but into SS. I say let people decide how to invest the money or let local goverment handle the issue. I just know that our current system doe not work. If you can look at these chart and say SS is the best way then there's no reason to discuss this.Chart 4 [Mackinac Center for Public Policy]

Also nothice that they retire making MORE money than when they worked.

If that's your stance, then you and I are in complete 100% agreement.

I just took issue with your suggestion that going without a program entirely wouldn't be a problem economically down the road.

[firstdown]

Originally Posted by Schneed10

If that's your stance, then you and I are in complete 100% agreement.

I just took issue with your suggestion that going without a program entirely wouldn't be a problem economically down the road.

Funny how we could discuss this and it took that long to figure we where on the same page.