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> The poor tend not to go to college, so they start paying earlier. They also work hard labor so they die earlier, meaning they collect for fewer years. Both o

> The poor tend not to go to college, so they start paying earlier. They also work hard labor so they die earlier, meaning they collect for fewer years. Both of these issues would exist with any retirement vehicle, public or private, so singling out a public retirement vehicle for criticism doesn't make much sense. (The astute might even notice that singling out the problems in public institutions without considering their private analog was the same blind spot in your original comment.) That said, it is worth noting that as a flat tax (with a ceiling), FICA taxes are in fact a regressive tax scheme (as are sales taxes) -- something to keep in mind the next time flat taxes are floated as a good idea for income taxes in general. Whether that means the overall tax burden (vs program benefits) is regressive is less clear, given the somewhat progressive nature of the rest of the income tax structure. But I might well agree that problems with a public retirement vehicle would be worth addressing in public policy, so to the extent that it can be established that the overall burden is regressive, sure, I'd be supportive of changes that would make it more progressive. Maybe we could look at capital gains tax rates, which I'm sure you're also concerned about, given how important regressive redistribution is to you.

Consultant32452 9y ago
>Both of these issues would exist with any retirement vehicle, public or private In a private system they have the capability of accumulating generational wealth. In the public system they do not. > sure, I'd be supportive of changes that would make it more progressive. Are you going to be supportive of the types of changes that would allow poor people to accumulate private wealth that they could pass onto their children so that their children are less likely to follow the same fate of hard labor and early death? Or is your goal to keep them under your thumb, poor, and beholden to the state? >Maybe we could look at capital gains tax rates, which I'm sure you're also concerned about, given how important regressive redistribution is to you. Short term capital gains tax rates are the same as income tax rates. You just don't pay FICA (SS, Medicare). My preference would be to remove the FICA from the rest of your income, bringing income taxes and capital gains taxes into parity. Long term capital gains are lower. I'm open to bringing that into parity with short term capital gains and regular income tax. The result of that would likely be more retail stock speculation by the relatively uneducated investor. But I'm not particularly concerned about that.
- wwweston 9y ago
  > In a private system they have the capability of accumulating generational wealth. In the public system they do not. How sure are you about this? "Social Security already provides an inheritance benefit in the form of survivors benefits, which account for nearly one-fifth of all benefits that Social Security pays. When a worker dies, Social Security pays survivors benefits for a number of years to the worker’s minor children as well as to the worker’s spouse if the spouse is raising children who are under 16 or the spouse is 60 or older.[1] The Social Security actuaries have reported that for a typical family with two young children in which a worker dies before reaching retirement age, the survivors benefits can be the equivalent of inheriting $400,000, a much larger sum than most workers could accumulate in a private account." https://www.cbpp.org/research/social-security-and-inheritance https://www.cbpp.org/research/social-security-and-inheritanc... > Or is your goal to keep them under your thumb, poor, and beholden to the state? Do you really want to bring questions about our motives into the scope of discussion? I don't usually find that a productive line of conversation. And at this point, looking back over the discussion, what do you think a perceptive audience is more likely to believe: that my goal is sinister enslavement via social security check, or that your championing of an entirely privatized retirement system owes more to some other motive than concern for the struggles of manual laborers? > My preference would be to remove the FICA from the rest of your income, bringing income taxes and capital gains taxes into parity. FICA taxes don't have to be gospel. The question is how you're going to replace the revenue they provide for Social Security and Medicare, or if not that, with the opportunity that revenue funds. Perhaps you could do it by raising long term capital gains taxes. But if the line of discussion points towards elimination of those programs, well, so far, I haven't seen any credible evidence or argument that if we eliminate SS+MC, the people for whom those specific taxes turn out to be regressive would have the opportunity to get a hold of a vehicle that would provide better benefits/returns, not to mention the balance of incentives to put money into it. I think it's likely enough concerns about any regressive side to those taxes are better addressed by considering how the rest of the income tax code is (or might be) progressive and in the quality of the public benefits. Or bringing the bracket system to that side. Or holidays like the one in Tax Relief Act of 2010. Really, there's a lot of tools in the box.
  - 9y ago

Consultant32452 9y ago

>Both of these issues would exist with any retirement vehicle, public or private In a private system they have the capability of accumulating generational wealth. In the public system they do not. > sure, I'd be supportive of changes that would make it more progressive. Are you going to be supportive of the types of changes that would allow poor people to accumulate private wealth that they could pass onto their children so that their children are less likely to follow the same fate of hard labor and early death? Or is your goal to keep them under your thumb, poor, and beholden to the state? >Maybe we could look at capital gains tax rates, which I'm sure you're also concerned about, given how important regressive redistribution is to you. Short term capital gains tax rates are the same as income tax rates. You just don't pay FICA (SS, Medicare). My preference would be to remove the FICA from the rest of your income, bringing income taxes and capital gains taxes into parity. Long term capital gains are lower. I'm open to bringing that into parity with short term capital gains and regular income tax. The result of that would likely be more retail stock speculation by the relatively uneducated investor. But I'm not particularly concerned about that.

wwweston 9y ago
> In a private system they have the capability of accumulating generational wealth. In the public system they do not. How sure are you about this? "Social Security already provides an inheritance benefit in the form of survivors benefits, which account for nearly one-fifth of all benefits that Social Security pays. When a worker dies, Social Security pays survivors benefits for a number of years to the worker’s minor children as well as to the worker’s spouse if the spouse is raising children who are under 16 or the spouse is 60 or older.[1] The Social Security actuaries have reported that for a typical family with two young children in which a worker dies before reaching retirement age, the survivors benefits can be the equivalent of inheriting $400,000, a much larger sum than most workers could accumulate in a private account." https://www.cbpp.org/research/social-security-and-inheritance https://www.cbpp.org/research/social-security-and-inheritanc... > Or is your goal to keep them under your thumb, poor, and beholden to the state? Do you really want to bring questions about our motives into the scope of discussion? I don't usually find that a productive line of conversation. And at this point, looking back over the discussion, what do you think a perceptive audience is more likely to believe: that my goal is sinister enslavement via social security check, or that your championing of an entirely privatized retirement system owes more to some other motive than concern for the struggles of manual laborers? > My preference would be to remove the FICA from the rest of your income, bringing income taxes and capital gains taxes into parity. FICA taxes don't have to be gospel. The question is how you're going to replace the revenue they provide for Social Security and Medicare, or if not that, with the opportunity that revenue funds. Perhaps you could do it by raising long term capital gains taxes. But if the line of discussion points towards elimination of those programs, well, so far, I haven't seen any credible evidence or argument that if we eliminate SS+MC, the people for whom those specific taxes turn out to be regressive would have the opportunity to get a hold of a vehicle that would provide better benefits/returns, not to mention the balance of incentives to put money into it. I think it's likely enough concerns about any regressive side to those taxes are better addressed by considering how the rest of the income tax code is (or might be) progressive and in the quality of the public benefits. Or bringing the bracket system to that side. Or holidays like the one in Tax Relief Act of 2010. Really, there's a lot of tools in the box.
- 9y ago