4 ms·

That's just not true with regards to Social Security. 100 years of projected life before dragging on other Federal finances and one major reform so far (another

That's just not true with regards to Social Security. 100 years of projected life before dragging on other Federal finances and one major reform so far (another will be needed) is usually the sign of a successful government program. It's not in dire crisis: we will start to see it drag on other government finances in 20 years, as FICA will only fund about 75% of payouts once the trust fund is exhausted. Medicare on the other hand is a different story. Costs are growing too high to make it sustainable. But that doesn't have to do with the efficiency of the program itself vs. other insurance companies - it's actually quite a bit efficient than private insurers. The problem seems to be the broader U.S. system of health cost/benefits compared to other countries. We spend more and get less.

anamax 14y ago
> It's not in dire crisis: we will start to see it drag on other government finances in 20 years, It's actually a drag now, as it has been paying more in benefits than it receives for the past few years. Yes, I know about the bonds. Paying them back is a drag because they weren't used to create profitable assets.
- _delirium 14y ago
  That seems like a problem for the regular budget to sort out: Soc. Sec. basically has the money it needs for some decades, but the rest of the budget either needs significant cuts or tax hikes so that it can pay back Soc. Sec. what it owes it. I don't think it's an acceptable option to retroactively say that some of the Soc. Sec. taxes won't be paid back to Soc. Sec., and just kept for the general fund. If that happened, then it's basically been a regressive income tax all along, contrary to Reagan's assurances in 1983 that he wasn't making a regressive change to the tax code, because of the bonds. If that is likely to happen, then at least the regressiveness should be fixed ASAP by removing the $110k cap, because the only justification for the cap is that the money is earmarked for Social Security.
  - anamax 14y ago
    > I don't think it's an acceptable option to retroactively say that some of the Soc. Sec. taxes won't be paid back to Soc. Sec., I didn't suggest that. I'm just pointing out that the "drag" has already started. > and just kept for the general fund. If that happened, then it's basically been a regressive income tax all along It's not a regressive tax because of the payout is capped too. In fact, it's actually a progressive tax because of the way that payout works. The ROI for folks who pay the minimum is pretty good. The ROI for folks who hit the cap is horrible. That said, some subgroups do worse/better than others. The worst is probably black men. They don't live long enough to get the payouts. I think that white women are the big winners. > If that is likely to happen, then at least the regressiveness should be fixed ASAP by removing the $110k cap, because the only justification for the cap is that the money is earmarked for Social Security. Actually, the designers of SS put in the cap because they thought that it was the best way to protect SS from political fights. Are you planning to remove the benefits cap as well? If not, it's just another tax and rich people are going to care. SS's designers wanted rich people to ignore SS. If you do remove the benefits cap, then you get to explain why Ross Perot gets $400k/year in benefits. I think that SS's designers got that part correct. The payout formula needs some tweaking.
  - anamax 14y ago
    > That seems like a problem for the regular budget to sort out I agree. My point is that the problem exists now. > I don't think it's an acceptable option to retroactively say that some of the Soc. Sec. taxes won't be paid back to Soc. Sec., I didn't suggest default. I'm just pointing out that the "drag" has already started. > and just kept for the general fund. If that happened, then it's basically been a regressive income tax all along It's not a regressive tax because of the payout is capped too. In fact, it's actually a progressive tax because of the way that payout works. The ROI for folks who pay the minimum is pretty good. The ROI for folks who hit the cap is horrible. That said, some subgroups do worse/better than others. The worst is probably black men. They don't live long enough to get the payouts. I think that white women are the big winners. > If that is likely to happen, then at least the regressiveness should be fixed ASAP by removing the $110k cap, because the only justification for the cap is that the money is earmarked for Social Security. Actually, the designers of SS put in the cap because they thought that it was the best way to protect SS from political fights. Are you planning to remove the benefits cap as well? If not, it's just another tax and rich people are going to care. SS's designers wanted rich people to ignore SS. If you do remove the benefits cap, then you get to explain why Ross Perot gets $400k/year in benefits. I think that SS's designers got that part correct. The payout formula needs some tweaking.

anamax 14y ago

> It's not in dire crisis: we will start to see it drag on other government finances in 20 years, It's actually a drag now, as it has been paying more in benefits than it receives for the past few years. Yes, I know about the bonds. Paying them back is a drag because they weren't used to create profitable assets.

_delirium 14y ago
That seems like a problem for the regular budget to sort out: Soc. Sec. basically has the money it needs for some decades, but the rest of the budget either needs significant cuts or tax hikes so that it can pay back Soc. Sec. what it owes it. I don't think it's an acceptable option to retroactively say that some of the Soc. Sec. taxes won't be paid back to Soc. Sec., and just kept for the general fund. If that happened, then it's basically been a regressive income tax all along, contrary to Reagan's assurances in 1983 that he wasn't making a regressive change to the tax code, because of the bonds. If that is likely to happen, then at least the regressiveness should be fixed ASAP by removing the $110k cap, because the only justification for the cap is that the money is earmarked for Social Security.
- anamax 14y ago
  > I don't think it's an acceptable option to retroactively say that some of the Soc. Sec. taxes won't be paid back to Soc. Sec., I didn't suggest that. I'm just pointing out that the "drag" has already started. > and just kept for the general fund. If that happened, then it's basically been a regressive income tax all along It's not a regressive tax because of the payout is capped too. In fact, it's actually a progressive tax because of the way that payout works. The ROI for folks who pay the minimum is pretty good. The ROI for folks who hit the cap is horrible. That said, some subgroups do worse/better than others. The worst is probably black men. They don't live long enough to get the payouts. I think that white women are the big winners. > If that is likely to happen, then at least the regressiveness should be fixed ASAP by removing the $110k cap, because the only justification for the cap is that the money is earmarked for Social Security. Actually, the designers of SS put in the cap because they thought that it was the best way to protect SS from political fights. Are you planning to remove the benefits cap as well? If not, it's just another tax and rich people are going to care. SS's designers wanted rich people to ignore SS. If you do remove the benefits cap, then you get to explain why Ross Perot gets $400k/year in benefits. I think that SS's designers got that part correct. The payout formula needs some tweaking.
- anamax 14y ago
  > That seems like a problem for the regular budget to sort out I agree. My point is that the problem exists now. > I don't think it's an acceptable option to retroactively say that some of the Soc. Sec. taxes won't be paid back to Soc. Sec., I didn't suggest default. I'm just pointing out that the "drag" has already started. > and just kept for the general fund. If that happened, then it's basically been a regressive income tax all along It's not a regressive tax because of the payout is capped too. In fact, it's actually a progressive tax because of the way that payout works. The ROI for folks who pay the minimum is pretty good. The ROI for folks who hit the cap is horrible. That said, some subgroups do worse/better than others. The worst is probably black men. They don't live long enough to get the payouts. I think that white women are the big winners. > If that is likely to happen, then at least the regressiveness should be fixed ASAP by removing the $110k cap, because the only justification for the cap is that the money is earmarked for Social Security. Actually, the designers of SS put in the cap because they thought that it was the best way to protect SS from political fights. Are you planning to remove the benefits cap as well? If not, it's just another tax and rich people are going to care. SS's designers wanted rich people to ignore SS. If you do remove the benefits cap, then you get to explain why Ross Perot gets $400k/year in benefits. I think that SS's designers got that part correct. The payout formula needs some tweaking.