SS dies in 2017??!

[Partha]

Sure - if you want to change the entire purpose of it from a small means of security to a lottery.

[Embar Angylwrath]

Your position that 401(k)s are lotteries really shows how financially ignorant you are. Hate to break it to ya, but mattress stuffing ain't a sound financial strategy. You obviously have no clue about risk diversification, pooled accounts or money management, and your tendency to view anything in the financial world as hucksterism really puts you outside of any real understanding of how investments work.

In short, financial discussions that involve anything other than your tired "take from rich give to poor" solution to all economic questions cause you to short circuit. You're 64K in a world of megabytes.

[Partha]

Social Security was never meant to be a retirement egg, Embar. It was never meant to be an investment vehicle. You want to change the entire premise of it for the (dubious) idea that people won't get shafted...even though the average American isn't given a decent economic education to begin with, and you'll be putting that 'Security' in the hands of people who aren't elected and have no interest in making sure it grows like you think it should.

If '64K in a world of megabytes' means not trusting the folks who gave us junk bonds, S&L defaults, and subprime mortgages being bundled, then I'm proud to wear that badge. You don't care because you've got yours...typical Republican.

[Embar Angylwrath]

Social Security was never meant to be a retirement egg, Embar. It was never meant to be an investment vehicle. You want to change the entire premise of it for the (dubious) idea that people won't get shafted...even though the average American isn't given a decent economic education to begin with, and you'll be putting that 'Security' in the hands of people who aren't elected and have no interest in making sure it grows like you think it should.

If '64K in a world of megabytes' means not trusting the folks who gave us junk bonds, S&L defaults, and subprime mortgages being bundled, then I'm proud to wear that badge. You don't care because you've got yours...typical Republican.

Are you saying that all those Americans who invested in 401(k)s were hoodwinked? Are they worse off now than they were when they stuffed money in the mattress?

Yes or no? Don't try your typical dodge please. Are 401(k)s just hucksterism?

[Partha]

No, they are no more hucksterism than any other financial vehicle. However, there are many ways for unscrupulous managers to take money out of the system - larger fees, charging non-employees for keeping their plan in the system, limiting rollover options - not to mention the fact that stocks can lose money just as well as gain it. What do you suppose a Bear Stearns 401k is worth at the minute, Embar? I won't even mention what'll happen to the market as all those people with 401ks now are bound by law to cash them out at 70....

[Embar Angylwrath]

Trying to use Bear Sterns as THE reason why we shouldn't consider some sort of privatization is dishonest. Most of America has done very well by 401(k)s, and there is no indication they won't continue to do well.

Now, imagine a good portion of the SS money in semi-privatized, pooled accounts. And by pooled, I mean that there aren't "individual" accounts like 401(k)s, rather pooled segments of the entire SS portion deposited in investment vehicles. Even if some of the pooled accounts lost money, overall, the diversification of the aggregate would counter the risk, just as 401(k)s do.

Then add some regulatory oversight to the mix, and restrict the types of funds the money can be placed in, cap the fees and maybe put some restrictions on the churn (or at least don't pay for the trades) and I think it could be a real good solution to the SS question.

[Kulaf]

I could very easily see a hybrid system. Something where early in your life the system allows you total freedom to invest your SS monies as you see fit. Then.....say arbitraily within 15 years of the minimum SS retirement age.....the government steps back in and takes total control of your fund and secures it so nothing can disrupt your near retirement. This would stop people from being perhaps too overly agressive as they reach retirement age and losing a lot of their investment in the final few years.

[Ddrak]

SS makes no sense and never did make any sense now that I understand the fact it's all invested in T-bills. It's simply the government investing in itself, then spending that investment money however it feels. Makes about as much sense as a business that purchases its own IPO. SS isn't the current generation paying the previous one, it's a pension with a whole bunch of smoke and mirrors that pretend it's something else.

Scrap SS and just create a pension scheme - it's the same thing without the pretense of "investments". Give it a sliding scale with a means test if it makes you happy. Scrap the "SS is a separate entity" sham and roll the whole thing into general revenue.

401(k)s would be improved a lot by making them more open investments. Essentially they are just tax-deferred savings anyway so you may as well just treat them like a regular investment that people can go stupid with if they want. Get the whole incentive for companies to reinvest them in their own stocks out of the picture.

Dd

[Rsak]

It is silly that the Armed Forces are moving to a 401k system, but SS must continue to be the 3rd rail of politics and only after much pain will anything begin to change.

[Partha]

Now, imagine a good portion of the SS money in semi-privatized, pooled accounts. And by pooled, I mean that there aren't "individual" accounts like 401(k)s, rather pooled segments of the entire SS portion deposited in investment vehicles. Even if some of the pooled accounts lost money, overall, the diversification of the aggregate would counter the risk, just as 401(k)s do.

Then add some regulatory oversight to the mix, and restrict the types of funds the money can be placed in, cap the fees and maybe put some restrictions on the churn (or at least don't pay for the trades) and I think it could be a real good solution to the SS question.

Your problem, of course, is that the people you're voting into office who are pushing privatization also want to deregulate the industry, not actually commit to oversight of it.

[Embar Angylwrath]

So if there was oversight, you'd be for it then? Is that your only objection?

[Lurker]

Pay back the money that was 'borrowed' from the system, payroll tax money that was funneled into the war and tax cuts for the wealthy, and then we'll talk.

[Embar Angylwrath]

Pay back the money that was 'borrowed' from the system, payroll tax money that was funneled into the war and tax cuts for the wealthy, and then we'll talk.

Why don't we talk about fixing the system moving forward instead of requiring action before you come to the table? I sense another dodge fest coming up by the left.

[Lurker]

The system isn't fundamentally broken. Taking money out of the system is the problem.

If you want to see a 'dodge fest', look no further than people such as yourself who cheered and abetted the looting of the fund, and then blamed the 'system' when the time came to pay back the money.

[Flunkie]

SS makes no sense and never did make any sense now that I understand the fact it's all invested in T-bills. It's simply the government investing in itself, then spending that investment money however it feels. Makes about as much sense as a business that purchases its own IPO. SS isn't the current generation paying the previous one, it's a pension with a whole bunch of smoke and mirrors that pretend it's something else.

This is exactly what most Americans simply don't understand; I wish everyone at least understood this much about the system. If so, at least 60 or 70% of the populous would demand the system be changed. But because they don't understand it, they aren't going to care until the shit hits the fan, unfortunately.

[Flunkie]

The system isn't fundamentally broken. Taking money out of the system is the problem.

Let's use you planning your retirement, without the help of the Government as an example. You decide to use the Social Security method:

First you create a Lurker Treasury, your own private bank.

You create Lurker T-Bills and use a percentage of your pay to buy them; promising, of course, to pay them back with interest when retirement hits.

So what do you do with the money you gave yourself from buying your own T-Bills? If you're smart you invest it in something besides yourself, like the stock market, bonds, or real estate. If you're stupid, you just spend it like it's just part of your spending budget because you can always pay it back later.

What do you expect the Government to do with the cash they get from T-Bill purchases? Let it sit around collecting dust? Hell no, they're going to spend every penny and pray the population grows to infinity. The root cause of the problem with Social Security is that the money is in the hands of the Governement, it's a pyramid scheme that is going to colapse. You guys can yak away about means testing and such, but that just turns the system into an even bigger rip-off than it already is and encourages fraud. Besides all that, it won't solve the problem, only delay it, as there are too many people that need the money.

The fact is that 99.99% of the population would have been better off if their Social Security money had been invested in the DOW Jones index. They would have been getting far more than Social Security will pay them and there wouldn't be a nightmare scenario on the horizon.

[Lurker]

Spending is fine. Deficit spending is not.

If the 'fiscal conservatives' had used (spent) the surplus money paying down the national debt instead of squandering it on wars and tax cuts, greatly increasing the national debt, we wouldn't be in the bind we're now in. There's a bit of a credibility gap with the so called 'fiscal conservatives' and I see no reason to listen to solutions from the very people that cheered and abetted the cause of our current problems.

[Ddrak]

The system isn't fundamentally broken. Taking money out of the system is the problem.

If it's all invested in T-bills then there never was any money in the system. Taking money out just makes it worse, sure, but it's fundamentally broken as well if it's invested in T-bills.

Flunkie's right - just invest it in a Dow Jones mutual fund. It would be *much* better off there.

Dd

[Partha]

When will free marketers like Flunkie and Embar finally get the idea that Social Security was never supposed to be an investment? That's the EXACT reason it's in Treasury bills.

[Embar Angylwrath]

When will free marketers like Flunkie and Embar finally get the idea that Social Security was never supposed to be an investment? That's the EXACT reason it's in Treasury bills.

Whatever it was intended to be, Partha, hasn't worked. So maybe you change your perspective and come up with a solution that does work. You realize, that by arguing against "investment" you're really arguing to return less money to the populace than they could potentially have.

And Lurker.. your statement is dishonest. I've been a consistant fiscal conservative, and have pulled the Republicans into the woodshed because they spend just like Democrats.

And why is your (and Partha's) knee-jerk reaction to all budget and spending questions parrot crry of RAISE TAXES! RAISE TAXES! RAISE TAXES!?

How about the two of you come up with 10 Federal programs that you'd eliminate? Not policy or practice.. but actual programs.