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What do you think it is?</p>
<p>It ain’t welfare.</p>
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Isn’t that the same thing?</p>
<p>no, income redistribution happens mainly at the level of crony capitalism these days.</p>
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<p>I assume you include many of those who are currently benefitting from favored economic treatment by the government. For example, GE paid no income tax in the US inspite of its 14B in earnings. Buffet has been in a dispute with the IRS for 4 years during which time his Berkshire Hathaway has paid very little in taxes. Both, of course, are politically well connected and do a good double speak which means they are “seen” as believing in Robin Hood taxation, which they do not.</p>
<p>Most wealth redistribution in this country happens upwards, not down.</p>
<p><a href=“http://www.rollingstone.com/politics/blogs/taibblog/owss-beef-wall-street-isnt-winning-its-cheating-20111025[/url]”>http://www.rollingstone.com/politics/blogs/taibblog/owss-beef-wall-street-isnt-winning-its-cheating-20111025</a></p>
<p>From the article:</p>
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<p>Read more: <a href=“http://www.rollingstone.com/politics/blogs/taibblog/owss-beef-wall-street-isnt-winning-its-cheating-20111025#ixzz1c2joDHSB[/url]”>http://www.rollingstone.com/politics/blogs/taibblog/owss-beef-wall-street-isnt-winning-its-cheating-20111025#ixzz1c2joDHSB</a></p>
<p>Well… Notrichenough…you will have to discuss that with mini.</p>
<p>Mini brought that up.</p>
<p>I am waiting for razor-sharp to show me why SS is a handout…</p>
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<p>You can call it welfare until the cows come home. Doesn’t make it so. How is it welfare if you’re paying for it? Lots of the working poor pay for years into the system and never collect a dime, given that they don’t live long enough to collect.</p>
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If it’s not a handout, what exactly do you think SS is?</p>
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The FICA taxes you pay are paying for other people’s SS benefits, not your own. Your payments have not been invested, there is no account somewhere with your name on it with a balance in it.</p>
<p>Congress could eliminate SS tomorrow, you have no right to any future benefit based on past taxes paid. You have no ownership right to what you’ve already “paid” in.</p>
<p>When you collect, other people will be paying your benefit.</p>
<p>People like to think they are paying into some sort of “system”, but this is a fiction.</p>
<p>it’ll never happen notrichenough.</p>
<p>Seniors vote.</p>
<p>“All the greedy people today who want endless government benefits paid for by someone else have fulfilled Franklin’s quote”</p>
<p>Which he said almost 200 years after he died.</p>
<p>(Actually, it is thought by a few that, while the quote comes from 1988, it may be a paraphrase of a paraphrase from Alexander Tytler made by a proto-fascist living in Oklahoma named Elmer Peterson. Tytler, a Scottish professor, was a vicious anti-democrat, staunch monarchist, who thought the Americans were a bunch of fools. But even that attribution is doubtful.)</p>
<p>I agree that congress can change SS and that is a problem…</p>
<p>But that doesn’t make SS a welfare program.</p>
<p>I really do want razorsharp to respond to post 196… Answer post 196 razor-sharp…and do you think SS is a handout?</p>
<p>Let me put this in simple terms that perhaps you’ll understand, notrichenough: If I give you three hundred dollars, twice a month for thirty years, and you later begin to give it back to me in scheduled increments, it can’t logically be called “a hand out”, and certainly not welfare. When you withdraw money from your checking account, do you consider it charity from your bank?:rolleyes:</p>
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<p>In the example, we have to double the contribution because the employer sends in a matching contribution.</p>
<p>Using 5% compounding, and assuming that same return during the “drawdown” period, 30 years of contributions of 14K per year will produce a total value of 930,000 at the end of the 30th year contributing. Drawing that down, with a 5% continuing return on the undrawn balance, over a thirty year period will produce annual payments of about $60,500.</p>
<p>These are correct on an annuity basis, but since social security insures spouse, minor children, and has disability aspects, the real number would be less. </p>
<p>But its pretty clear that social security is a bad deal for those above median income levels. The only thing that keeps it from being atrocious is that there is a cap on the earnings that are assessed the premiums.</p>
<p>Edit: just went to the social security quick calculator and for a 25 year old today who earns 100K and retires at age 65 in about 2030, his annual benefit is estimated to be about 27,000. It doesn’t take a long look for someone in that boat to realize he’s not getting a fair deal.</p>
<p>PS: putting money in doesn’t make something make financial sense. Its a handout if you’re taking out way more than you put in. See the Madoff lawsuits for some legal ideas about schemes like this.</p>
<p>So…if it is a bad deal…it is hard to call SS an entitlement, isn’t it, dadx?</p>
<p>Because of compounding…people SHOULD make multiples of what they put into SS.</p>
<p>Calling SS an entitlement or a handout is bs.</p>
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It would probably be political suicide to eliminate it.</p>
<p>But I fully expect major changes in the future. Benefits will cut lowered, and means-tested, retirement age will be increased, FICA taxes will be raised.</p>
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When you put money into your checking account, you retain ownership of it, which lets you take it out whenever you want.</p>
<p>When you pay FICA tax, you do not keep ownership of it, any more than you keep ownership of the Federal or state income tax your pay, or sales tax, or RE tax, or any other tax. And you have no inherent right to receive a benefit. There was a Supreme Court case that established this decades ago.</p>
<p>You can think of your FICA taxes as investing in a pension plan if it makes you feel good. I’m sure most of the public thinks of it this way, because that’s how it has been sold to them.</p>
<p>But that doesn’t make it reality.</p>
<p>“But its pretty clear that social security is a bad deal for those above median income levels. The only thing that keeps it from being atrocious is that there is a cap on the earnings that are assessed the premiums.”</p>
<p>Not if you live to 85, and others live to 64.</p>
<p>Dadx…people who are wealthier live longer. mini…posted an interesting video a hundred posts ago about income inequality…and one of the slides mentioned this…</p>
<p>So at least wealthier people…on average receive SS for more years…and this does help their return…</p>
<p>On your calculation of a 25 year old today…what rate of return did you use?</p>
<p>You are 20 years off dadx…a 25 year old today won’t retire at age 65 in 20 years…</p>
<p>If you are using 5% I think the numbers will look better when you fix this…</p>
<p>Notrichenough…make up your mind…if SS is welfare, a handout…why do you care if congress lowers benefits?</p>
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<p>Yes, and more’s the pity for those who would eliminate social security and medicare, isn’t it? I predict that one day (and perhaps not that far into the future), there will be a movement afoot to disenfranchise seniors by imposing a voting age limit. A lobby like AARP is only as powerful as its ability to mobilize the voting strength of it’s members. Take away seniors’ right to vote, and they’re as powerless to effect political change as your average 15 year old. I foresee inter-generational economic warfare, and it will not be pretty. Yeah, roll your eyes and laugh if you want to. Just wait and see…</p>