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I love how they are going to exempt the current beneficiaries from cuts. And they dont even bother making up a lie for why that is.
"No one has the slightest idea what the world will look like in 50 years."
50?! Any president that says "My plan in 10 years blah blah." is full of shit. No plan lasts beyond 3 years.
No president lasts beyond 8 years.
"Color me disappointed. Especially with Rand Paul."
Keep huffing and puffing, Bruce. The retirement portion of SS is here to stay. In order to solve the medicare portion, America's health delivery system must be reformed.
The Republican party would like to have an issue to attract America's youth, as currently the Republican's have zero appeal among young voters. They'd better be careful when touching the third rail. It could be the road to permanent minority status.
There already exist a partial fix to medicare but now one wants to look at it. a majority of today's boomers have led a good middle-class life and a big % have retired with another health insurance but according to some retarded benefit law in Medicare, when you become eligible for Medicare, it pays 1st.....This is stupid crazy even though the beneficiary is probably paying 300% plus or more than what medicare cost......this is an insurance scam and fraud, if you retire with another insurance it should pay first 80%, medicare should kick in for the remaining 20%, but the first payer should get the medicare rates. I proposed this to my (R) senator in a open forum last year, all I got was a stupid stare and a uh, uh, I need to look into that. It's hundreds of billions on the table in savings...just saying, its not that hard to see.
The Author states: "A very convenient way to cut expenses is to just increase the age for eligibility by a few years."
This is wishful thinking. Older workers tend to injure themselves more and require longer to recuperate from injuries than younger workers. By the age of 64 about 30% of all workers are collecting disability and workers comp. This costs about four times what Social Security costs. The government may save social security but it will bust the SSI and medical system. Do you want 80 year olds standing on step ladders at Home Depot to fetch anvils?
When SS looks at the status of the fund they do it with a 75 year window. They plug in a number to some monster computer and it spits out an estimate of what might the future will bring.
They do not look at the "cost" of increasing the retirement age. They only look at the "benefit".
So the way the accounting is done is "convenient". I did not say it was cost effective or good for society.
I don't want to see the age limits raised for the reason you site and the reduced youth unemplyment issue. I promise you, the age limits WILL be raised. But not for the boomers......
I see allot of fallaciousness when it comes to saying before unions and "socialist handouts" starting with FDR helped bring people out of poverty and protected them...no the expansion of means of production from investment in capital goods to create consumer goods is what raised the standard of living over the last 70 years..generational warfare center stage! To all the disgruntled baby boomers you will get what you deserve for paying all those taxes high taxes letting greenspan piss away the currency and letting the politicians and big banks rob you blind. I just hope my generation can rally together and burn his system to the ground in my lifetime the baby boomers who took care of their kids and treated them right will get taken care of by there children the rest can starve in the streets for all I care the whole baby boomer generation through a BIG ass party on the backs of my generation and the bill is coming due and the only way out is for them to try and kick the can again well sorry baby boomers gravity is about to crush it. hasn't this been the story for 2000 years though? I see ALOT of my generation turning their backs on their parents because they turned their backs on them....youth doesn't last forever treat your kids right while you still have the chance! parties about over.Thats why I advocate cutting our losses going and going back to the gold standard and making fractional reserve lending a crime...then we'll have real decent wages and high savings rates...and yes very low unemployment and making people rely on their own savings from those decent wages would be a gift to the future for a sustainable system...the whole system is already burning down now anyway.
@bruce 75 years? the booms and busts are coming at ungodly exponential rates now this monetary system I think has maybe 2-5 years left at max before we go back to stone age barter I try to be optomistic here but we are dealing with the largest ponzi scheme in human history.
The Baby Boomers are a terrible problem.
Maybe the boomers will go away if we just give them all the money back that they've paid into the system over the last 40 years. I'm sure they'd be happy to make their own arrangements, especially if we paid them back adjusted for inflation, not notional dollars. Problem solved.
Surely, the Gen Xers have accumulated enough GEDs by now to go it alone and don't need boomers holding them back.
+1. I hate SS, too. Just give me back my contributions with interest, bitchez.
How about getting rid of the whole damn system? Socialism is a failure and always will be when compared to hard work and free market capitalism.
You cannot have Capitalism without some form of Socialism or vise versa.....it just wont work, the problem is the % of both with Capitalism being truly free. What we have today is Capital-Socialism, ie" a total consumer based economy because free Capitalism is no longer since greed and complete corruption rule........todays Capitalist are soon to see that the products or services they sell will no longer have buyer's here because all the jobs are gone. BECAUSE?
It's ironic that people are intelliget enough to figure out that the Gvt is totally broke, but still goofy enough to spar over who should get a piece of the fictional pie. There is no pie, children. No pie.
I'm not counting on anything.
Wrong! there is indeed a pie ... a big one as well, but it is for very few people at a private party. And the pie has gotten bigger and bigger...
Who, with legal authority, authorized the FED to committ U.S. Taxpayers to the $12.1 Trillion above and beyond the original 700 Billion that Congress originally granted? The 1st American Revolution was about "no taxation without representation". They had a much weaker case than we do.
"TAXPAYERS ARE ON THE HOOK AND HAD NO ONE REPRESENTING THEM"
Are you saying, we should just move on and forget the greatest heist in the history of the world? Totally ILLEGAL and in our face.
All this bullshit about making Social Security and Medicare work, is a complete farce vs what I just said. Why are we discussing it at all, when the previous crime goes unpunished.
If they can print-up digital cash at will, and give it to their friends, and then say F*** YOU, why go on?
Saying this wasn't the Boomers fault is SO LIKE THE BOOMERS.
Who were the last three presidents? Who has/will dominate the White House for the past *20 years?? Boomers.
They had *plenty of time* to moderate or slam on the brakes. But instead we have: 3 wars. $14 trillion in debt, mostly in entitlements & war. Less freedoms. DHS. TSA. MOST of our tech jobs offshored or taken up with H1B visas. All of these policies under so-called 'draft dodger' 'chickenhawk' or 'deferment elite' Boomers. Like Bush 43, Clinton, Obama or their cabinets ever even really served. Those who never did drag us into perpetual war, and now expect us to pay their retirement & entitlements??
The question is, while they are 'eating cake' up in their Bastille what do they expect us to do? You know how those types of movies end.
Haven't read all posts. In 1983/84 under the Pubs SS was saved for future generations. Taxes were raised and the excess receipts were to put in bonds for the future. This was not done. The excess was used for tax cuts/wars/etc. The amount of excess was so substantial that if not spent there would be enough money in the fund that future collections would no longer be needed or the age of retirement lowered.
This was done even tho the contributions were capped so the wealthly would not be inconvenienced monetarily. We can raise the cap, put the money in a trust and there will be no problem. Actually do away with advancing the age as it is currently in the future.
This debate is the same scam used by Dole/Reagan.
Over half of national income is not currently taxed for SS. One might wonder why this is not mentioned more in the press. My guess is the Koch brothers forebid it.
The Federal Reserve took the Trust Fund Money and left IOU's and they are not going to give the Money back. Plain and simple. I allege they are Theives. Because they do not wear masks does not mean that they did now steal.
They hope everyone will die before they can collect a penny of what they put in over 50 years and their IOU's are so to speak in the money as no one will collect the Money they Took.
What I really despise about it is that the now call it an entitlement. You pay in 50 years into a Government insurance plan for when you are old so that you have some Money coming in. Yet the real travesty is that they said our tax rate was say 35%. But, if you add the 15% for Social Security and Medicare our actually tax rate was 50%. No one would have stood for a 50% tax rate.
If Social Security and Medicare is in fact an entitlement, then I want the additional 15% tax I paid above the legal rate returned with compounded interest. The interest the IRS get for non payment of taxes including a non payment penalty for not returning my over paid taxes each year.
Bruce, you are so well-written & well-respected. Why can't we do as some would suggest (like Professor Michael Hudson) & just put a 1% tax on all deriviative trades ? Why can't we just tax the big investment banks a 1% tax on allfinancial transactions & we'd have SOCIAL SECURITY funded ? Look what's happening now, we are fighting amongst ourselves, pitting generation against generation. Things never used to be like this when I was a kid. My parents were just fine, they got a 15 year mortgage & paid it off in 10 years which freed up their income for saving for their retirement ! other generations earned interest on that savings in a bank. my parents had money in bank accounts earning interest, they had a paid off home in only 10 years, they had a pension & social security & earning interest !
It's not the baby boomers fault, it's gross mismanagement & looting of the Treasury at the highest levels of politicians & wall st. investment banks ! the dirt is being thrown on top of the baby boomers who led good lives, playing the game & assuming the money paid in would be there for them, not looted ! sincerely ....
they built a financial structure, that would eventually reach a point, where it would collapse under its own weight. we already passed that point. its so big, that the collapse, is going to take longer, than you would expect, but the outcome is inevitable.policy cannot override mathematics. neither can fraud.
The baby boomers built the financial system??? Nice try.
now ... that would actually make sense ...
Lmo's 3 step plan:
1. Send every name listed in the SS database a check for the amount they paid in less any amounts already paid. Note that this may contain a negative number thus a bill should be sent instead of a check.
2. Sell all SS department assets to the highest bidder. End fraudulent ponzi scheme of a scam that evah wuz and walla...fixed.
3. Tell ex-recipients to get a job, create a job, or find a local church for future support.
You would have to calculate in the value of the Dollar when they made their contributions. Plus the interest based on the Fed Fund rates thruout the 50 or so years to make it fair.
I remember when 45 years ago a REALLY good salary was $10,000. a year. Houses cost an average of $35,000. to $40,000. So, how could you possibly after 45 or so years say you just want to return their money without consideration for the current devaluation of the Dollar, inflation and compounded interest. Just a cop out.
The folks who were paying taxes before 1980 paid much higher marginal rates, which is one of those things that so often seems neglected when hatin' on the Boomers. Since 1980, payroll taxes were increased a bit, but the size of government was expanded far beyond any possible solution. If you grow the government indefinitely, policy really accelerated by Reagan, it makes no different how you set up the bill--there comes a time when it cannot be paid.
We haven't paid for anything since the Reagan revolution. Literally. Now we CANNOT pay for anything.
Best bet is to cultivate your ability to survive on minimal income, rather than worry about earning more. You don't need the big house, or the fancy car, or the hot-tub, or the hundreds of channels of mental pollution piped into your brain. You'll probably be happier as soon as you come to understand this.
It's like Godwins Law: at some point a comment comes up and basically says "it was all Reagan's fault"
That seems to be vastly outnumbered by posts indicating it's all Obama's and/or Jew's fault.
It's not his "fault" at all, that's just a convenient place to point out a major change in direction for our spending policies. I think Johnson deserves at least as much blame. But Reagan made major changes in how the government spent money. Big tax cuts and major spending increases. That policy shift has been steady and worsening with everyone since.
Nixon (when he killed the gold standard) should've been the guy who started it, but he actually tried to keep a handle on spending.
well ... some historical/factual correlations are inescapable ... aren't they?!
Too bad you non-boomers never read the SS act. You are taxed on wages and active investment income. Never heard of passive investments? You deserve to be screwed.
mynhair, you're too smart for your own good!
80% of households in USA make $50,000 or less ... what kind of active or passive investment do you want them to make!?! ...
if wage and price trends keep up, pretty soon the only deposits they'll have is what they release in the bathroom after digestion.
So what happens when your financial planning doesn't work out? You see in real life without the baby talk of everyone can be successful and everyone can own a business and everyone will win in the end, it doesn't happen. For many reasons you can be on the losing side, and then what happens. You go live and die in a gutter with almost no SS and Medicare (and just to let some of you know, the republicans and some democrates want all those programs gone). We are a consuming society, event he presidents and Greenspan said to go out and consume. The problem with consuming is that you don't save. They didn't say consume what you can afford, they said consume.
Also they are making an assumption that our economy doesn't implode or reset during this 2 decades of changes. I think our economy won't be anywhere close to usable in the near future, they won't be using the dollar. So before this stuff even happens, we will se yperinflation and a massive depression in the western world.
save the ponzi by eliminating the new entrants... or ... hasten the fall, thinking the other side of the same coin will take the blame ... reptiles.
August is just simple arithmetic. If you find my work cryptic, you are in the derivative box of boxes, and you may want to get out of there before August, when all the exits will be sealed and the herd will begin to stampede itself to death. All the governments on the global IC chip are borrowing money to make make-work payroll and paying only the interest, with taxes on make-workers, with no intent of paying the principle, ever, and the bondholders are all the governments, in a circle-jerk. In August, the chain reaction of bankruptcies will ignite because they will not be able to make the interest payments without dismantling the TBTF entitlement system.
Replacing humans with machines, papering over the windows with accounting adjustments, and providing free entertainment creates the illusion that the box is not on an airplane falling from the sky. Next up, we’ll discuss some specific problems with global automation that may shed some light on the Boeing problem. Suffice it to say, the Fed prints money, ordering the denizens to create the wealth required to support it, and then the crap flows downhill until it is all placed on the shoulders of intelligent kids, who have repeatedly told them to go f*** themselves. The resulting wave has bounced back and forth in several iterations until the positive feedback loop is now reaching the threshold of quantum resonance.
If you want to see the real magnitude of the RE problem, don’t ask anyone; get the automated data on foreclosure notices, and check the machine signature. Every machine has a signature. Extrapolate the nature of the curve from a point just before the machine was interrupted, and then check the data each time they try to put the machine back on auto.
There are a million different ways to get a fairly reliable estimate with much less work, because symbiotic systems create signatures in the neutral line. Build yourself a spectrometer to avoid agency costs, which are prohibitively expensive by law. “all powers not granted …” – the definition of the word granted depends on the lawyer’s judgment of the framer’s state of mind, a circular argument for sheeple, indoctrinated to follow the path by the education system.
Where does it say anything in the Constitution about Family Law and what was the problem with common law? The foundation is always, of necessity, virtual, but the reptiles never learn, so you always want to have something ready on the shelf. Always build your elevator shaft first, with the assumption that the associated inverted pyramid will collapse, shortly after it creates the strait.
“The group doesn’t see as its mandate to define new ideas. Instead …” You may always rely upon the boys at GE to propose make-work as the solution to the make-work problem.
ponzi schemes do not go quietly ...
From the very beginning Social Security was a fraud and a lie. It needs to be utterly abolished, not bailed out.
"We are going to steal from you your whole life, and spend the money on war. But don't worry, this nifty program will be quite alright because we will STEAL from your CHILDREN to take care of you when you are old."
What a twisted society. They made a deal with the devil, and now the old in America will suffer as well as the young.
Good Job Bruce and Thanks, BTW;
Excellent Article on Social Security and Medicare vs BANK BAILOUTS
By Michael Hudson
Free money creation to bail out America’s elite financial speculators, but not for Social Security or Medicare
Only the “Crazies” Get the Bank Giveaway Right
"So who are the losers in the Graham, Paul, Lee plan? The answer is that anyone born after 1966. If you’re younger than 47 today, bend over. The Boomers are going to screw you. You’re going to pay more than you should and you’re going to get less than the boomers got."
Your math is slightly off. Anyone born after 1966 is 45 or younger. With my husband and I born in 1965 and 1966, I am still not sure if we are in the group getting screwed since we are younger than 47, but we were not born after 1966.
Let me assure you: you are in that group. Just like myself.
I would gladly op-out (36 years of payments ) as well just let my 401K become a Roth 401K without paying any taxes ....
No Taxes Collected Jobs Shipped to China 50K a Month since 2000 and now Cuts to Real Working Americans
For a DECADE! We have shipped 50,000 Jobs a MONTH! To China! (alone)
For the majority of that time we have given Tax Breaks to Corporations to Move those Jobs.
For the better part of a DECADE! We have undermined our own Tax Base!
For Longer! Than a Decade we have allowed the Largest Money Makers, with the Largest Lobby’s to Pay almost NO! Fucking Taxes!
America is NOT! a Country that has no social safety net or that is supposed to be OK! With being a Police State.
If any Citizens want to live in an America with no Social Safety Nets!
If any Citizens want to live in an America that is a Police State!
Should get the fuck out and go live in one of the MANY! Shit Hole Countries that are already living under those conditions!
America is Supposed to be better than those 3rd World Countries!
But the top 1% of the 1% keep spending Lobby monies and Buying T.V. ad time to realize a 3 rd World America!
Most of you buy Gold and Silver to insulate yourselves from an uncomfortable life style! I buy Gold and Silver so that in the event of Social un-rest that I may be able to pay for / feed an army to Rout by the Almighty God! You Wanna Be Tight Fisted, Treasonist Scum from My Country! I pray for the chance to rid this once Great Country of the scum that is the real drag that keeps hungry children hungry! God have mercy on you because I will NOT!
All of you that support people / corporations NOT paying their fair share!
All of you that support a 3rd World Living Standard for any American for ANY REASON!
I want to see you Hanged on the White House Lawn!
Here is Sen. Sanders’ list of the 10 worst corporate income tax avoiders:
1) Exxon Mobil made $19 billion in profits in 2009. Exxon not only paid no federal income taxes, it actually received a $156 million rebate from the IRS, according to its SEC filings. (Source: Exxon Mobil’s 2009 shareholder report filed with the SEC here.)
2) Bank of America received a $1.9 billion tax refund from the IRS last year, although it made $4.4 billion in profits and received a bailout from the Federal Reserve and the Treasury Department of nearly $1 trillion. (Source: Forbes.com here, ProPublica here and Treasury here.)
3) General Electric made $26 billion in profits in the United States over the past five years and, thanks to clever use of loopholes, paid no taxes.(Source: Citizens for Tax Justice here and The New York Times here. Note: despite rumors to the contrary, the Times has stood by its story.)
4) Chevron received a $19 million refund from the IRS last year after it made $10 billion in profits in 2009. (Source: See 2009 Chevron annual report here. Note 15 on page FS-46 of this report shows a U.S. federal income tax liability of $128 million, but that it was able to defer $147 million for a U.S. federal income tax liability of negative $19 million.)
5) Boeing, which received a $30 billion contract from the Pentagon to build 179 airborne tankers, got a $124 million refund from the IRS last year. (Source: Paul Buchheit, professor, DePaul University, here and Citizens for Tax Justice here.)
6) Valero Energy, the 25th largest company in America with $68 billion in sales last year, received a $157 million tax refund check from the IRS and, over the past three years, received a $134 million tax break from the oil and gas manufacturing tax deduction. (Source: the company’s 2009 annual report, pg. 112, here.)
7) Goldman Sachs in 2008 only paid 1.1 percent of its income in taxes even though it earned a profit of $2.3 billion and received an almost $800 billion from the Federal Reserve and U.S. Treasury Department. (Source: Bloomberg News here, ProPublica here, Treasury Department here.)
8) Citigroup last year made more than $4 billion in profits but paid no federal income taxes. It received a $2.5 trillion bailout from the Federal Reserve and U.S. Treasury. (Source: Paul Buchheit, professor, DePaul University, here, ProPublica here, Treasury Department here.)
9) ConocoPhillips, the fifth largest oil company in the United States, made $16 billion in profits from 2006 through 2009, but received $451 million in tax breaks through the oil and gas manufacturing deduction. (Sources: Profits can be found here. The deduction can be found on the company’s 2010 SEC 10-K report to shareholders on 2009 finances, pg. 127, here.)
10) Carnival Cruise Lines made more than $11 billion in profits over the past five years, but its federal income tax rate during those years was just 1.1 percent. (Source: The New York Times here.)
Microsoft’s purchase of Skype for $8.5 billion provides a perfect illustration of why adopting a true worldwide corporate income tax system is critical to our economic future.
According to the Wall Street Journal, the cash for Microsoft’s purchase of Skype (a Luxembourg-based company) will come out of its $42 billion in liquid assets held in foreign subsidiaries.
Because it is purchasing a foreign company with its overseas assets, Microsoft can avoid paying any U.S. tax that would be due if it had repatriated foreign earnings in order to purchase a US company for the same amount. Based on the company's effective foreign income tax rate disclosed in their most recent SEC filings, a repatriation of $8.5 billion dollars would cost Microsoft somewhere in the neighborhood of $1.1 billion in U.S. tax.
As a Forbes commentator opines, the Microsoft-Skype deal demonstrates the harmful incentive created in our current system that encourages companies to invest in overseas companies rather than domestic ones. The fear is that this deal may just be “a harbinger of things to come.”
Republicans to roll out new tax-cut proposal: WSJ25 May 2011, by Michael Kitchen - Los Angeles (MarketWatch)http://www.marketwatch.com/story/republicans-to-roll-out-new-tax-cut-proposal-wsj-2011-05-25
Republicans in the U.S. House of Representatives are set to unveil a new economic proposal Thursday that will cut taxes for multinational corporations and lower other tax rates.
You can rant all you want but you are totally missing the problem. Any business merely collects taxes from its customers. Who do you think would pay the higher prices these corporations would impose on their products? Jobs have moved overseas because we insisted on becoming the world's reserve currency and when we did that most folks with foresight knew that jobs would move overseas. And we did in anyway, knowingly with our eyes open.
Sure we wanted cheap goods, we wanted nice stuff as cheap as possible. So where could that stuff be made that wouldn't involve all the externalities like unions, osha, ss, minimum wage, erisa, epa and all the other regulations and sundry taxes which don't necessarily exist in some of the cheaper wage areas overseas.
So get off your high horse and be constructive about what we can do to be more competitive. How about finding a way to reduce the size and scope of government so we don't have to borrow 40 cents out of every dollar the feds need given the budget they insist on having.
I am fine with eliminating subsidies to corporations, farmers, artists, and any other bloodsucker who wants money from the government. That would be a great start. But man, please stop the "we need to gouge the big businesses" rant, it makes no sense.
But man, please stop the "we need to gouge the big businesses" rant, it makes no sense.
Gouge? Fucking Gouge? You should be HUNG for Treason! Against Your Fellow Americans.. either you are drunk on repugnant koolaide or you are stupid, maybe both?
Either way.. pass thru is your excuse for the Government going broke?
How about the tax breaks to move the 10,000 jobs a month off shore? more pass thru savings??
People like you, the un-paid ignorant lobby of the Corporations are the sheep that this Country needs to rid itself of so that it may be what it once was.. not filled with idiots.
The boomers are inherently delusional as they have always accepted and aberration(1 middle class generation retiring comfortably) as the mean..As good sheeple they have chewed there way thru almost every resource we have and will continue to do so as the most self absorbed generation ever.
Hopefully we won't have to soylent green them; but they are after all high in fat, sugar, and preservatives and may taste OK
Bruce is right and everyone who disagrees with him is wrong.
Any questions? Cue Bob Marley. "Exodus!"
The Amish do not pay SS.
That's because there was a law passed in 1965 that gave them a religious exemption. They don't pay SS as you correctly stated but they also don't receive any benefits.
Another interesting fact about the Amish is that although the national rate of autism is about 1 in 150 children, the rate among the Amish is zero, as in none. They don't allow their children to get any vaccines.
Social Security is just a Ponzi scheme in drag.
How about choice D) opt out.
I would like to shame the Social Security system with data. But can I get the data?
Here's the concept: divide Social Security participants into one-year "cohorts" based on age. Cohort 2011 will be those who turn 65 in 2011.
For each cohort, use IRS and SSA data to calculate total paid-in over their lifetimes. Add up all the contributions deducted.
Then, based on actuarial assumptions, calculate the total that will be paid out over the remaining lives of the cohort.
How much did the 2011 cohort pay in, and how much will they get out? Divide by the numer of people in the cohort for easy interpretation.
For bonus points, adjust for the return earned on the contributions (should be easy if it's purely Treasuries).
The only right and fair solution is to retroactively make the plan defined-contribution. Geezers should not get out more than they paid in, with the difference made up by robbing the young.
So, where's the data?
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