From: bboerner@novell.com (Brendan B. Boerner)
Newsgroups: tx.politics
Subject: Re: Social Security
Date: 8 Jan 93 14:54:55 GMT
Distribution: tx
Organization: Novell, Inc. --Austin

In article <1993Jan5.013913.422@rpp386> jfh@rpp386.cactus.org (John F. Haugh II) writes:
>In article <1993Jan3.222920.7354@novell.com> bboerner@novell.com (Brendan B. Boerner) writes:
>>I'm currently paying into a 401K for my retirement; if I figure I'll be
>>retired for 8 years before dying, and draw from it accordingly when I
>>retire, and end up living more than 8 years, I screwed myself, if
>>there's no money in the fund, I'm not going to get any.
>
>Then you should look into an annuity.  It works surprisingly like Social
>Security.  You get to collect from it for as long as you live based on
>the amount you put in.

Yes, but can I go to my annuity holder and ask them to regularly add
a COLA to it because inflation is killing me?


>>It's my contention that SS is like my 401K, it seems that it's yours
>>that it's like my HMO.  Currently it doesn't matter which one of is
>>right since we're paying out anyway, rich or poor.
>
>No, my contention is that Social Security is like a lot of things.  It's
>like a life insurance policy that pays out over a number of years to my
>children should I die.  It's like a disablity policy that pays out if I
>am unable to work.  It's like a retirement annuity in case I live to be
>old enough to retire.  All of these investment instruments are sold in
>the private sector.  There is nothing magical about Social Security,
>except how it pays out.  It pays out based on the Democratic Party's
>principle of greed and wealth redistribution.

Sounds like SS is meant to be all things to all people, a common
criticism of Democrats, in which case I've got to wonder, why are
you defending it?


>>No, a) I'm giving you the line that SS is welfare for the _old_ (rich
>>or poor) and b) I was responding to your claim that 10K in income
>>didn't sound rich.  It is MHO that 26K/year (10K - taxes on it + 18K in
>>SS benefits), while not in Donald Trump's league, is hard to justify as
>>living uncomfortably, much less, poor.
>
>Social Security is not welfare.  Welfare is something you get without
>having contributed.  You can call it welfare all you like, but try
>collecting without ever having put a dime in.

So if we managed to get Congress to allow anyone who kicks in $1 to
collect $1,000/month from SS, it wouldn't be welfare because "they
contributed?"

Look, there's a lobbying group called AARP (American Assoc. of Retired
Persons or somesuch) which lobbies Congress on issues affecting senior
citizens and by all accounts, it's one powerful lobby.  One of the
things they do is lobby to protect SS, either to keep it from getting
cut or to expand it (increase payments for inflation, whatever).
Suppose that AARP is lobbying for higher payments and that to pay for
this, SS would have to be raised from 15.5% (I know I'm using the
aggregate SS + Medicare, it's just for illustration) to 20%.  Guess
what?  AARP does not care about how this will affect John F. Haugh II.
If you want to maintain your present standard of living (current
consumption + savings) you'll need to increase your gross either by
getting a raise or working longer hours.  But the key is that AARP does
not care, they want what's theirs, and when that's run out, they want
what's yours too.  Does this bother you?  It does me.


Another way of looking at this is:  suppose that you DO decide to
retire and collect SS - you'll collect less of what you paid in, while
the previous generation (your dad as an example) will have collected
more than they paid in.  Does that bother you?


Is this the same John F. Haugh II who complains mightily about his
tax dollars going to support people without jobs?  What do you
think the folks on SS are?


>As for $26K not being "poor", that's your opinion.  Personally I do not
>see myself having much fun on $26K.  (Which is why I never intend to
>retire - I doubt that my life would be very interesting if I didn't
>work, or if I didn't have a high enough cash flow to pay for some very
>expensive hobbies).

Yes, it's an opinion, but what would you have SS do?  Payout according
to each's persons definition of "poor", according to the highest
definition of "poor", the lowest, or something in between?  If you
bought an annuity, at least you'd have the choice of what to buy based
on what you think it would take to support you.  With SS, they're
trying to keep the largest group of folks reasonably happy without
presumably going bankrupt.


>>about it.  In fact, I probably bitch and moan more than you because I
>>do think that I'll never see a dime of SS when I retire, while what
>>you're complaining about is that you'll see less than a guy making
>>20K/year.
>
>No, I assure you that I bitch far more than you do about Social Security.
>I do not ever expect to collect a dime of it.  First, if I did die, my
>wife wouldn't collect because she isn't going to stop working because
>I'm dead.  Second, I don't ever plan on retiring.  Not at age 67, and not
>at age 77.

So I'm not going to collect because I think the system will fail, and
you're not going to collect because you want to keep working.  Great,
I'm not interested in getting into a pissing match with you about which
of us should be bitching the loadest.  Since you don't ever expect to
see a dime of your SS tax, do you consider this amount when you
calculate how much tax you've contributed to Uncle Sam each year (not
for tax purposes, just for an idea of how much you're supporting the
US?)


>Good.  Now I suggest you investigate the concept of an "annuity".  You
>may find that there is an investment vehicle that is a bit better suited
>to people who don't die when they expect.  Were Social Security treated
>like an annuity, based solely on financial contribution, and made
>actuarily sound at the same time, I suspect that I would be quiet about
>it, for the moment.

Are you saying that you'd be quiet about if SS was being funded by the
investments of payments in from the past, not relying on current
payments in to keep the system afloat?  If so, guess what?  We agree!
The idea that present payments from workers is being used to maintain
income for retired workers is what I've been bitching about all along.
If those current retirees were being supported by a huge pot filled
with payments and investment income from the past, I wouldn't be
bitching, even if each and every retiree was bringing more than I make
a year.  Why?  Because it would be their money, carefully invested and
allowed to grow.  But the reality today is that it's not their money -
it's ours.


Brendan
-- 
Brendan B. Boerner    Phone: 512/346-8380    MHS: bboerner@novell
Internet: bboerner@novell.com     \  Please use either if replying
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