From: jfh@rpp386 (John F. Haugh II)
Subject: Re: Social Security
Reply-To: jfh@rpp386.cactus.org (John F. Haugh II)
Organization: Los Tejanos SCUBA Club and Beer Joint, Austin, Tejas
Distribution: tx
Date: Tue, 5 Jan 1993 01:39:13 GMT

In article <1993Jan3.222920.7354@novell.com> bboerner@novell.com (Brendan B. Boerner) writes:
>Ummm, I don't think there's a built in limit in my HMO; a better
>analogy would be auto liability - you get sued for $1 Mil and all
>you're covered for is 300K, they, yes, you're in hock $700K.

Most HMO's have a limit up around $1M per lifetime.  But that's really
irrelevant.  If you have a coronary and it winds up costing the HMO
$50K, odds are you received more than you put in.

>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.

>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.

>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.

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).

>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, let me ask you this one straightforward question.  Given that it
>>is very unlikely that Social Security is going to be abolished, do
>>you favor cutting back on benefits to people who, because they planned
>>better for their own retirement, now find themselves with some amount
>>of accumulated wealth?  Or should FICA contributions be the only
>>deciding factor in FICA distributions?
>
>I think a) if it currently isn't SS should be like my 401K (i.e., after
>you exhaust "your" account, that's it), and b) EVERYONE gets paid out
>at the same rate regardless of accumulated wealth (i.e. I'm _agreeing_
>with you (imagine that) that in your previous example, the poor guy
>getting 0.67 back on what he had paid in while the rich get 0.43 is
>unfair).

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.
-- 
John F. Haugh II                  [ PGP 2.1 ] !'s: ...!cs.utexas.edu!rpp386!jfh
Ma Bell: (512) 251-2151           [ DoF #17 ]        @'s: jfh@rpp386.cactus.org