Marco Rubio: "When Social Security first started, there was 16 workers for every retiree. Today there are three workers for every retiree and soon there will be only two for every retiree."

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    Sep 08, 2011 12:53 PM GMT
    Whatever you think of the guy, Politifact rated this statement absolutely true. It's also why the US is going to be in significant trouble going ahead and this "fiscal crisis" is set to be getting a whole lot work.

    Social security is a ponzi scheme - while Politifact clearly points out that they consider it not to be a ponzi scheme because it's "legal" this is how Ponzi schemes work - they depend on the next generation of fools to pay for the last - but at some point the money runs out.

    http://www.politifact.com/florida/statements/2011/aug/24/marco-rubio/reagan-library-speech-marco-rubio-takes-social-sec/

    That out of the way, we wanted to check Rubio's example of the Social Security system, that the number of workers per retiree has dwindled from 16 to 1 when the program started to almost 2 to 1 today.

    Our colleagues at PolitiFact Georgia examined a similar claim made by U.S. Sen Mark Warner, a Democrat from Virginia.

    Experts they talked to said the best information comes from the Social Security Administration, the federal agency that administers the program. Social Security was created in 1935 by President Franklin D. Roosevelt as part of his New Deal. The program has been amended several times over the years, which makes an apples-to-apples comparison somewhat problematic.

    But on regurgitating the data, Rubio is largely correct.

    The first set of Social Security Administration data comparing the ratio of workers to retirees comes from 1945 (the first benefits were not paid out until 1940). In 1945, there were almost 42 workers per retiree.

    In 1950, after changes to the program expanded coverage to an additional 10 million Americans and improved benefits, there were 16.5 workers for each Social Security recipient. That's the number Rubio is citing and is supported by experts.

    By 2011, the worker-to-retiree ratio had dropped to 2.9 to 1. The ratio is projected to continue to shrink, to 2.4 workers per retiree in 2022 and 2.2 workers per retiree in 2027.

    We should note the workers-per-retiree figure shrunk quickly following 1950. By 1955, the ratio was down to 8.6 workers per retiree. By 1965, the ratio was 4 workers per retiree.

    None of that speaks counter to Rubio's statement. In some ways, it illustrates the main problem with Social Security -- more and more money is going out in benefits and less and less money is coming in through payroll taxes.

    Rubio said, "When Social Security first started, there were 16 workers for every retiree. Today there are three workers for every retiree and soon there will be only two for every retiree." The official numbers from the Social Security Administration back him up. We rate this claim True.
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    Sep 08, 2011 1:56 PM GMT
    More here - with practical advice for those who actually think it's a problem:

    http://finance.yahoo.com/focus-retirement/article/113450/social-security-secrets-smartmoney?mod=fidelity-livingretirement&cat=fidelity_2010_living_in_retirement

    "Things Social Security Won't Tell You"

    1. "Long-term deficit? We can hardly afford our bills today."

    2. "The more you make, the less you get back."

    3. "This used to be a much better deal."

    4. "Want a bigger check? Go back to work."

    5. "Good luck qualifying for disability."

    6. "You can be unemployed and retired."
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    Sep 08, 2011 2:06 PM GMT
    If SS is a Ponzi Scheme then so are all for profit insurance plans and their Companies who issue those insurance plans are Ponzi Schemers. LOL

    But since the Insurance Co's Ponzi Schemes are for profit, Far Righter Repubs see them as OK, its only a 'bad' Ponzi Scheme if its run by Government. Is that what we are to take from this Far Right Republican complaint about SS ?


    I am with Romney's statement back to Perry's making this Ponzi Scheme failure accusation last night at the Repub. Debate. Romney said you cannot call SS a failure with America's Seniors depending on it now for 70 years, I don't want to end it, I want to repair the program.

    I'll add that simple repairs to the program is all that is needed, this program has been so successfull that the Congress and Senate have barrowed from its funds to the tune of over 2 trillion. Sounds like a pretty successful fund to me, a fund we should have laws against congress taking money from.

    The complaint here is seems mostly to be the number of workers to those who draw which has weakened the program. At the orrigination of SS, there was no way to foresee the baby boomer generation, its retirement and simultaneously a severe recession with high unemployment cutting into the ratio of those paying in compared to those drawing.


    Simple fixes are available for SS which is not now nor ever has been an expense to the federal government. Gradually raise the age of retirement since we are living longer, then increase the income range from the current $102,000 to $120,000 for taking out SS deductions. Then the program will be solvent according to officials who are well versed on this issue in the Government. I've also read that the current funds are adequate for up to 25 years.

    It seems to me that some Far Righter Repubs are just intent on making this a huge problem where there isn't one, so they can end the program. That will not happen, Romney's statements as a moderate will prevail and the Ponzi Scheme accusation will more than likely backfire.
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    Sep 08, 2011 2:11 PM GMT
    lol, you were busy posting on another topic how easy it was to get a job, if you found yourself in an abusive workplace.


    Incidentally, boomers are only 28% of the population and shrinking. The birthrate in 1994 was about the same as it was in 1953.
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    Sep 08, 2011 2:12 PM GMT
    Good point, Realifedad,

    "But since the Insurance Co's Ponzi Schemes are for profit, Far Righter Repubs see them as OK, its only a 'bad' Ponzi Scheme if its run by Government."

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    Sep 08, 2011 2:24 PM GMT
    realifedad said If SS is a Ponzi Scheme then so are all for profit insurance plans and their Companies who issue those insurance plans are Ponzi Schemers. LOL


    Sorry, your premise is wrong. You just don't seem to understand insurers. In insurance, you are required by law to have enough assets on hand to cover probable outcomes discounted to present value - it's a simplified explanation granted, but compare that to Social Security.

    Social Security knows it does not have assets to cover those "insured" - in fact they are quite open about the fact they have already entered into a negative cash flow position as of last year I think - several years earlier than anticipated and that it will be completely depleted within a few decades. And that's only if you believe that the US government is able or willing to repay the debts owing to Social Security in full.

    You can't square the math here - "When Social Security first started, there was 16 workers for every retiree. Today there are three workers for every retiree and soon there will be only two for every retiree"

    The question is how will those two workers pay for every retiree in a few years time? The basic problem that you seem to have missed is that despite the fact that social security pays out for a longer period of time because people live longer, it hasn't required workers to pay out more.
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    Sep 08, 2011 2:24 PM GMT
    meninlove said Good point, Realifedad,

    "But since the Insurance Co's Ponzi Schemes are for profit, Far Righter Repubs see them as OK, its only a 'bad' Ponzi Scheme if its run by Government."



    It continues to astound me how someone who claims to have any knowledge of finance can be so woefully ignorant... of finance (or math for that matter). At least bad insurers fail. What's the alternative to Social Security?

    Oh, that's right - higher taxes to pay for benefits of people who didn't pay enough for their own retirements.
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    Sep 08, 2011 2:29 PM GMT
    riddler78 said
    meninlove said Good point, Realifedad,

    "But since the Insurance Co's Ponzi Schemes are for profit, Far Righter Repubs see them as OK, its only a 'bad' Ponzi Scheme if its run by Government."



    It continues to astound me how someone who claims to have any knowledge of finance can be so woefully ignorant... of finance (or math for that matter).


    I'm just trying to keep to your own level of ignorance. icon_wink.gif

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    Sep 08, 2011 2:34 PM GMT



    Here's one; our house insurance went wayyyy up when hurricane Katrina happened. That was the excuse we were given, even though it happened many thousands of miles from us, we never had a claim, and we reside in a different country.

    Our extended benefits (private insurance for health costs not covered by the system) went up, and we got a letter from the co that said it needed to do this in anticipation of future claims by the upcoming bulge in retirees.
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    Sep 08, 2011 2:42 PM GMT
    meninlove said
    riddler78 said
    meninlove said Good point, Realifedad,

    "But since the Insurance Co's Ponzi Schemes are for profit, Far Righter Repubs see them as OK, its only a 'bad' Ponzi Scheme if its run by Government."



    It continues to astound me how someone who claims to have any knowledge of finance can be so woefully ignorant... of finance (or math for that matter).


    I'm just trying to keep to your own level of ignorance. icon_wink.gif



    Lol - except all you've done is highlight your own icon_wink.gif
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    Sep 08, 2011 2:45 PM GMT
    meninlove said
    riddler78 said
    meninlove said Good point, Realifedad,

    "But since the Insurance Co's Ponzi Schemes are for profit, Far Righter Repubs see them as OK, its only a 'bad' Ponzi Scheme if its run by Government."



    It continues to astound me how someone who claims to have any knowledge of finance can be so woefully ignorant... of finance (or math for that matter).


    I'm just trying to keep to your own level of ignorance. icon_wink.gif



    No, actually he proved you wrong and this was your best retort?

    Why are you against making SS and Medicare sustainable? We need to make them sustainable.
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    Sep 08, 2011 2:50 PM GMT
    meninlove said


    Here's one; our house insurance went wayyyy up when hurricane Katrina happened. That was the excuse we were given, even though it happened many thousands of miles from us, we never had a claim, and we reside in a different country.

    Our extended benefits (private insurance for health costs not covered by the system) went up, and we got a letter from the co that said it needed to do this in anticipation of future claims by the upcoming bulge in retirees.


    When insurers make mistakes in calculations they are required to correct them by adding capital in some way. Insurance also happens in cycles. One of the ways Warren Buffett made much of the initial capital he did was by not issuing policies when margins were tight in underwriting (this was when investment returns were low and competition was too high causing the premiums and returns combined to be too low).

    After disasters, because the availability of capital contracts, insurance premiums rise - because one capital event does affect others because ultimately most insurance gets reinsured - particularly in property and casualty for the rare events. It's this cost that tends to rise dramatically. The commodity that is most valuable after a natural disaster is capital.

    There's a big but here - and that's competition. Competition tends to erode the cost of premiums over time - because specialty insurers or regional ones that arent' affected by natural disasters a world away can charge less.... but there's a balance here. An insurer aggregates risks and therefore reduces it overall for everyone - such that if that specialty insurer or regional one were hit by one disaster they could be entirely wiped out - even if it were a 1/250 year event - which can happen. So the fact Katrina was unlikely would have also meant that their premiums helped to keep yours low before.

    On the issue of extended benefits - this also makes sense but you are free to shop around. Once they recognize the costs are going to rise, it is responsible for them to find a way to cover them or reduce coverage - this is not happening for Social Security.
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    Sep 08, 2011 3:28 PM GMT
    lol, Mock said, "No, actually he proved you wrong and this was your best retort?"

    Nope. It was quite deliberately lame.
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    Sep 08, 2011 3:29 PM GMT
    meninlove said lol, Mock said, "No, actually he proved you wrong and this was your best retort?"

    Nope. It was quite deliberately lame.


    No, he drew a clear demarcation on the comparing of SS and medicare to insurance.
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    Sep 08, 2011 3:31 PM GMT
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    Sep 08, 2011 3:53 PM GMT
    mocktwinkie said
    meninlove said
    riddler78 said
    meninlove said Good point, Realifedad,

    "But since the Insurance Co's Ponzi Schemes are for profit, Far Righter Repubs see them as OK, its only a 'bad' Ponzi Scheme if its run by Government."



    It continues to astound me how someone who claims to have any knowledge of finance can be so woefully ignorant... of finance (or math for that matter).


    I'm just trying to keep to your own level of ignorance. icon_wink.gif



    No, actually he proved you wrong and this was your best retort?

    Why are you against making SS and Medicare sustainable? We need to make them sustainable.




    Mock, Your last point is exactly my point, as I refered to with Romney's comback to Perry, We are not for ending the program but for making it sustainable and the way forward is as has been studied/figured out that I quoted above. First increase the age for drawing from SS, and why is it so hard for repubs to swallow going for increasing deductions by requiring deductions from a higher income figure as apposed to the lower income figure used now ? This is necessary to make the program sustainable. Insurance rates have gone up much faster than what is being suggested to make SS sustainable, But there again, Insurance is for profit so Repubs are for that, but against a govenment run program that is basicly the same thing. There is no reason that young men like yourself shouldn't be able to plan on also drawing SS upon your retirement. All that is necessary is the simple fixes above.


    I don't know where Riddler gets his figures but I've read several statements from SS that there are funds for several years into the future, but for some reason some far righter repubs are for ending it rather than for the fixes that will make it sustainable and those who want to end the program seem hell bent on scaring the public with dire reports, when there are simple fixes. and again, this SS is not a budget expense of the Feds, it is self funding. the Government owes over $2 trillion to the SS fund, so it must have been pretty well financed or that money wouldn't have been there.
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    Sep 08, 2011 4:21 PM GMT
    realifedad said
    mocktwinkie said
    meninlove said
    riddler78 said
    meninlove said Good point, Realifedad,

    "But since the Insurance Co's Ponzi Schemes are for profit, Far Righter Repubs see them as OK, its only a 'bad' Ponzi Scheme if its run by Government."



    It continues to astound me how someone who claims to have any knowledge of finance can be so woefully ignorant... of finance (or math for that matter).


    I'm just trying to keep to your own level of ignorance. icon_wink.gif



    No, actually he proved you wrong and this was your best retort?

    Why are you against making SS and Medicare sustainable? We need to make them sustainable.




    Mock, Your last point is exactly my point, as I refered to with Romney's comback to Perry, We are not for ending the program but for making it sustainable and the way forward is as has been studied/figured out that I quoted above. First increase the age for drawing from SS, and why is it so hard for repubs to swallow going for increasing deductions by requiring deductions from a higher income figure as apposed to the lower income figure used now ? This is necessary to make the program sustainable. Insurance rates have gone up much faster than what is being suggested to make SS sustainable, But there again, Insurance is for profit so Repubs are for that, but against a govenment run program that is basicly the same thing. There is no reason that young men like yourself shouldn't be able to plan on also drawing SS upon your retirement. All that is necessary is the simple fixes above.


    I don't know where Riddler gets his figures but I've read several statements from SS that there are funds for several years into the future, but for some reason some far righter repubs are for ending it rather than for the fixes that will make it sustainable and those who want to end the program seem hell bent on scaring the public with dire reports, when there are simple fixes. and again, this SS is not a budget expense of the Feds, it is self funding. the Government owes over $2 trillion to the SS fund, so it must have been pretty well financed or that money wouldn't have been there.


    The argument as made by SS that there are funds for several years into the future is what you misunderstand. They have lent the surpluses they have made to the US government - so they don't have this cash sitting around. The effect is that the beneficiaries of today are being paid for by the workers of today. With the significant rise in the number of beneficiaries, something has to give. It is also important to note that it has stopped being self funding. Today, beneficiaries draw down more than social security brings in.

    Now as for raising the social security age of draw down - this is only one of the things that needs to be done - but do you really see any Democrats making any proposals for this to happen?

    The simple fixes? One of the fundamental problems is that we live a lot longer than we have in the past. This means that either people should start paying more or the benefits have to be reduced. Something will give. Further - your argument that the amounts paid in should be increased to a higher income level ignores the simple fact that once you do so, without increasing benefits, this is simply a tax - and you further prove the point that social security is NOT self funding.
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    Sep 08, 2011 5:00 PM GMT
    Riddler, I did miss the point about the SS fund not being available for use because our Gov. barrowed from it. Then that just means the Gov will have to ensure the SS fund is refunded doesn't it. To make sure that doesn't cut off those on SS now, we need to soon increase the deductions, and why is that such a bad thing when those who pay more, do draw more and its just semantics as far as whether its considered self funded or not. Since everyone will eventually draw at retirement age the program will after these fixes go on being something all US retirees or the disabled can plan on.


    As for raising the age of retirment, that has been agreed on by key Dems, and I personally don't see it as a problem.


    I still say some in the Repubs are intent on killing SS and they are trying to make this problem much worse to fix than it is. SS has been very successfull in assisting our US elderly and there is absolutely no reason with these simple fixes ,that it will not be available for future retirees. Perry was completely wrong in saying that young people couldn't depend on SS when it can easily be fixed and made dependable like it has been up to now. Hell !!! even Romney says so !!!
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    Sep 10, 2011 2:20 PM GMT
    realifedad said Riddler, I did miss the point about the SS fund not being available for use because our Gov. barrowed from it. Then that just means the Gov will have to ensure the SS fund is refunded doesn't it. To make sure that doesn't cut off those on SS now, we need to soon increase the deductions, and why is that such a bad thing when those who pay more, do draw more and its just semantics as far as whether its considered self funded or not. Since everyone will eventually draw at retirement age the program will after these fixes go on being something all US retirees or the disabled can plan on.


    As for raising the age of retirment, that has been agreed on by key Dems, and I personally don't see it as a problem.


    I still say some in the Repubs are intent on killing SS and they are trying to make this problem much worse to fix than it is. SS has been very successfull in assisting our US elderly and there is absolutely no reason with these simple fixes ,that it will not be available for future retirees. Perry was completely wrong in saying that young people couldn't depend on SS when it can easily be fixed and made dependable like it has been up to now. Hell !!! even Romney says so !!!


    The other crux of the problem right now is that Social Security as it stands will pay out far more to current retirees than it does to future generations for which many will receive far less than they paid in.

    It can't be easily fixed without significant increases to taxes - and the liability in Social Security continues to grow as life expectancies rise.

    This is from a Newsweek column in 1967 on the beauties of Social Security -

    The beauty of social insurance is that it is actuarially unsound. Everyone who reaches retirement age is given benefit privileges that far exceed anything he has paid in -- exceed his payments by more than ten times (or five times counting employer payments)!

    How is it possible? It stems from the fact that the national product is growing at a compound interest rate and can be expected to do so for as far ahead as the eye cannot see. Always there are more youths than old folks in a growing population.

    More important, with real income going up at 3% per year, the taxable base on which benefits rest is always much greater than the taxes paid historically by the generation now retired.

    Social Security is squarely based on what has been called the eighth wonder of the world -- compound interest. A growing nation is the greatest Ponzi game ever contrived.


    It's damning because they knew it from the beginning. Social Security works if there are
    (a) a lot more workers than there are retirees
    (b) if the life expectancy of people does not rise - or the payout period does not grow
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    Sep 10, 2011 2:47 PM GMT
    riddler78 said

    It continues to astound me how someone who claims to have any knowledge of finance can be so woefully ignorant... of finance (or math for that matter). At least bad insurers fail.
    They do? Hmm news to me! AIG...............
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    Sep 10, 2011 3:00 PM GMT
    TropicalMark said
    riddler78 said

    It continues to astound me how someone who claims to have any knowledge of finance can be so woefully ignorant... of finance (or math for that matter). At least bad insurers fail.
    They do? Hmm news to me! AIG...............


    Except (a) AIG was bailed out (or rather, their failure has been pushed out) by the US government probably more to prevent the European banking system from failing and (b) it didn't falter because of a ponzi scheme - but rather because of a misinterpretation of risks and (c) AIG is in the process of failing - and most of its assets have been auctioned off or at least are in the process of being sold off with their contracts being wound down. So does that qualify then as "news" then to you?
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    Sep 10, 2011 4:17 PM GMT
    riddler78 said
    realifedad said Riddler, I did miss the point about the SS fund not being available for use because our Gov. barrowed from it. Then that just means the Gov will have to ensure the SS fund is refunded doesn't it. To make sure that doesn't cut off those on SS now, we need to soon increase the deductions, and why is that such a bad thing when those who pay more, do draw more and its just semantics as far as whether its considered self funded or not. Since everyone will eventually draw at retirement age the program will after these fixes go on being something all US retirees or the disabled can plan on.


    As for raising the age of retirment, that has been agreed on by key Dems, and I personally don't see it as a problem.


    I still say some in the Repubs are intent on killing SS and they are trying to make this problem much worse to fix than it is. SS has been very successfull in assisting our US elderly and there is absolutely no reason with these simple fixes ,that it will not be available for future retirees. Perry was completely wrong in saying that young people couldn't depend on SS when it can easily be fixed and made dependable like it has been up to now. Hell !!! even Romney says so !!!


    The other crux of the problem right now is that Social Security as it stands will pay out far more to current retirees than it does to future generations for which many will receive far less than they paid in.

    It can't be easily fixed without significant increases to taxes - and the liability in Social Security continues to grow as life expectancies rise.

    This is from a Newsweek column in 1967 on the beauties of Social Security -

    The beauty of social insurance is that it is actuarially unsound. Everyone who reaches retirement age is given benefit privileges that far exceed anything he has paid in -- exceed his payments by more than ten times (or five times counting employer payments)!

    How is it possible? It stems from the fact that the national product is growing at a compound interest rate and can be expected to do so for as far ahead as the eye cannot see. Always there are more youths than old folks in a growing population.

    More important, with real income going up at 3% per year, the taxable base on which benefits rest is always much greater than the taxes paid historically by the generation now retired.

    Social Security is squarely based on what has been called the eighth wonder of the world -- compound interest. A growing nation is the greatest Ponzi game ever contrived.


    It's damning because they knew it from the beginning. Social Security works if there are
    (a) a lot more workers than there are retirees
    (b) if the life expectancy of people does not rise - or the payout period does not grow


    -------------------------------------------------------------------------------------------------
    Then increase the age of eligibility as has been agreed on by many dems


    Increase the income level from which deductions are taken from (my latest info.) $102,000 to $120,000 , and quit allowing the Government to take from the SS funds, which from the latest info i've read stands at over $2 Trillion the Gov. owes the fund.

    These steps and other tweeks to Medicare will make the SS program sustainable and therefore can be relied on even by todays young workers, just like it will be for me at my age of 58.
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    Sep 10, 2011 4:33 PM GMT
    realifedad said
    riddler78 said
    realifedad said Riddler, I did miss the point about the SS fund not being available for use because our Gov. barrowed from it. Then that just means the Gov will have to ensure the SS fund is refunded doesn't it. To make sure that doesn't cut off those on SS now, we need to soon increase the deductions, and why is that such a bad thing when those who pay more, do draw more and its just semantics as far as whether its considered self funded or not. Since everyone will eventually draw at retirement age the program will after these fixes go on being something all US retirees or the disabled can plan on.


    As for raising the age of retirment, that has been agreed on by key Dems, and I personally don't see it as a problem.


    I still say some in the Repubs are intent on killing SS and they are trying to make this problem much worse to fix than it is. SS has been very successfull in assisting our US elderly and there is absolutely no reason with these simple fixes ,that it will not be available for future retirees. Perry was completely wrong in saying that young people couldn't depend on SS when it can easily be fixed and made dependable like it has been up to now. Hell !!! even Romney says so !!!


    The other crux of the problem right now is that Social Security as it stands will pay out far more to current retirees than it does to future generations for which many will receive far less than they paid in.

    It can't be easily fixed without significant increases to taxes - and the liability in Social Security continues to grow as life expectancies rise.

    This is from a Newsweek column in 1967 on the beauties of Social Security -

    The beauty of social insurance is that it is actuarially unsound. Everyone who reaches retirement age is given benefit privileges that far exceed anything he has paid in -- exceed his payments by more than ten times (or five times counting employer payments)!

    How is it possible? It stems from the fact that the national product is growing at a compound interest rate and can be expected to do so for as far ahead as the eye cannot see. Always there are more youths than old folks in a growing population.

    More important, with real income going up at 3% per year, the taxable base on which benefits rest is always much greater than the taxes paid historically by the generation now retired.

    Social Security is squarely based on what has been called the eighth wonder of the world -- compound interest. A growing nation is the greatest Ponzi game ever contrived.


    It's damning because they knew it from the beginning. Social Security works if there are
    (a) a lot more workers than there are retirees
    (b) if the life expectancy of people does not rise - or the payout period does not grow


    -------------------------------------------------------------------------------------------------
    Then increase the age of eligibility as has been agreed on by many dems


    Increase the income level from which deductions are taken from (my latest info.) $102,000 to $120,000 , and quit allowing the Government to take from the SS funds, which from the latest info i've read stands at over $2 Trillion the Gov. owes the fund.

    These steps and other tweeks to Medicare will make the SS program sustainable and therefore can be relied on even by todays young workers, just like it will be for me at my age of 58.


    What they should do is make Social Security independent - or better yet, let others maintain their own accounts / buy actual insurance/annuities. As it stands, Social Security is not self funding - but it should be - but it was created to be an instrument of the state (its history in its way is ingenious).
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    Sep 10, 2011 4:46 PM GMT
    What astonishes me is this Republican claim that Social Security is a Ponzi scheme. No, it is INSURANCE, into which you pay. Nor is it an entitlement program, in the strictest terms, lumping it into programs like welfare.

    If SSI is a Ponzi, then so are all private life insurance programs. Because everyone is going to die, just like most workers will live long enough to draw upon their SSI benefits.

    What was supposed to happen was that the SSI Trust Fund would grow on its own (and that's without privatization, which would have bankrupted it during the Bush Recession). What happened instead was Congress has raided the Trust Fund too often and too much, for pork barrel, for wars, and to cover their general fiscal mismanagement.

    Both parties share some blame, but none like the Republicans do. The Party of fiscal responsibility is as phony as all its other claims. And why do Republicans want to eliminate Social Security and Medicare? Because employers, especially the large corporations who are their biggest campaign contributors, also have to pay into those programs.

    So Republican lawmakers are being bribed (the laws were simply changed to term these bribes "political contributions") to kill Social Security, since it has little direct effect on the workforce. It's a program for when you're older and likely retired, no longer a concern for the corporations.

    The element being missed, however, that was understood long ago during the Great Depression by the Democrats, is that if ordinary people have money in their pockets they will spend it, on goods and service that stimulate the economy. What Republicans want to do today is put money in the pockets of their rich campaign contributors, who can hardly spend any more, or who spend it in ways that fail to help the economy, while millions starve and spend nothing.

    There are 2 ways the Republicans fail: on economic theory, and in common humanity. But so long as they think it will keep getting them elected, and being in power, to Hell with everyone else.
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    Sep 10, 2011 4:53 PM GMT
    Art_Deco saidWhat astonishes me is this Republican claim that Social Security is a Ponzi scheme. No, it is INSURANCE, into which you pay. Nor is it an entitlement program, in the strictest terms, lumping it into programs like welfare.

    If SSI is a Ponzi, then so are all private life insurance programs. Because everyone is going to die, just like most workers will live long enough to draw upon their SSI benefits.


    Wrong. From earlier:

    Sorry, your premise is wrong. You just don't seem to understand insurers. In insurance, you are required by law to have enough assets on hand to cover probable outcomes discounted to present value - it's a simplified explanation granted, but compare that to Social Security.

    Social Security knows it does not have assets to cover those "insured" - in fact they are quite open about the fact they have already entered into a negative cash flow position as of last year I think - several years earlier than anticipated and that it will be completely depleted within a few decades. And that's only if you believe that the US government is able or willing to repay the debts owing to Social Security in full.

    You can't square the math here - "When Social Security first started, there was 16 workers for every retiree. Today there are three workers for every retiree and soon there will be only two for every retiree"

    The question is how will those two workers pay for every retiree in a few years time? The basic problem that you seem to have missed is that despite the fact that social security pays out for a longer period of time because people live longer, it hasn't required workers to pay out more.