January and February

[Guest]

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Show-me wrote:

It’s sad how they are willing to cut everyone’s pay, retirement, and benefit packages for the “good of the country” but not their own. Also did they not give the entire Federal Gov. a 3.5% pay raise recently after starting two expensive wars and cutting taxes? Also did they not recently raise the pay of the President? LEAD BY EXAMPLE! That just does not seem right to me. I still remember when Bush got elected and sent everyone a tax rebate. Can we say disposable income? Where did the money go? Did it really help the economy? Or was it a way to get a tax cut thru? I love to get my money back. But, are we paying a bigger price in the long run?

I still think CSRS was a better “retirement plan”.[/b]

I agree with Show-me. There are two classes of federal employees. The Congress and the President (the upper class) never once cut their own retirement benefits. The President and the Congressare not in FERS. Their retirement benefits aresublime, or as Mike would say, full of "largesse." It was the lower class federal workers who had their retirement benefits cut to balance the budget.And now, IMHO, a similar scenarioisplaying out on a much largerscale with Social Security. Remember thatSocial Security is/was/has always beenbased on income. If you currently make over the limit, you receive noSocial Security benefitseven though you may have paid into the system for 50 years. So whoare the ones to lose benefits under the new plan?Figure it out. It'ssimple.

In the 1980s, President Reagan had a massive deficit that he had to deal with. He attempted to help balance the budget on the backs of the lowly federal workers. In 2005, President Bushalso has a massive deficit that he has to deal with. He will nowattempt to balance the budget on the backs of working class Americans. As with CSRS, they will refer to this as"fixing the system." It's fixed all right.

 

[Mike]

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Turn of phrase: "he who makes the rules has the gold".

Note: cutting pay or benefits to Congress and the President should be done whenever it is done to the rest of the federal workforce. However, with that said, it would have negligable impact on the federal budget.

436 v. a few million...

More money could be saved by reducing Congressional staff and cutting back on the perks that members enjoy. Come to think of it, I'm not sure why senators are paid at all - the vast majority of them are extremely wealthy to begin with - and as for the president, he'll make six-figures for every speech he gives once he leaves office. Clinton has become a millionaire many times over just by opening his big yapper after leaving office. Now that is retirement. :shock:

 

[Guest]

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saraho wrote:

Chaplain wrote:

Social Security may be the mother of all pyramid schemes. It had to eventually implode under it's own weight, as any scheme like this does. It just played out over enough years most people didn't pay attention to what was going on. In fact, many actually beleived that they had an account into whichtheir contributions were deposited.

What if I told you that Social Security is currently solvent?

Myths and Truths About Social Security

By Karen Westerberg Reyes, March & April 2005


Yes, the system needs some adjustments, but we don’t need to destroy it in order to fix it.

Social Security is the ultimate support system, a monetary cushion for grandmothers and granddads, but also a lifeline for widows, widowers, divorcées, orphans, and people with disabilities. For the average American over 65, Social Security makes up nearly 40 percent of income. For about 20 percent, it is their only income. The system has worked well for some 70 years now with few adjustments. These days, it's on everyone's radar. That's because President Bush has put Social Security reform at the top of his second-term to-do list. He and many others argue that big changes are necessary if Social Security is to survive, much less thrive. But there are those, AARP included, who believe a radical overhaul could spell disaster—the end of Social Security as we now know it.

Is the current Social Security system really at death's door, or are the rumors of its demise greatly exaggerated? Following are some common misconceptions.

Myth: Social Security is broke.

Those who argue that Social Security needs a dramatic reorganization begin with this premise: the system is failing; Social Security isn't sustainable in its present form. From there, the argument goes that what's best for the country is some form of privatization. With privatization, a portion of the Social Security taxes now paid would be diverted into an account that each taxpayer would control themselves. (Under the current system, all surplus Social Security revenue is invested in special U.S. Treasury bonds.)

So, is Social Security about to go bust? Not by a long shot. In fact, Social Security is in better shape today than at any other time since it was enacted in 1935. That's because of some judicious adjustments suggested in 1983 by a commission set up by Ronald Reagan and headed up by Alan Greenspan. Since then, trust fund reserves have gone from nearly zero to $1.6 trillion.

Social Security trustees acknowledge that by 2028 the system will need to start redeeming the bonds in its reserve, but they calculate that the fund will be able to meet 100 percent of its obligations until 2042. By that date, the principal will be exhausted, but the system will still bring in enough revenue from taxes to pay nearly 75 percent of benefit amounts. (An even rosier Congressional Budget Office report says the system will be able to pay full benefits until 2052, and 80 percent after that.)

Myth: The fund starts getting into trouble in 2018.

Not true. The year 2018 is when Social Security benefit payments are expected to exceed payroll tax revenues. That's not exactly cataclysmic. Reason: from 2018 through 2027, incoming tax revenue combined with interest earnings will still be enough to pay benefits and build the trust fund balance. Beginning in 2028, as mentioned, the trust fund principal will have to be tapped, and that'll get us through 2042—even if we do nothing.

Clearly a tune-up is needed to extend Social Security's life beyond that horizon. "But dismantling the whole system would be like buying a new car because the one you have has a flat tire," says Peter R. Orszag, a senior fellow of economic studies at the Brookings Institution in Washington, D.C.

Myth: The Social Security reserves are only on paper.

Well, yes, but that paper is U.S. Treasury bonds, which have been earning a combined interest rate of about 6 percent a year. For more than 200 years, in good times and bad, during wars and depressions, American bonds have always paid off. They're one of the safest investments in the world. In 2003, some $80 billion, about 13 percent of Social Security's total income, came from the interest from these bonds.

Myth: The 77 million baby boomers marching toward retirement are going to break the system.

Advocates for radical reform point out that once the boomers retire, they will start taking more money out of the system than younger workers are putting in. The oft-cited statistic is that by 2040 there will be just two workers for each retiree. (Today there are just over three workers for each retiree.) But that fact, while accurate, fails to acknowledge that workers today are more productive, earn higher wages,

and plan to stay in the workforce longer—all factors that will help fill the future gap. In fact, in the near term, this population juggernaut, being at the peak of its earning years, is currently helping to amass a huge surplus in the fund.

Once boomers start retiring, sure, that's going to put a strain on the system. "But it isn't going to be Armageddon," says Kenneth S. Apfel, former commissioner of the Social Security Administration and current member of the faculty at the LBJ School of Public Affairs at the University of Texas at Austin.

We can strengthen Social Security by making small adjustments, just as we've done in the past. These include raising the cap on wages subject to Social Security (currently you're taxed on income up to $90,000) and investing part of the Social Security surplus in other vehicles that pay higher interest than Treasury bonds do.

Myth: A system of private accounts would save Social Security.

The buzz phrase being bandied about by those who favor privatization is "an ownership society." They favor taking a portion of Social Security taxes and diverting it to individuals to invest. They say such a system would give workers ownership of their money. It would allow taxpayers to put their own dollars into stocks, bonds, and other investments that would pay them a higher return.

Those who oppose privatization, including AARP, argue that setting up private accounts would effectively scuttle Social Security. "Siphoning money from Social Security will not strengthen it," says David Certner, AARP's director of federal affairs. "It will just make the problem much worse."

First, the transition costs alone would be crushing—as high as $2-$3 trillion, according to AARP's own economic analysis. "The amount of additional national debt that would generate could eat into any returns people might actually get from a private account system," says Barbara Kennelly, president and CEO of the National Committee to Preserve Social Security and Medicare, a 3.2-million-member organization located in Washington, D.C.

Second, diverting a portion of Social Security money to private accounts means that there would be fewer dollars available to pay Social Security benefits. That would leave the whole system with less of a reserve, as well as less cash on hand to pay beneficiaries. This situation would lead to hard choices: cutting benefits, raising taxes, or doing none of the above and watching the trust fund run out of cash sooner.

According to a letter entitled "The Consequences of Social Security Privatization," signed by Congressmen Charles B. Rangel (D-NY) and the late Robert T. Matsui (D-CA), diverting a portion of workers' current Social Security contributions to private accounts "blows a hole in the Trust Funds…and directly threatens our ability to pay current retirees." They predict that under privatization the trust fund reserves will be wiped out by 2021, a full 20 years sooner than if the system had been left alone.

Myth: Private accounts will give individuals more control.

People already have control over their money when they invest in private pensions, IRAs, and 401(k) plans. When combined with the solid foundation that Social Security provides, these are excellent vehicles for retirement savings. "What we should be doing is making these work better," says Orszag.

Myth: Individuals will get higher returns with private accounts.

Surely you can do better with your investments than a big bureaucratic government agency can, say those who favor private accounts. Well, the truth is, some people may do better. But who's going to pay for the care and feeding of all those who do worse?

"Under privatization, current workers will have to pay three times," says Certner. "Once to ensure the benefits for those currently at or near retirement, once for themselves, and once more for those whose investments didn't pan out." In the current Social Security system, the risk is near zero. You know it will be there regardless of what the market does. That's because U.S. Treasury bonds don't crash when the stock market does.

So what can be done? Yes, the Social Security system needs some work, but there's nothing so seriously wrong with it that some due diligence and nonpartisan intervention and planning can't repair. "There's no need to take the risky step of privatization," says Kennelly.

 

[Rolo]

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Ima hafta try and say this only once...

It's not the government's job to be our mommy and daddy and take care of us!



AH...MUCH BETTER.

 

[Guest]

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Well will probably get on the nice list very quickly here. You seem to eat anyone that does notagree with a select few very quickly. The select few seem to benot doing well in their TSP accounts, however.That is interesting.

Concerning the Social Security issue, I believe if the government took social security contributions out of my check for the previous 22 years that we entered into a contract. Not to say 22 years, I changed the contract and when you retire your benefits will drop 50% of what we told you year after year. There is no pending social security crisses.

This administration creates a crisses and then quickly has a solution, case in point; medicare crisses (when it was approved it would cost $250B)...less then a year later the price tag is over $750B, WMD then after there is no WMD we are spending democracy. What is China invadedNevada because they wanted to promoteCommunism?Now the"social security crisses"...there is a pattern here. This pattern is leading usto a cliff...

If the govt did not brake the publics trust by using the social security contributions by spending it and making the yearly budget numbers look more favorable...that is the bottom line.

Now you can see the old bait and switch. Present a budget then two day later do add on for things such as the War on Terror and state funding...that is why the U.S. dollar is getting smoke...Asian countries do not like the bait and switch and stand in front of them at the G7 and tell them the budget (which is a record) will be spend as you go and not run over $500B what is taken in. In your own household, how long would your budget last if you spent over 30% more thenyou took in?

The pattern continues...Iran here we come! Not sure where it is written anywhere that the U.S. is the only country allowed to have nuclear weapons...but we sure seem to enforce that rule.

 

[Show-me]

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Don't forget N. Korea.

 

[Guest]

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Pat_1111 wrote:

Concerning the Social Security issue, I believe if the government took social security contributions out of my check for the previous 22 years that we entered into a contract. Not to say 22 years, I changed the contract and when you retire your benefits will drop 50% of what we told you year after year. There is no pending social security crisses.

If the govt did not brake the publics trust by using the social security contributions by spending it and making the yearly budget numbers look more favorable...that is the bottom line.

Now you can see the old bait and switch. Present a budget then two day later do add on for things such as the War on Terror and state funding...that is why the U.S. dollar is getting smoke...Asian countries do not like the bait and switch and stand in front of them at the G7 and tell them the budget (which is a record) will be spend as you go and not run over $500B what is taken in. In your own household, how long would your budget last if you spent over 30% more thenyou took in?

The pattern continues...Iran here we come! Not sure where it is written anywhere that the U.S. is the only country allowed to have nuclear weapons...but we sure seem to enforce that rule.

 

[Guest]

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Wonder Women,

Thank you very much! I am sure I will be cut from the herd and slaughter soon for have a different view.

There was some very good people on this board that provided actual invesment advice and knowledge. Leo, Eurorate and others.

This board is quickly turning into a bunch of comics, jokes and cut up artists.

How you manage your TSP account will determine how you live in your retirement. It is become crystal clear that your social security contributions is as good as gone. You need to take that amount out of your future money coming in.

I am just waiting to get locked in the neck and slowly bleed. Just page down the board and read 95% of the posts...they are crap for someone trying to understand and learn about investing for their future. If I wanted to read jokes, cars to buy, etc, etc...I would do a search on that topic.

I have been watching this board for a long time. The board needs to get back on track. It is turning into a waste of time.

Thank you again. I will be happy to give you sites where there are people that talk about investments and not cut each other up if you want too.

 

[Guest]

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Another case and point I need to add before I get skinned alive:

If you have any knowledge of the TSP you will know the govt takes money out "they call it borrow" of the accounts to fund unfunded liabilities...which would mean with social security reform the govt would borrow against that too. The only thing I see that is going to happen is I am going to pay a management fee on my social security account and be told 20 years from now the TSP "lock box" is empty too.

Get any sleep?

 

[rokid]

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Pat_1111,

I'd like to see that list ofsites too.

Incidentally, I agree with your SS rant. The conservatives have wanted to get rid of SS since 1935. They believe that people should take responsibility for themselves and their financial well being.

Although that's a nice sentiment, the bottom line is that SS came into being because of market failure. Most people worked until they died, there was no retirement except for the rich, and the majority of the elderly were poor and relied on the charity of their children and/or the local community. Worse still, the "smart" people whowere invested,lost it all in the Depression! For example, my hard working grandparents lostafarm that had been in the family since 1837. Nobody's fault,just bad luck.

By the 1930s the country had a stark choice, institute a social safety netor face a revolution. The unions were not afraid to go into the streets, i.e. look up the Flint UAW in "The Battle of the Overpass" orthe Teamsters nearly anywhere. I grew up in Detroit. You didn't cross picket lines.

Since FDR was smart, he opted for the social safety net,including SS. SS was, and is, a spectacular success. The elderly, for the most part, don't live in poverty, enjoy good health, and live much, much longer than in the past.

The current administration wants to get rid of SS, period. There is no crisis - read the CBO's SS report. In addition, their rationale, there's a crisis because the economy won't grow, however, we'll fix it by investing in a growing economy, doesn't make sense. Either the economy will grow or it won't. Finally, the SS "problem" is only a fraction of 1% of the GDP. Based on those criteria, the tax cuts for the rich are a much bigger problem.

Personally, I don't want to live in a society that has the elderly sitting on corners with tin cups, cleaning my table at McDonalds, and greeting me at Wal-Mart until they drop dead. I'd like to see them baking cookies and doting on their grand children. Of course, I'd also like to see universal health care, an EPA that actually protects the environment, a balanced budget, an end to preemptive strikes, adequate force protection in Iraq, secure borders, peace in the Middle East etc. In other words, dream on......

Finally, you actually voted for this guy?:?

 

[Guest]

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Obviously, I agree with Pat_1111 and rokid concerning Social Security. This has been an issue of the extreme right since its creation. The effort to demolish it is not based in its solvency but in the results of the past election.

Rolo,

I don't know what to do with you. It's fascinating that you say that you don't want the government to take care of you, yet I don't see any corporations refusing oil depletion allowances or other types of welfare to the rich.

President Kennedy once said that if a free society cannot help the many who are poor, it cannot save the few who are rich. IMHO,we are presently on a perilous economic course.

 

[Wheels]

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saraho wrote:

This has been an issue of the extreme right since its creation. The effort to demolish it is not based in its solvency but in the results of the past election.

First of all, don't all of you jump down my throat at once, I do not endorse Bush's plan. However I have to throw the red flag on your above statement (and other's like it). It has been in fact democrats who for yearshave been screaming about saving SS before it's too late, and now that they don't like Bush's scheme they are screaming, "Whoa, what's the rush!"

On a completely separate topic, whereabouts in the Northeast are you located. I'm in Southern NH (don't worry, I won't stalk you).

Dave

Pat_1111 - I also miss Eukrate. His posts were not frequent but they were always right on the mark.

 

[Rolo]

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saraho wrote:

I don't know what to do with you.

ehehehehe...LOL....I hear that a lot. You were shaking your head, huh? If you weren't typing, I bet your palms would be in the air, too.

saraho wrote:

It's fascinating that you say that you don't want the government to take care of you, yet I don't see any corporations refusing oil depletion allowances or other types of welfare to the rich.

Whoa! Look out, Captain Ahab! There's a red herring bigger than yer whale! Watch that leg!

What does corporations/oil depletion allowances have to do with anything in this conversation? I don't even know whatdahell you are talking about. Do those allowances end in 5? behehehe.

This liberal gubamint has let Americans turn into a bunch a fat, whiney, freeloaders. Even the rugged, pull-themselves-out-from-nothing Depression Era/WWII types have turned into a bunch of whiners with their hands out. They killed our heroes! Now, the only hero we have is da gubamint and how it can hurt those who make do for themselves.

It is simple: Americans need to take care of their own sh..tuff. Here's my rendition ofthe liberal philosophy of "Keep the government out of the bedroom!": Keep the government out of the whole house!

 

[Mike]

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The Senate Democratic leader was in favor of partial privatization as recently as 1999. Now that it is proposed by Bush, he's strongly against it. Hmmmm.

 

[Guest]

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Mike,

In 1999 we were running a budget surplus and could afford to fund personal accounts. The budget now and the budget then are two different animals.

Picking a line that proves you case does not give the board "the true" reason he is against it now.

 

[cowboy]

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Mmmmm? We could go down the road of bashing each party guys, but the truth is the US house and Senate are a bunch of yes people to their party planks and the government is in the back pocket of big business of which ever party is in the house. Health care and Insurance and government retirement will milk you dry until you stop paying for it.

 

[Mike]

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Nice try at rationalizing it. Unless the guy is a total idiot, he'd know full well that the economic conditions of 1999 wouldn't last forever - that's why they call it a "business cycle" - because each point is temporary.

Let's say they passed private accounts into law then. Does that mean that he'd want to take them away every time the economy sputtered or the federal budget went in the red? Please.

 

[cowboy]

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Mike wrote:

The Senate Democratic leader was in favor of partial privatization as recently as 1999. Now that it is proposed by Bush, he's strongly against it. Hmmmm.

This could be true, but the senate Democratic leader is no longer in office. Isn't it strange that the democratic leader was out of a Republican state.

 

[Guest]

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Everyone in early 1999 thought the stock market was going to return 30% a year, every year...which probably weighed heavily on his comment that privation was a good idea....don't you think? Just like now...everyone only thinks the stock market only goes up...just like 2000 the stock market is now a casino...AHHH the news was NOT THAT BAD...shuffle up and deal.

Maybe he understand now the blood bath between 2000-2002 and he understands that we are headed for another blood bath again. If you have been in the market longer then a couple years you can see that we are in a major bubble again that was brought on by lowering the fed rate to 1% and everyone refinancing their homes and taking their home equity to play in the casino now called the stock market...come on 777s!

Having social security tied to the stock market is putting your eggs into one basket...only a fool would do that. This is just a mask to show that all the contributions that were taken in were spent and now it is time to pay them back they are doing the two step....it is like a barker at a carnival...and you are being taken in. There is a fool born every minute...however the none fools are rather pissed off...keep that smile on your face because reality is painful if you can see it.

 

[Show-me]

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Humm. This style of writing looks very familiar. Is that you.........:shock: