You are wrong when you say that unless we increase the retirement age, social security will not survive. It's one of several options.

For example, without making ANY changes whatsoever to current taxation, social security could continue as is until 2037, at which point it could continue to pay 75% of current benefits (yes, adjusted for inflation) in perpetuity.

Reducing benefits to 75% is probably less desirable than increasing retirement age by 5 years, but reducing benefits to 95% NOW and increasing retirement age by 2 years might be better than both.

On the funding side (a stickier issue during a recession) we currently cap taxation for social security on the first $115,000 earned (from memory, might be less). Increasing that cap would generate more revenue. Creating a donut hole where taxation stops at say, $120,000 and then resumes at a smaller rate at $250,000 before stopping again at $500,000 would also generate more revenue.

Basically you have 3 options: delay benefits, reduce benefits, or increase revenue through taxation. You don't have to use just one. And there are even more options available. You could offer more retirement age options where if you delay benefits further, you get larger benefits (this option already exists).


I like Esquire's idea to bring together former politicians from both sides to take a serious look at these issues, and I'm glad you made the thread. I just wanted to correct what I think is a very pervasive misconception right now about social security.

 

Originally Posted by Underdog34

You are wrong when you say that unless we increase the retirement age, social security will not survive. It's one of several options.

Fair point. I was just parroting the consensus of this group. I know very little about SS myself, so I'm not going to argue it at this point. I'll let ginwilly or someone else take up that argument. I think this was part of the compromise between the D's and R's. They tried not to raise taxes, in general.

My favorite ideas include eliminating subsidies to produce biofuels, eliminating farm subsidies, and cutting the dogshit out of military spending. these are the ones i would go to the mat on at this point. I'll have to learn more about SS and the problems/etc.

EDIT - I think I have heard on multiple occasions that the reason SS is in trouble is because we have been "borrowing" from it all along while it had a surplus, and now that its in trouble we are discussing cutting benefits. Sucks for everyone that paid in on the pretense that they would get it at the designated age, IMO. just doesn't seem fair.

also, I may decide very soon that lawrence o'donnell owns.

 

Originally Posted by Neeek

Fair point. I was just parroting the consensus of this group. I know very little about SS myself, so I'm not going to argue it at this point. I'll let ginwilly or someone else take up that argument. I think this was part of the compromise between the D's and R's. They tried not to raise taxes, in general.

My favorite ideas include eliminating subsidies to produce biofuels, eliminating farm subsidies, and cutting the dogshit out of military spending. these are the ones i would go to the mat on at this point. I'll have to learn more about SS and the problems/etc.

EDIT - I think I have heard on multiple occasions that the reason SS is in trouble is because we have been "borrowing" from it all along while it had a surplus, and now that its in trouble we are discussing cutting benefits. Sucks for everyone that paid in on the pretense that they would get it at the designated age, IMO. just doesn't seem fair.

also, I may decide very soon that lawrence o'donnell owns.

they voted in who they chose and got what they voted for, not our fault

the big problem in the current economy of raising the age limit or taxes, is you stifle job growth in the case of taxes or in the case or raising the limit add more workers into an unemployment line.

the big problem is that these things should have been looked at and discussed to death for prolly oh since they started but more in reality at least the last decade during the upkicks in the economy but as is the general consensus among most americans that just don't want to think that hard or far ahead wait till the excrement hits the fan.

 

Originally Posted by tekiller

the big problem is that these things should have been looked at and discussed to death for prolly oh since they started but more in reality at least the last decade during the upkicks in the economy but as is the general consensus among most americans that just don't want to think that hard or far ahead wait till the excrement hits the fan.

Balancing the budget is somewhat of a red herring. While nobody is in favour of the various examples of government waste, its just not as simple as balancing a budget. The USA is the largest economy in the world and is far more complex than the budget of even the largest corporation.

"The time to fix the roof is when the sun is shining" -some smart guy

sorry Heynow - exactly what you said.

mc, how do you feel about drastically cutting defense spending, like they propose. this accounts for over half their cuts.

I'm open to it in principle. In an organization as big as the US military, that hasn't undergone an audit since ~WW2, I gotta believe there are cases where we are not getting optimal value for our money.

 

Originally Posted by heynow21

Why don't you tell us

I don't think such a threshold exists. And you're right to imply that I couldn't beat Paul Krugman in a debate about this, that's why I picked a fight with sax.

 

Originally Posted by saxman

would it be wiser to adpot policies that attempt to lessen the blow of the collapse by temporarily increasing expenditures.

You mean like the Bush policies post tech bubble & 9/11? How'd that work out?

Always difficult debating this with you because we start from a different base (you being libertarian at heart). The problem is that the issues of social security shortfalls, medicare (health care) costs rising out of control, and military audits (your point) are not new problems. These have been bubbling for a long time and nobody was willing to deal with it. Now that we are in the middle of our greatest recesssion, people choose this particular time to cry foul. Not surprising really, but thats more of a political issue than an economics issue.

"you have slow decline that keeps hitting new lows cuz no one is sure when the hardest part of the bottom will be met because the gov't keeps stepping in."

I agree that its a huge problem with businesses being uncertain of the next step, and people (speculators) waiting on the sidelines to see what the next round of gov't action or inaction will be. I dont know how you prevent this.

It is not in the interest of politicians to balance the budget...why would they when they can CUT taxes and INCREASE spending without repercussions right now? If they say they are going to cut your medicare/medicaid you better be damn sure their opponent will blast them on that. Likewise with tax increases. Until politicians that don't care about getting reelected get into office, we will be running deficits for quite some time.

Younger generation is getting absolutely boned by politicians who are writing IOU's on our behalf.

well one way to get healthcare costs down is by getting rid of the gov't red tape, ask some people in the medical industry and theyll tell you.

and how do you stop buisnesses from being uncertain, umm isn't the answer kinda obvious

turbotax ftw

ya, I jumped to conclusions/missed your point. my bad.

Those military bases are pork on steroids.

Btw they invented the letter X a while back.

to neek, i won omfg i won yaaaaaaaaaaaaaaaaaaaaaahoooooooooo i fing won bishes, now what my prize :) lol

to heynow yea i think most can agree that we have far too many bases around the world and that could be scaled back, but i shy away from scaling back too much on personnel at this point specifically in our intelligence agencies, were already outsourcing to mercs and this is not good because their job depends on conflict so if they cant find it they will create it, so i would agree less spending on mercs but maybe more in the actual service in the intelligence agencies. with smart bombs and our ability to hit around the world from the air, i lean toward more intelligence and air strikes and less actual ground presence.

altho one thing we could do is say hey to countries were gonna get out of our lessen our presence, hey you want us to stay cool but youre gonna have to pay us..... yea a bit of a merc mentality but *shrugs* why not

If Pakistan turns into a failed state we are fucked. There are a lot of smart people who are really worried about nuclear terrorism.