Re: Question about President's Social Security plan

From: The Trucker (mikcob_at_verizon.net)
Date: 01/11/05

  • Next message: Bill: "Re: Question about President's Social Security plan" 
    Date: Mon, 10 Jan 2005 20:04:00 -0800

    Jim Blair wrote:

    >
    > "The Trucker" <mikcob@verizon.net> wrote in message
    > news:crm93a03a@news3.newsguy.com...
    >> Jim Blair wrote:
    >> >> >> >> "Jim Blair" <jeb@wisc.edu> wrote
    >> >> >> >>
    >> >> >> >> > I am puzzled by the politics of this debate. Bush wants to (in
    >> >> > effect)
    >> >> >> >> > reduce the FICA now with the restriction that the tax
    >> >> >> >> > reduction be
    >> >> >> >> > invested/saved for future retirement. Why do those who
    > recognize
    >> >> > that
    >> >> >> >> FICA
    >> >> >> >> > is simply a regressive tax on wages not support Bush on this?
    >> >> >> >>
    >> >
    > ......
    >>>..... Do we agree that
    >> > there are 2 main problems? Demographics and regressivity?
    >
    > Trucker Coburn:
    >>
    >> No! We do not agree. I see that demographics is a problem if wages
    >> continue to be suppressed and _real_ capital is not properly developed.
    >> But proper capital development and improving wages are the correct
    >> solution to the supposed demographic problem. ....
    >
    > Hi,
    >
    > The US demographics are a problem for Social Security BECAUSE Social
    > Security is funded entirely by the FICA which is a tax on the wages of US
    > workers.

    I do not support that method of funding but it is the current method.
    NOW THEN: The point, Blair, is that if increasing technological
    innovation and capital development significantly increases wages then
    there should be no problem. It should be possible for less workers to
    support the society as a whole while working _LESS_ than their
    parents did to support them and their grandparents.

    >>...With proper technological
    >> development there comes a reduction in jobs, moron. But a bean counting
    >> conservative liar cannot come to grips with that and, instead, attempts
    >> to prevent progress and expand the population so as to maximize rents.
    >> That is what B-Liar would call being out of contact with reality. I
    >> do not like the "reality" that bean counting conservative nincompoops
    >> are currently in charge of the US government.
    >>
    >> > The "regressivity" may not be "real", (I agree that it is real) and may
    >> > not be as severe as you claim. See Hummel on this point.
    >>
    >> Hummel makes far too much out of the fact that the lower paying tax
    >> payers get a larger return per dollar. What he fails to understand,
    >> as do most bean counters, is that 15% of my wages @ 25K is a lot
    >> harder to bear than 15% of my wages at 85K even though the actual
    >> dollar amounts a very different.
    >
    > As I said, the "regressivity" of the SS system is debateable. The FICA is
    > very regressive, the payouts less so. If you compare who is collecting SS
    > to
    > who is paying in, it looks very regrssive. If you compare what people pay
    > in to what they get back, lower incomes fare better than higher incomes.

    So remove the cap and cut the rate. Or a better solution is to do away
    with the FICA tax and fund SS from general revenue and borrowing just
    like everything else. It comes down to your defending an inappropriate
    method to supposedly "fix" SS. Basic lying.

    >>
    >> Not a problem. Many ways to do it. e.g. remove the cap and reduce
    >> the FICA tax to that which is needed CURRENTLY while leaving the
    >> benefits side exactly as it is. Why is this so difficult for you
    >> Blair?
    >
    > Curious what you mean by "leaving the benefits side exactly as it is".
    > You
    > mean never have a means test? Social Security to people no matter how
    > rich they are, or no matter their income?
    >
    > And do you mean furure retirement payments tied to inflation, or to
    > average wages?

    That actually works. Especially if the income tax is highly
    progressive and the SS benefits are funded by said income tax.
     
    >> > The "demographic problem" IS real, and cannot be fixed by any act of
    >> > Congress.
    >>
    >> WRONG. Congress can get us out of Iraq and start building infrastructure
    >> and _real_ capital instead of seeking rent in the middle east. That
    >> means really good jobs and less of them in the future (and more real jobs
    >> right now even). The actual translation for the mentally impaired is
    >> that the fewer workers can support many more people while working _LESS_
    >> than they would have under the Republican anal retentive rent seeking
    >> methodology. If one considers the current bean count analysis of the
    >> problem one sees the lack of vision and the hope that NOTHING will
    >> change. And the Republicans will do all they can to make sure that
    >> nothing does change.
    >
    > More investment and fewer workers will not help Social Security as long as
    > it is funded by FICA.

    WRONG!!! Though it would be far better to fund SS from the same
    revenue stream as everything else with the absolute insistence that
    such spending is nondiscretionary just as now and with benefits
    the same as now, it is a lie to say that more investment in _real_
    technology and _real_ capital development (I am speaking here of
    "infrastructure" as well as privately owned _real_ capital) would
    (supposedly) increase wages thus making it possible to provide
    revenue necessary to support the SS system.

    >> > But, sure, you can continue to believe that regressivity is the major
    >> > problem.
    >>
    >> Regressivity IS the major problem in the FICA tax.
    >
    > And I agree.
    >
    >
    >>....The major overall
    >> problem is Republicans. That includes the Republicans in the
    >> Democratic party and the Republicans in the Libertarian Party
    >> (The Royal Libertarians).
    >
    > So by "Republican" you mean anyone from any party that supports the US
    > Social Security system?

    No Blair. I mean a rent seeking anal retentive, authority worshipping
    nincompoop.

    > Starting with FDR I assume?

    More painting of one's opponent and ascribing positions not in any
    way taken by the opponent. It's called lying, Blair, and the question
    marks don't really make any difference.

    >>
    >> >>....I seek to maintain the benefits side of
    >> >> the Social Security system while altering the funding side. I am not
    >> >> interested in keeping "IT" as "IT" is.
    >
    > And I thought I that somewhere you proposed a means test?

    I have, in the past, proposed such a thing and it could still be
    beneficial if the Republicans insist on keeping the current
    piss poor income tax system that does not appropriately tax
    or recover economic rent. However, if SS benefits are funded
    from a highly progressive income tax system or a system of
    land rent recovery then the means test might not be needed.

    >> >
    >> > Neither am I. Because SS can't stay as it is. It must change. The only
    >> > questions are "when" and "how".
    >>
    >> On that we seem to agree.
    >>
    >> >>....There are, simply stated, several
    >> >> ways to maintain and enhance the old age and disability system ....
    >> >
    >> > I agree.
    >> >
    >> >
    >> >>...(Social Security).
    >
    > jeb:
    >> >
    >> > But when you say Social Security, it sounds like you are restricting
    > your
    >> > options to the framework of the existing US program.
    >>
    >> I have been very clear in my proposals to ENHANCE Social Security....
    >
    > Every change is to *enhance* Social Security. Even Bush's.

    On that we have a very serious disagreement. The Proposal offered by
    Pinocchio Bush does nothing but undermine the current system while
    repaying off his political supporters on Wall Street. For Bush and
    the Republicans it is a twofer. It gets them more campaign money if
    not personal money, and it works to destroy the current SS system
    by underfunding it in the future.

    >> without directly enslaving the people in less developed nations.
    >
    > Explain "directly" in the above.
    >

    It is far easier to say that if a highly progressive income tax
    is employed to fund SS then the profits of multinational corporations
    and income to shareholders will be taxed. As such, there is an
    indirect tax on all owners and producers no matter where the production
    may take place. And if the corporation wants to move offshore and
    not pay US taxes then the corporation should receive NO services from
    the US at all. The Chinese can nationalize the Nike brand
    name and tell the American business people and "owners" to stick it.

    >>
    >> >>....George Pinocchio Bush and the prancing pig Republicans
    >> >> have yet to suggest any of these.
    >> >
    >> > I have lost track of what you mean by "any of these". But past "fixes"
    >> > for Social Security have included raising the retirement age, raising
    > the
    >> > FICA
    >> > income cap, reducing the increase in benefits, and raising the tax
    > rate.
    >>
    >> None of which are a total removal of the cap or doing away with FICA
    >> and funding the system with general revenues.
    >
    > I think your problem is that you don't understand what Bush is proposing.
    > Because you seem to favor what he wants.
    > The only difference I see is that you want to eliminate the income cap
    > while
    > he just wants to keep raising it.

    NO! He wants to _direct_ the money taken out of the SS system
    into specific pockets.

    < I agree with you that it should be
    > eliminated (made infinite), but how much income would a FICA on *wages*
    > above $200,000 bring in?

    I believe this to be somewhat irrelevant -- see below:

    > Don't most people in that income range get it from stock options, bonus
    > payments, and such?

    There was a time when that was the case. But now it is not. Executive
    salaries have risen substantially and stock options are no longer the
    preferred vehicle for bucks. There is no reason to fool around with
    capital gains now because the rather flat income tax allows the
    executives to simply take their income as salary. It seems that no
    matter how poorly the company might do the executives still get to
    slurp up what should have been operating revenue or shareholder
    dividends or profits. A return to a more progressive income tax,
    while leaving capital gains rates low would change this. I think
    that the Democratic congress of 1992 and Bill Clinton _proved_ this
    to be a fact.

    >>
    >> > And demographics predict that these "fixes" will reach a point of
    > failure.
    >> > Only the date of that failure is debated.
    >>
    >> And we see that funding from general revenue does not have this problem
    >> and that removing the cap and reducing the current rate will have
    >> positive economic impact in the long haul.
    >
    > Bush want to collect less from the FICA, and make up the difference from
    > general revenue.

    I think you have your wires crossed.

    >> >>....Certainly the piece of pig crap
    >> >> being spooned about by you and your Republican pals is the worst of
    >> >> the lot......
    >
    > jeb:
    >> >> >
    >> >> > Cutting the FICA rate won't solve the demographic problem.
    >>
    >> This assumes that younger people will not invest their increased
    >> real wages.
    >
    > That is why workers would not get the FICA reduction unless they invested
    > the FICA reduction.

    Thank you for agreeing with my point about Republican authoritarianism.
    Instead of any kind of "free market" or personal decision making
    here for the current taxpayers, the Pugs want to tie their hands and
    feed money to Wall Street.

    >>
    >> >> > And
    >> >> > removing the
    >> >> > earnings cap would help some, but would not solve the problem that
    > SS
    >> >> > will
    >> >> > someday face.
    >>
    >> Again you assume that the government (= George Bush forcing people
    >> to give mon ey to Wall Street) can invest _better_ than the individuals
    >> in the society.
    >
    > ???? And here you have it exactly backwards. Current FICA "forces" people
    > to give their retirement to the government. Bush wants them to have the
    > OPTION
    > of investing it. In stocks or bonds or CD's or mutual funds of their own
    > choice. Individuals make the decisions for themselves. Unlike now.

    As I said: If they want to "invest" in gold or land or use the money
    to start their own business that Pinocchio has _NO_. Just cut the
    tax and let the people do as they will.
     
    >>..Don't like free markets, Blair?
    >
    > ???? You are the one saying that individual workers should not be given
    > an option.

    NEVER SAID THAT! I said the tax rate should be cut (to zero preferably)
    and that gives the individual workers all the choices they could possible
    have. There is no excuse for FORCING the workers to use the savings
    as Pinocchio Bush and the prancing pigs think best. Pinocchio is just
    using government to direct investment decisions that should be made
    by the individuals in the society. Social Security is NOT an investment,
    Blair, and it never has been. It is a social insurance system and it
    has been paid for by workers only. It is high time that the rest of
    the people in this society (the rich) started paying a share of these
    costs.

    >>
    >> >> > You offer a band-aid when radical surgery is needed.
    >> >>
    >> >> I also gave you the radical surgery solution: Keep the benefits side
    >> >> of the program exactly as it is and simply repeal the FICA tax.
    >> >> Adjust
    >> >> the income tax to cover the costs. All done, thank you.
    >> >
    >> > End the FICA fund future benefits from the income tax? Is that your
    >> > "solution"?
    >>
    >> That is ONE of the several proposals that will work to eliminate the
    >> supposed "demographics" problem by allowing the younger generation
    >> to _invest_
    >
    > Yes. I agree.
    >
    >>...by getting George Bush and his prancing pigs out of
    >> their lives.
    >>
    >
    > ??? Or who ever is President in 20 or 30 years? Private investments
    > replacing the government run Social Security system.
    > That is what Bush is proposing.

    NO. It is NOT what Pinocchio Bush is proposing. He is proposing to
    divert money from SS into the pockets of the Wall Street Weasels.
    There should always be a Social Security Insurance system that pays
    benefits to the elderly and the disabled. This has NOTHING to do
    with "investing". People should "invest" as they see fit outside
    of the Social Security system and those that make good investments
    should have a much better retirement than those who do not. SS is
    a different kettle of fish. 

    -- 
"I know no safe depository of the ultimate powers of society but
the people themselves; and if we think them not enlightened enough
to exercise their control with a wholesome discretion, the remedy
is not to take it from them, but to inform their discretion by
education." - Thomas Jefferson.  http://GreaterVoice.org
  • Next message: Bill: "Re: Question about President's Social Security plan"

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