Re: Bush and O'Reilly, in denial.


"tonyp" <tonyp@xxxxxxxxxxxxx> wrote in message
news:BbKdnSZQh8L-GhLenZ2dnUVZ_tWdnZ2d@xxxxxxxxxx
>
> "Jim Blair" <jeb@xxxxxxxx> wrote
>
> > No. I never intend to sell any of that CREF stock. I'll collect only
the
> > dividends when I retire.
>
>
> Jim, if you have a large enough portfolio that you can live off the
> _dividends_, I am very glad for you, because you're a nice guy. But if
you
> think your portfolio is _typical_, then you're nuts.

Hi,

Its not just the dividends and interest from those stocks and bonds. I
also have Social Security (for me and my wife) plus she is now collecting a
pension from the state of Wisconsin and I will beginig next year when I plan
to retire.


But anyone can do what I did: save and invest 5-10% of income while working,
and put it into a mutual fund retirement account. And that was easier for
me than for some because I could deduct it from my taxes. I say give that
same break to those with lower incomes as well.

In my case it was 5% of my income matched by 5% from Milton College. And
strangely enough, a fellow faculity member turned down that option saying it
would mean 5% less take home pay. I could not convince them that they were
actually turning down a 5% pay raise.

> > ???
> > If there are not more workers in each generation, the retired cannot
> receive
> > expanding benefits except by FICA collecting more from each worker.
> > And just living longer means receiving more in SS payments.
>
>
> More what? More nominal dollars? You can't be that disingenuous. So you
> must mean more "constant dollars".

The current system pays in CPI corrected dollars (which likely means
increased "constant dollars"), once you begin collecting. But later
generations begin with an ever lower fraction of their income while working.

But people who live longer collect more. Nominal, constant or whatever kind
of dollars.

>....Now, if you stop grinding your axe for a
> minute and think about it, you might realize that the _real_ question can
be
> posed in _real_ terms: what fraction of GDP (that which is produced by
> "workers") do retirees get? The GDP is all there is to divvy up, no
matter
> how you define "constant dollars". And GDP, however you measure it, tends
> to go up in real terms: the goods and services we produce are not only
> "more" but "better" every generation. If you can postulate an
> ever-increasing ratio of retirees to workers because of longevity
increases,
> how can you deny the possibility of ever-increasing productivity among the
> workers?

You are confusing GDP with wages. The US Social Security system is not
funded from the GDP, but from wages only.
That is why Bush had the right idea: fund retirement from the global GDP.

Workers don't get all of the gains from increased productivity, and even the
gains they do get are not all in the form of higher wages.

>
> I have to suppose that what you think is this: as workers get more
> productive, their standard of living should go up compared to that of
their
> parents, grandparents, and (increasingly) great-grandparents.

Yes.

>.....It is not
> fair for government to siphon off some of their increased output to
support
> those pesky, lingering ancestors. What you don't get is that "workers"
are
> not interested in taking the old folks in to live with them. They would
> rather pay the taxes which allow grandma to maintain her own home.

Sure. But it is not necessary to take an ever higher fraction of the wages
of current US workers to support that ever larger population of the retired.

They can be supported at least in part from the expansion of the global
economy.

Just consider what if retirees in Florida were supported entirely by a tax
on the wages of Florida workers. They would then be a drag on the Florida
economy. But instead they are a boost to the economy. Because their income
is largely from outside the state: from US Social Security plus pensions
from where they lived before they moved to Florida to retire, and from
interest and dividends from companies all over the world.

> > But with a retirement based on investment in the global economy, you can
> > work 40 years and then retire on the same income you had while working,
> even
> > if you live "forever".
>
>
> Back to your old claim that _everybody_ can get 7% real returns, eh?

Sure. You think that there is only so much new capital that the world can
usefully employ? And if more is invested by me, it will reduce the return
to you?

>.... Have
> you figured out yet why that does _not_ lead, rigorously and
mathematically,
> to a world where every baby is born a millionaire and nobody ever has to
> work again?

Only as a limit at infinite time. But babies can be born to families that
are ever richer (in absolute terms), and have the option of working an ever
smaller fraction of their lifetime. Actually, that is happening now.

> > A- Even Bush did not propose that workers put ALL of their FICA into
> private
> > investments, only a fraction of it. SS would continue to exist; and
with
> > means testing it would remain as a "back up" for the impoverished
elderly.
>
>
> Maybe we can reach consensus after all. How about this: raise the FICA
> cap, and impose means testing on SS benefits.

And also let workers deduct some of their FICA if they invest it for their
retirement?
I would suppor that package.


>.....We don't really know (because
> we postulate income mobility) whether today's $500K/yr lawyer will in fact
> retire with a comfortable nest egg, any more than we can really know
whether
> today's taxi-driving aspiring novelist might retire with royalties still
> flowing from his 7 best-sellers. So we tax current income, without a
cap,....

The income tax does that now. Are you mixing "income" and "wages"? The IRS
with the FICA?

> and pay decent benefits, _with_ a means test, at retirement. The lucky
ones
> get "less than they paid in", the unlucky ones get "more than they paid
in".
> Just like ... (wait for it) ... insurance!

But unlike the current Social Security system.

And you say a means test "at retirement"? But what if ones fortunes change
(either for better or worse) after retirement?

> > B- Keeping the same current SS system, the FICA will provide the
retired
> > with benefits which are ever lower relative to wages.
>
>
> "Same current" means, I presume, same rates, caps, and benefit formulas.
> But guess what: we've got a democracy going here. We can change those
> things if "we" want to.

As "we" have changed SS in the past. Ever higher FICA, ever lower benefits
relative to working income, and an ever higher age to collect.


>...."We" may not be able to convince you, personally,
> but them's the breaks, in a democracy.

Yes. And if you want more of the same, then reject Bush's changes. And
that does seem to be the "peoples choice".

>
> > > The only politicians who want to restrict your medical options are the
> > > Bible-thumpers who value embryos more than human beings.
> >
> > Unfortunately they seem to be a majority.
>
>
> They are only a majority (temporarily) because they have conned people
like
> you into an alliance with people much, much dumber than yourself.

???? They haven't conned me into opposing stem cells research. Or even into
opposing medical marijuana.

>....The
> people I'm talking about are those "family values Christians" who show
their
> contempt for Hollywood sleaze by voting for the party which promises
bigger
> tax cuts to Paris Hilton. They will never wake up. You, I still have
hope
> for.

??? I should favor higher taxes on everyone in the hope that Paris Hilton's
lawyers won't find a loophole?

> > Again, the details. Hillary wanted patients to have ONLY the medical
care
> > that the government provides. To avoid a 2 tier treatment system where
> the
> > rich get the best and the poor get the leftovers.
>
>
> Details are negotiable, Jim. But if you see it as a question of dogma
> ("libruls are eeevil" or something) then we can never get to the
> negotiations, can we?
>
> --TP
>
I could support a "universal" (err, restrict that the earth, or even just
the USA ;-) health care IF I was the one who decided on the details.



,,,,,,,
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(_)
jim blair (jeblair@xxxxxxxx) Madison Wisconsin USA.
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