Proposed massive cuts to Social Security

[Bengalzona]

http://finance.yahoo.com/news/gop-introduces-plan-to-massively-cut-social-security-222200857.html

Quote:The bill introduced by Johnson, who is also the chair of the Social Security subcommittee, slashes benefits, adds means testing, and would raise the retirement age from 67 to 69.

For most workers, the bill would cut Social Security benefits substantially. As Michael Linden, associate director for tax and budget policy at Center for American Progress, pointed out on Twitter, a letter from Social Security’s Office of the Actuary calculated workers making around $50,000 would see checks shrink by between 11% and 35%.

Nearly every income bracket would see a reduction, save for the very bottom. People making around $12,280 in 2016 who have worked for 30 years would see an increase of around 20%. But young people making the same amount would be hit hard by the changes. If they had 14 years of work experience by 2016, they would see their benefits cut in half.

The plan would also cut entirely cost of living adjustments (COLA) for retirees earning above $85,000.

If nothing happens, Social Security will start to lose its ability to pay benefits in full in the 2030s. However, Josh Marshall of Talking Points Memo notes that by 2090 it will still be paying at 74%.

Democrats, expectedly, are not pleased with Johnson’s plan, preferring strategies like increasing taxes above the Social Security cap—billionaires pay the same amount as someone making less than $118,000—or raising the Social Security tax itself. There has, however, been a bipartisan effort for a payroll tax to help keep Social Security funded. For now, Congress will deliberate on Johnson’s proposal in 2017.

Thoughts?

[NATI BENGALS]

Gotta pay for Trumps tax cuts for the rich and big business somehow. Maybe the elderly retiree bums can get jobs building and maintaing the wall.

[*bfine32*]

(12-10-2016, 12:51 AM)Bengalzona Wrote: http://finance.yahoo.com/news/gop-introduces-plan-to-massively-cut-social-security-222200857.html


Thoughts?

Nothing wrong with relooking Social Security as long as cuts are announced (benefits and taxes) early enough for the worker to establish a private plan. We should not cut those currently receiving benefits or have 30 years paid in.

[*bfine32*]

(12-10-2016, 02:29 AM)NATI BENGALS Wrote: Gotta pay for Trumps tax cuts for the rich and big business somehow. Maybe the elderly retiree bums can get jobs building and maintaing the wall.

Yet the proposal benefits the poor

[NATI BENGALS]

(12-10-2016, 02:38 AM)bfine32 Wrote: Yet the proposal benefits the poor

Jamming it up the ass of the middle class. Its the republican way.

[JustWinBaby]

(12-10-2016, 02:37 AM)bfine32 Wrote: Nothing wrong with relooking Social Security as long as cuts are announced (benefits and taxes) early enough for the worker to establish a private plan. We should not cut those currently receiving benefits or have 30 years paid in.

Excellent.

100% on the money.  The system is unsustainable, but people have to have sufficient notice for planning.

This has nothing to do with Trump.  The SS disaster has been long known and yet punted since Bush The First.

[JustWinBaby]

(12-10-2016, 05:03 AM)NATI BENGALS Wrote: Jamming it up the ass of the middle class. Its the republican way.

Actually, more Dems.  If there actually is a distinction. 

But, generally speaking, if you're not on welfare or rich, then Democratic databases most likely classify you as white privileged.

[xxlt]

(12-10-2016, 12:51 AM)Bengalzona Wrote: http://finance.yahoo.com/news/gop-introduces-plan-to-massively-cut-social-security-222200857.html


Thoughts?

Yeah, lift the wage cap so EVERYONE pays in at the same rate on EVERY dollar earned. Problem solved. 

[*bfine32*]

(12-10-2016, 05:06 AM)JustWinBaby Wrote: Excellent.

100% on the money.  The system is unsustainable, but people have to have sufficient notice for planning.

This has nothing to do with Trump.  The SS disaster has been long known and yet punted since Bush The First.

I'm not even sure if folks understand how SS works. It is figured from your top 30 years of income. The notion being that you paid more into the system. So any cut in the program is going to affect the richer more so than the poorer; as they have already given, now they are getting a deduction in their investment.

This is why I stated I have no problem with scraping it today, but do not take from those that have already paid in.

Some folks just love to complain and often do not know what they are complaining about.

[Devils Advocate]

SS wasn't meant to be a tax. Get rid of it altogether; let me have my money back and I'll worry about my 'social security'.

[*bfine32*]

We are living too long.

[Bengalzona]

(12-10-2016, 02:09 PM)bfine32 Wrote: We are living too long.

[samhain]

(12-10-2016, 12:40 PM)bfine32 Wrote: I'm not even sure if folks understand how SS works. It is figured from your top 30 years of income. The notion being that you paid more into the system. So any cut in the program is going to affect the richer more so than the poorer; as they have already given, now they are getting a deduction in their investment.

This is why I stated I have no problem with scraping it today, but do not take from those that have already paid in.

Some folks just love to complain and often do not know what they are complaining about.

What exactly do you mean by "those who have already paid in"?  Do you mean anyone working at all or anyone that's made X amount of years of payments?  Not arguing, just don't get your meaning.  

I suppose I don't mind some form of reworking of the program.  It's necessary.  It just sticks in my craw a bit to think that I may not get what I've paid in over the last quarter century or so.  Those are deductions I could have been socking away into another means of retirement savings or my house, my son's education, etc.

I realize that money is needed to keep the program salient for the folks currently dependent on it, but if we as a nation are going to decide to tell retirees: "Up yours, you're on your own from here on out!", then I want my money back.  That's stealing IMO.  If all goes according to plan, I won't need to depend on that money, but it's money I worked for all the same.  

[JustWinBaby]

(12-10-2016, 12:40 PM)bfine32 Wrote: I'm not even sure if folks understand how SS works. It is figured from your top 30 years of income. The notion being that you paid more into the system. So any cut in the program is going to affect the richer more so than the poorer; as they have already given, now they are getting a deduction in their investment.

Well, it's social insurance....which means you pay a premium for a policy.  If you end-up well off, then you wouldn't/shouldn't have a "claim".  I'm not sure of the formulas, but the benefit falls off a cliff after a minimal/nominal amount (dropping quickly to something like 32%, and then 15%) - a pretty lousy savings program for someone who might be middle/upper middle class. 

When the program was designed, those people may have had other nest eggs beside their house.  No longer true.  In that respect, benefits in the middle need to be expanded, not cut (different from age increases, which makes sense).  You can only get that by increasing the cap and cutting benefits for the wealthier.

I'd maybe like to see the individual cap remain, but not on the employer side (since we don't get that money, anyway).

[JustWinBaby]

I should also add that, I suspect, a lot of people with other significant savings are already voluntarily taking cuts by opting for earlier distributions.

But at the end of the day, it's all just a shell game moving taxes around between distributions and collections. What difference is there, really, if my 6.2% SS contribution is capped, but then my marginal rates go up 5-10%? I'm still paying the same in taxes, it's just going to different buckets. And SS is supposed to be a separate bucket and untouchable, but that's not really true.

[*bfine32*]

(12-10-2016, 08:32 PM)samhain Wrote: What exactly do you mean by "those who have already paid in"?  

A "pro-rated" amount. For instance it is top 30 years. If you've paid in 25 years calculate the remaining 5 as 0 and that is your entitlement. Paid in 20 then 10 years as 0, ect... all the way down to someone that has only paid in 1 year and has 29 as 0. 

[JustWinBaby]

(12-10-2016, 10:46 PM)bfine32 Wrote: A "pro-rated" amount. For instance it is top 30 years. If you've paid in 25 years calculate the remaining 5 as 0 and that is your entitlement. Paid in 20 then 10 years as 0, ect... all the way down to someone that has only paid in 1 year and has 29 as 0. 

Generally correct, but I think it's actually the top 35 years with a minimum of 10 qualifying years.

I believe there's also a large number of public unions that have a pension and no SS...although there's a variety of double-dipping.

And funding of public pensions is not an entirely separate issue. I think there are a lot of ethical and moral questions on how much future generations should be financially responsible for unsustainable benefit promises or bad calculations they had no say in.

[*bfine32*]

(12-10-2016, 10:50 PM)JustWinBaby Wrote: Generally correct, but I think it's actually the top 35 years with a minimum of 10 qualifying years.

I believe there's also a large number of public unions that have a pension and no SS...although there's a variety of double-dipping.

And funding of public pensions is not an entirely separate issue.  I think there are a lot of ethical and moral questions on how much future generations should be financially responsible for unsustainable benefit promises or bad calculations they had no say in.

Well given that I'm not going to write the final plan without compensation; just explaining how folks that have paid in could get some back.

[samhain]

(12-10-2016, 10:46 PM)bfine32 Wrote: A "pro-rated" amount. For instance it is top 30 years. If you've paid in 25 years calculate the remaining 5 as 0 and that is your entitlement. Paid in 20 then 10 years as 0, ect... all the way down to someone that has only paid in 1 year and has 29 as 0. 

Gotcha.  Thanks for clarifying.

[fredtoast]

(12-10-2016, 12:47 PM)Devils Advocate Wrote: SS wasn't meant to be a tax. Get rid of it altogether; let me have my money back and I'll worry about my 'social security'.

Yet if you were to become disabled tommorrow you would not have any income to live on and would be dependent on the state to take care of you.