http://www.populist.com/06.16.kalet.html
GRASSROOTS/Hank Kalet
Securing Social Security
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President George W. Bush is once again targeting Social Security. But rather than the full-frontal assault he waged against the retirement system shortly after being sworn in for his second term in 2005, he appears to be planning an end run.
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Bush’s way of dealing with Social Security? Privatization. The Bush plan would allow workers to shift a significant portion of their annual Social Security contributions into private accounts that could be used to invest in mutual funds. The president claims the accounts would give workers more control over their retirement money and a better return on their investments, but his plan really would do nothing more than phase out the current system and leave us all at the mercy of an increasingly volatile market.
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Herb, Herb, Herb, what are we going to have to do to convince you that the “great program” of FDR is nothing more than an inter-generation Ponzi scheme that steals from everyone while transferring funds from poor minority men to rich white women?
As you know I have no use for either big government socialist party.
But you can’t just chastise Bush and Kean Jr without mentioning that the other side of the aisle won’t do any better. Menendez refuses to even admit there’s a problem. Any Presidential candidate from either side of the aisle worth their salt will promise to “save” it without any details.
But not to worry, nothing either side of the aisle is going to do will prevent the eventual crack up of Social Security Insurance, Medicare, and the vaunted prescription benefit with the doughnut hole.
Ask any young person about Social Security and they will tell you that they aren’t counting on it. Good! Because it has always been a demographic time bomb. It’s just a socialist welfare program that will evaporate of its own defects as they tinker increasing the age, raising the taxability (Remember the promises that it would never be taxed!), and lowering the “benefit”. Eventually it will just be welfare for old folks.
It’s not insurance. As is often said, if an insurance company executive did what the government did, then all of the executives would be in jail.
Assuming that the various socialists can’t possibly let people save for their own retirement, then we should have true privatization like Chile did in the 70’s.
Recognize that for the poor, their “social security insurance” forced savings might be their biggest asset. That’s why this fraud is so wrong. So fraudulent. So un-american. They are forced to kick in money that they really need, only to have it stolen from them.
Note, I want Chilean privatization, not the Republican ersatz privatization that leaves the government with the keys to the “lock box” (You remember that fiction!).
The interesting example of Chile is that it was done with an illiterate uneducated population with similar deficits and unfunding. You would think, with our First World government educated literate population, we could do as well. I, on the other hand, think we will allow the politicians and the press to fool us into thinking that one side or the other of the aisle cares enough to solve the problem.
Like most children’s tops, the system will eventually go to a lower energy state. That is flat on the table. Woe to any who have to depend on SSI. It’s a government fraud!
Sorry, but I think you are engaging in “wishful thinking” at best, or blatant political bias at worst. Either way, social security insurance is a Katrina style disaster in the financial dimension. The only question is how much death, physical / emotional pain, and civil unrest that we will have to endure.
It’s a national disgrace.
Reinke Faces Life 
The only thing that makes SSI sort of a Ponzi scheme is that the fund managers, the government, steal the money for other things and replace that money with IOUs that are debt as opposed to direct expenditures. If they didn’t do that, SSI, being a generational transfer of wealth, would be flush with real money, with value growing just fine on it’s own even at this time. The fund should grow flush when there are more younger people in the workforce, and shrink when when there are more elderly and infirmed and orphanned. It is a welfare program, no doubt. But there’s a time and a place for everything, including capitalism and socialism.
If it were in a “lock-box,” the popular expression, even just now, SSI would, again, be fine. In theory, you only need a 3-6 workers per recipient, depending on the temporal demographics. And, because it is a generational program, when times are better the fund will grow enough to cover when times are worse, as it will be when the Boomers retire. But remember, as they get old, they will die, just like everybody does eventually. What the population patterns will be when those days come is as yet unknown – but there are things we could be doing now to make that more certain and positive.
First thing – legalize the “illegals” that want to stay and bring in more realistic numbers from realistic places “legally.” They’ll make more money than they are now, have more kids, and help to support the people who built this great nation for them instead of just helping cheap contractors and Big Agro. Secondly – raise the payroll tax cap. The system can be rationally adjusted to it. If you lifted the cap completely, you could raise the benefits for those who stand more to “lose.” After all, some people pay more into SSI than they get back, and some people get more than they paid in. It is a social program – not an investment scheme. That’s why it is not a Ponzi scheme insofar as it’s intended. It only becomes a scam when the managers, the government, steal from it.
JMJ
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