30-40 years ago, SS revenue being sunk into treasuries wasn't the worst thing. Yields weren't as good as say the S&P, but they beat inflation and were broadly considered safe investments with low to moderate, but reliable, ROI.

This is not the case in 2021.

My baseline thinking is there is no political will or ability to eliminate SS as a concept. So those who wish to eliminate it outright I think are SOL. Even going so far as to allow individuals to opt-out is a nonstarter for most, and that point of view isn't without merit when viewing things collectively (a word that no doubt induces groans and consternation for some, but bear with me). 

So if we start out with the notion that eliminating or allowing an opt-out to SS is simply infeasible in 2021, what might reform look like? 

To appeal to those most reflexively opposed to SS reform, let's look at how every DemSoc's favorite country manages its sovereign wealth fund (which is oil money, but let's not tweak the woke socialist's nose too hard at that..... maybe a little): https://www.forbes.com/sites/palashghosh/2021/04/07/norways-sovereign-wealth-fund-makes-first-investment-in-renewable-energy-infrastructure/

So for decades Norway's sovereign wealth fund, which helps secure its social safety net and its citizens security for likely generations, has bet on itself by investing the money in the markets.

And it's now starting to bet that money on renewables.

So here's my proposal to nobody except a bunch of partisan hacks on an NFL team's message board: why not allow SS funds to be part financial security and part social experiment by continuing to collect these funds as-is but allowing individuals to select from a menu of approved options how that money is invested? To bet on ourselves as Americans, but in the American way - by individually deciding how those funds are used?

Green energy types can elect to invest their funds in renewables. Financial types might just say invest in S&P indexed funds. Old-school Dems who think these funds should only be in guaranteed return vehicles can buy bonds. 

Where it gets sticky is how do earnings get distributed. I would say it all stays collective. Presumably SS would be more solvent with less cash, and payouts for all could be risen accordingly. And I'm ok with that. Others might argue if they bet correctly they ought to benefit more, but I'd argue the whole purpose of social security is to provide some baseline assistance to people unable to work (be it age, disability, whatever.)

And if anybody is curious, yes I am already daydrinking. It's Saturday. 

Time's yours.

5 minutes ago, JohnSnowsHair said:

So here's my proposal to nobody except a bunch of partisan hacks on an NFL team's message board: why not allow SS funds to be part financial security and part social experiment by continuing to collect these funds as-is but allowing individuals to select from a menu of approved options how that money is invested? To bet on ourselves as Americans, but in the American way - by individually deciding how those funds are used?

That's exactly what it looks like in Sweden.  Each individual is free to invest a part of their state run pension within approved options.

That setup is about 25 years old now.

Opt outs are not a nonstarter

I would've gladly managed 12.4% of my earnings in my own retirement fund over the last 20 years.

22 hours ago, JohnSnowsHair said:

30-40 years ago, SS revenue being sunk into treasuries wasn't the worst thing. Yields weren't as good as say the S&P, but they beat inflation and were broadly considered safe investments with low to moderate, but reliable, ROI.

This is not the case in 2021.

My baseline thinking is there is no political will or ability to eliminate SS as a concept. So those who wish to eliminate it outright I think are SOL. Even going so far as to allow individuals to opt-out is a nonstarter for most, and that point of view isn't without merit when viewing things collectively (a word that no doubt induces groans and consternation for some, but bear with me). 

So if we start out with the notion that eliminating or allowing an opt-out to SS is simply infeasible in 2021, what might reform look like? 

To appeal to those most reflexively opposed to SS reform, let's look at how every DemSoc's favorite country manages its sovereign wealth fund (which is oil money, but let's not tweak the woke socialist's nose too hard at that..... maybe a little): https://www.forbes.com/sites/palashghosh/2021/04/07/norways-sovereign-wealth-fund-makes-first-investment-in-renewable-energy-infrastructure/

So for decades Norway's sovereign wealth fund, which helps secure its social safety net and its citizens security for likely generations, has bet on itself by investing the money in the markets.

And it's now starting to bet that money on renewables.

So here's my proposal to nobody except a bunch of partisan hacks on an NFL team's message board: why not allow SS funds to be part financial security and part social experiment by continuing to collect these funds as-is but allowing individuals to select from a menu of approved options how that money is invested? To bet on ourselves as Americans, but in the American way - by individually deciding how those funds are used?

Green energy types can elect to invest their funds in renewables. Financial types might just say invest in S&P indexed funds. Old-school Dems who think these funds should only be in guaranteed return vehicles can buy bonds. 

Where it gets sticky is how do earnings get distributed. I would say it all stays collective. Presumably SS would be more solvent with less cash, and payouts for all could be risen accordingly. And I'm ok with that. Others might argue if they bet correctly they ought to benefit more, but I'd argue the whole purpose of social security is to provide some baseline assistance to people unable to work (be it age, disability, whatever.)

And if anybody is curious, yes I am already daydrinking. It's Saturday. 

Time's yours.

All of the unfunded liabilities for all entitlements are going to be monetized. That's it. That's the plan. That's what will happen. Zero chance of any "reform" much less an ability to allow individuals to have any sort of control over their retirement. Instead of day dreaming about things with no chance of happening, I'd suggest thinking about what that will mean and what you should do to prepare for it.

One can prepare for status quo while resisting fatalism and advocating for change.

Hell even TJ thinks "opt outs are not a non-starter". Politically I believe it is; it's DOA. But there should be conversation about ss reform.

4 hours ago, JohnSnowsHair said:

One can prepare for status quo while resisting fatalism and advocating for change.

Hell even TJ thinks "opt outs are not a non-starter". Politically I believe it is; it's DOA. But there should be conversation about ss reform.

It's too far gone. You can't rug pull SS from boomers right as they retire -- they're the biggest, most reliable voting block in the country.

The problem here is the math doesn't work. There is no "reform" that will actually work without massively slashing benefits. If we wanted to fix this issue it needed to happen decades ago. Instead we doubled down with the Great Society.

7 hours ago, JohnSnowsHair said:

One can prepare for status quo while resisting fatalism and advocating for change.

Hell even TJ thinks "opt outs are not a non-starter". Politically I believe it is; it's DOA. But there should be conversation about ss reform.

Deck chairs on the titanic

it will be monetized as tew says. That mich is obvious. And history shows how that ends up

3 hours ago, TEW said:

Instead we doubled down with the Great Society.

 

We certainly did, but the real problem, or at least a major part of it, was that we did this just as we began shipping massive amounts of jobs overseas and the military-industrial complex was ballooning into 10x the behemoth even Eisenhower had imagined. If we had maintained a modicum of native industry and not become so content squandering taxpayer money on cold-war adventures, we might at least be in a much more stable position than we are today. Water under the bridge, though, I know...

Nothing could have stopped off shoring. Technology changed that forever. 
 

the military had nothing to do with the SS ponzi scheme

1 hour ago, EaglesRocker97 said:

 

We certainly did, but the real problem, or at least a major part of it, was that we did this just as we began shipping massive amounts of jobs overseas and the military-industrial complex was ballooning into 10x the behemoth even Eisenhower had imagined. If we had maintained a modicum of native industry and not become so content squandering taxpayer money on cold-war adventures, we might at least be in a much more stable position than we are today. Water under the bridge, though, I know...

All of these entitlements are a Ponzi scheme in the literal sense. It wasn't shipping jobs overseas. If it was anything besides pure stupidity, it was that our birth rates plummeted. The scheme can go on as long as you can keep bringing in more contributors.

As far as the MIC, we could have literally zero defense spending and it wouldn't have mattered. It's so much bigger than shaving off a few billion here and there. We are talking $100 Trillion in unfunded liabilities.

52 minutes ago, ToastJenkins said:

Nothing could have stopped off shoring. Technology changed that forever. 
 

the military had nothing to do with the SS ponzi scheme

I mean, you can stop off shoring of jobs. Or, at least a lot of them. But then you get into protectionism and things like tariffs. Probably a good idea in some fields, like the manufacturing of pharmaceuticals or other areas that are vital for national security.

1 hour ago, TEW said:

All of these entitlements are a Ponzi scheme in the literal sense. It wasn't shipping jobs overseas. If it was anything besides pure stupidity, it was that our birth rates plummeted. The scheme can go on as long as you can keep bringing in more contributors.

As far as the MIC, we could have literally zero defense spending and it wouldn't have mattered. It's so much bigger than shaving off a few billion here and there. We are talking $100 Trillion in unfunded liabilities.

 

I don't know, $700+ billion seems like a lot more than "just a few billion." In general, I was getting at the combination of a reduced tax base and a mushrooming defense budget. With jobs going overseas the middle class getting squeezed, there's a lot less federal revenue, combined with spending 1/3 of the federal budget on "defense," it's debilitating. I'm not saying that that's all of it, but it's certainly a complicating factor. Good point about lagging birth rates, though.

On 8/14/2021 at 2:07 PM, JohnSnowsHair said:

30-40 years ago, SS revenue being sunk into treasuries wasn't the worst thing. Yields weren't as good as say the S&P, but they beat inflation and were broadly considered safe investments with low to moderate, but reliable, ROI.

This is not the case in 2021.

My baseline thinking is there is no political will or ability to eliminate SS as a concept. So those who wish to eliminate it outright I think are SOL. Even going so far as to allow individuals to opt-out is a nonstarter for most, and that point of view isn't without merit when viewing things collectively (a word that no doubt induces groans and consternation for some, but bear with me). 

So if we start out with the notion that eliminating or allowing an opt-out to SS is simply infeasible in 2021, what might reform look like? 

To appeal to those most reflexively opposed to SS reform, let's look at how every DemSoc's favorite country manages its sovereign wealth fund (which is oil money, but let's not tweak the woke socialist's nose too hard at that..... maybe a little): https://www.forbes.com/sites/palashghosh/2021/04/07/norways-sovereign-wealth-fund-makes-first-investment-in-renewable-energy-infrastructure/

So for decades Norway's sovereign wealth fund, which helps secure its social safety net and its citizens security for likely generations, has bet on itself by investing the money in the markets.

And it's now starting to bet that money on renewables.

So here's my proposal to nobody except a bunch of partisan hacks on an NFL team's message board: why not allow SS funds to be part financial security and part social experiment by continuing to collect these funds as-is but allowing individuals to select from a menu of approved options how that money is invested? To bet on ourselves as Americans, but in the American way - by individually deciding how those funds are used?

Green energy types can elect to invest their funds in renewables. Financial types might just say invest in S&P indexed funds. Old-school Dems who think these funds should only be in guaranteed return vehicles can buy bonds. 

Where it gets sticky is how do earnings get distributed. I would say it all stays collective. Presumably SS would be more solvent with less cash, and payouts for all could be risen accordingly. And I'm ok with that. Others might argue if they bet correctly they ought to benefit more, but I'd argue the whole purpose of social security is to provide some baseline assistance to people unable to work (be it age, disability, whatever.)

And if anybody is curious, yes I am already daydrinking. It's Saturday. 

Time's yours.

What are your thoughts on Paul Ryan's old reform ideas of moving retirement up to 67 or 70, only for future generations not yet born or working yet, due to the increase in lifespan over the decades?

6 hours ago, xzmattzx said:

What are your thoughts on Paul Ryan's old reform ideas of moving retirement up to 67 or 70, only for future generations not yet born or working yet, due to the increase in lifespan over the decades?

I'm fine with that. I'd even be fine with it being means tested, though it would probably screw me. 

Absent of REAL reform, I think the only thing you can do is raise the retirement age for younger people.  Pick some cutoff age, like people currently 40 and under, and raise the retirement age to say 75 or something.

 

 

1 hour ago, JohnSnowsHair said:

I'm fine with that. I'd even be fine with it being means tested, though it would probably screw me. 

How faux noble of you…

12 minutes ago, ToastJenkins said:

How faux noble of you…

boomers screwed us, and assuming I don't get incapacitated the SS is going to be beer money. I'd rather have it than not, but long-term it's almost certainly better for solvency to means test. 

if it means my kids would have the option to plug their SS into the S&P rather than bonds that lag inflation, sure I'll make that sacrifice. if you want to consider that "noble", go for it. I consider trying to make sure we leave things better for our kids than we got them as the bare minimum. (again, too bad the boomers decided "screw the kids, we're going to get ours")

What are we really talking about here? Social Security produces little revenue. That's beyond the point of the system. Social Security isn't like an IRA. The money deducted from your paycheck isn't locked away in some account somewhere to collect from later. Workers now pay for the old age collecting benefits now. Something like 90% of payroll taxes are paid out in SS benefits right away. What about the rest? Besides putting in a lock box or stuffing in under a mattress to collect no interest... I guess it simply needs to keep up with inflation? So do whatever with it. Invest in renewables? Fine. Oil? Fine. Index funds? Whatever. IMO, we should diversify the fund... But I really don't care. A lot of folks don't know how to manage their own money, that's why we have Social Security in the first place.

If you want the ability to choose how your retirement dollars are invested, start an IRA.

21 minutes ago, toolg said:

What are we really talking about here? Social Security produces little revenue. That's beyond the point of the system. Social Security isn't like an IRA. The money deducted from your paycheck isn't locked away in some account somewhere to collect from later. Workers now pay for the old age collecting benefits now. Something like 90% of payroll taxes are paid out in SS benefits right away. What about the rest? Besides putting in a lock box or stuffing in under a mattress to collect no interest... I guess it simply needs to keep up with inflation? So do whatever with it. Invest in renewables? Fine. Oil? Fine. Index funds? Whatever. IMO, we should diversify the fund... But I really don't care. A lot of folks don't know how to manage their own money, that's why we have Social Security in the first place.

If you want the ability to choose how your retirement dollars are invested, start an IRA.

My argument in general is to treat the money we're requiring people to pay in to fund SS to be treated closer to a sovereign wealth fund than just something barely keeping with inflation (if that). 

2 hours ago, JohnSnowsHair said:

boomers screwed us, and assuming I don't get incapacitated the SS is going to be beer money. I'd rather have it than not, but long-term it's almost certainly better for solvency to means test. 

if it means my kids would have the option to plug their SS into the S&P rather than bonds that lag inflation, sure I'll make that sacrifice. if you want to consider that "noble", go for it. I consider trying to make sure we leave things better for our kids than we got them as the bare minimum. (again, too bad the boomers decided "screw the kids, we're going to get ours")

nowhere near a big enough to change to make it solvent. nor is nudging the age up slightly. has to be wholesale change

and yes the boomers, america's worst generation, are the primary liability behind it. 

 

2 things:

1. There is no money to invest anywhere, as @toolg pointed out. The money we are paying today is going straight out the door to current recipients...because that is how a Ponzi scheme works. So all you could really do is let people "phantom invest" in the S&P 500 and just change the future liability.

2. Allowing people to invest or "phantom invest" their social security payments into stocks, green energy, etc. is just about the stupidest thing we could do (other than passing a massive Ponzi scheme in the 1st place). Imagine someone who was retiring and looking to start collecting in March 2009, right as the market bottomed. Does anyone REALLY think there would be political will to make that person feel the consequences of his decision? That he'd be forced to take payments 50% lower than others because the market sold off? Have you paid any attention to the function of government since 1933 -- morons can never be allowed to feel negative consequences. On the next correction, Congress will simply add more deficit spending to make those people "whole" since it is so unfair. 

There is no will to do what must be done. But putting capital at risk is insane when we all know the government will simply print money to indemnify people from losses. 

Pick a date to end it altogether. Those that wouldn't get SS benefits after the cutoff date should get the money back they put in. If you didn't put anything in then you get nothing.

3 minutes ago, mayanh8 said:

Pick a date to end it altogether. Those that wouldn't get SS benefits after the cutoff date should get the money back they put in. If you didn't put anything in then you get nothing.

Can't be having any socialist type programs being had in this country 

Just now, Bwestbrook36 said:

Can't be having any socialist type programs being had in this country 

It's not even about that. I am all for social programs that make sense and can be paid for in a reasonable way.

1 minute ago, mayanh8 said:

It's not even about that. I am all for social programs that make sense and can be paid for in a reasonable way.

I know I was joking around.