Do you agree with cutting social security or medicare?

[Cantih]

Fair enough

[Kuya]

First, to this... the wealthiest 10% pay 70% of America's taxes; this is a higher ratio than the wealthiest 10% pay in any other nation on earth. The wealthiest 1% pay about 50% of America's taxes. This, too, is a higher ratio than the wealthiest 1% in any other nation pay on their taxes. The bottom 49% didn't end up owing *ANYTHING* in income tax, and a sizable chunk received back *MORE* than they paid. History has shown that trying to squeeze a higher percentage out of the rich just leads to creativity or hording. The former leads to them taking more risks to avoid paying taxes, and the expense of the lawyers to get them out of those risky binds is no where near the amount they'd end up paying. History has also shown that reasonable tax rates (read: close to what the mainstream pay in pure % terms), tends to get paid, particularly as the risk of cheating gets less worth the potential benefits.



More on topic, yes, the FICA programs should get cut. Social Security isn't a financial sinkhole (yet), but it is on its way, and will be entirely unsustainable in the next 10 years as more and more baby-boomers start collecting, and don't stop collecting for 10-20 years. Social Security either needs privatized (probably not happening until it's at a true deficit), the rates increased (which will hurt the poor more than it helps those who need SS), or we need a massive population boom. Canceling it is altogether is another option, but really, the first two are the only two that are plausible. As the Greatest Generation dies off, privatization is more likely. Medicare I'd have almost no problem axing altogether. I'd love to see Medicaid reduced to state-funded only.

With the topic answered, make no mistake: the military could be scaled way back in budget, too. The main problem is duplication of function in the branches. Streamline and more specifically identify each branch's role, remove the overlap, and then budget accordingly. It really is mostly the redundancy that destroys the budget, particularly when you have multiple branches funding research on the same problem. I'm a firm believer that the military must continue to make progress, as stagnation is eventual death, but I also think that the military would make better progress, for less money, if about half the politics were removed, and more genuine military discipline reigned at the top.


The main problem that these programs face, of course, is that they are the two largest lobbying groups in the country. That is also, of course, why they are each over-funded and under-regulated. They are the hot buttons no one wants to touch, except to expand. Both have also grown to the point where they need trimmed, at least, to healthier, more manageable sizes.

Since i don't have enough knowledge of the subject, i'll have to have you address these quotes that seem to refute what you say.

Link

These quotes will address the issue that you seem to be overinflating the preassure on SS which can easily be solved through other means and that privatizing it would lead to other unaccounted costs:

Those who want to overhaul Social Security make their case with the following numbers: in 1960 there were more than five workers for each beneficiary; today there are 3.3 workers; by 2030 there will be only two workers for each beneficiary. At present the fund is running an annual surplus of more than $80 billion, approximately 20 percent as much as its current expenditures. This surplus will generate interest revenue to help support the system as the ratio of workers to beneficiaries continues to fall in the next century. Also, the fact that workers are becoming more productive year by year means that it will take fewer workers to support each retiree. The United States had 10.5 farm workers for every hundred people in 1929; it has fewer than 1.1 farm workers for every hundred people today. Yet the population is well fed, and we even export food. Rising farm productivity made this possible. Similarly, increases in worker productivity (which have been and should be reflected in higher incomes), however small compared with those of the past, will allow each retiree to be supported by an ever smaller number of workers.

In fact the demographics of the Baby Boom have very little to do with the long-range problems of Social Security. The main reason the fund will run into deficits in future years is that people are living longer. If people continue to retire at the same age but live longer, then a larger percentage of their lives will be spent in retirement. If people want to spend a larger portion of their lives in retirement, either they will have to accept lower incomes (reduced benefits) in their retirement years relative to those of their working years, or they will have to increase the portion of their incomes (higher taxes) that they put aside during their working years for retirement.

This is the main long-range problem facing Social Security. Current projections show that the annual deficit will be 5.71 percent of taxable payroll in 2070, long after the Baby Boom will have passed into history. But the annual deficit is expected to be only 4.44 percent of taxable payroll in 2035, when the worst crunch from retired Baby Boomers will be felt.

Examining just the change in the ratio of beneficiaries to workers overstates the burden that workers will face in the future. To assess the burden accurately it is necessary to examine the total number of dependents -- beneficiaries and children -- each worker will have to support. It is projected that this ratio will rise from 0.708 per worker at present to 0.795 in 2035. But even this number is well below the ratio of 0.946 that prevailed in 1965. And the fund's trustees project a lower birth rate, meaning that the increased costs of providing for a larger retired population will be largely offset by the reduction of expenses associated with caring for children.

By itself, privatizing Social Security would not create a penny of additional savings. All the privatization plans call for the government to continue to pay Social Security benefits to current recipients and those about to retire; therefore spending would be exactly the same after privatization as it was before privatization. Yet the government would no longer be collecting Social Security taxes. Each dollar an individual put into a private retirement account rather than paying it to the government in Social Security taxes would still be a dollar the government must borrow. Individuals would be saving more, but the government would have reduced its saving (increased its borrowing) by exactly the same amount. Most of the privatization schemes being put forward call for additional taxes and additional borrowing to finance a transition while benefits were being paid out under the old system. Any additions to national savings attributable to these plans would stem entirely from the tax increase. This tax increase would have the identical effect on national savings if it were not linked to privatizing Social Security. In other words, raising taxes is one way to increase national savings, and if we are willing to raise taxes, we need not privatize Social Security.

The fact that individuals might put their savings in the stock market or in other private assets, whereas the Social Security Trust Fund buys government bonds, doesn't affect the level of saving at all. If it did, the government could increase the level of saving in the economy by borrowing money and then investing it in the stock market, or by borrowing money and giving it to individuals with the requirement that they invest it in the stock market. If either step could increase the level of saving in the economy, the government should take it independent of any changes in the Social Security system.

In fact, all else being equal, if individuals invested the money they would otherwise pay out in Social Security taxes, less saving would result, because a large portion of this money would be siphoned off by the financial industry. Currently stock brokers, insurance companies, and other financial institutions charge their customers an average of more than one percent a year on the value of the money they hold. Thus if $1,000 is invested through a brokerage firm for forty years, the investor will have been charged in excess of $400 in fees on the original investment, plus an additional one percent a year on all gains. These fees are a big cost from the standpoint of the individual investor, and a complete waste from the standpoint of the economy as a whole. Meanwhile, the operating expenses of the Social Security system are less than $8.00 for every $1,000 paid out to beneficiaries.

It is easy to see why costs in the private financial sector are so much higher. The private sector pays hundreds of thousands of insurance agents and brokers to solicit business. It also incurs enormous costs in television, radio, newspaper, and magazine advertising. In addition, many executives and brokers in the financial industry receive huge salaries. Million-dollar salaries are not uncommon, and some executives earn salaries in the tens of millions. Privatization would add these expenses, which are currently absent from the Social Security system

Can you address these counter-arguments?

[Marootsoobutsu]

Might you cite some sources on the US's tax rate both in general and on the wealthiest? Also, could you clarify where you got the idea that the US military's purpose, when considering its size, is to protect US allies? That's a new one.

edit: would also like to know from what the US is protecting these allies

As far as where the military's purpose is... arguably, much of that purpose ended with the collapse of the Soviet Union. Certainly, the immediate perceived threat is no longer there. The current military funding is a holdover from the Cold War mentality, though. And whether or not it was our *intention* to overspend to the point that our allies would, in turn, be able to relatively underfund their militaries, that's ultimately what happened.

Conservatives (and, I guess, some liberals?), would probably point to the need of an overinflated military to prevent others from rising as a threat, notably Russia, China, or India (at least, those are the three I hear most frequently, especially China). Alarmists would cite terrorists, though that doesn't take so much an inflated budget as better fucking strategic and tactical application.



Re: Taxes: can't find the total tax burden (state, county, federal, etc...), but http://taxesandgrowth.ncpa.org/news/...eir-fair-share has most of the information ready-at-hand for federal taxes, and they get their information from http://www.cbo.gov/ftpdocs/53xx/doc5...2-TaxRates.htm. These numbers go through 2001; I'm looking for more recent figures, but have read that the trend has accelerated.

http://www.american.com/archive/2007...pays-the-taxes Provides some more breakdowns with (a little) less rhetoric, but puts things in both absolutist and relative perspectives.

http://seattletimes.nwsource.com/htm...notaxes08.html The Seattle Times ran an article about three weeks ago, stating that 47% of households pay no federal income tax.

http://www.factcheck.org/kerrys_tax_...isleading.html talks about a Kerry ad from the 2004 campaign, and compares the relative tax-burden compared to relative income earned.

Also, I think this should be pointed out: those who earn 21.2% of the nation’s income pay 39.4% of all federal income taxes. http://www.outsidethebeltway.com/arc...he_most_taxes/

I'm trying to remember which newspaper or magazine it was where I read America's wealthiest relative payment compared to the rest of the world; my gut would be the WSJ, and I'm sure I read it in the last two weeks, but I can't remember for sure, and my Google skills are failing me on it.

Overall, reading this shows between 65-70% paid for by the top 10% wealthiest, and 33-50% (year dependent; it seems closer to 40% now after the Bush years). The trends from as far back as the 1920s have pretty much born out, though, that reasonable tax rates-- not in the eyes of the poor, but the eyes of the wealthy-- result in more overall income, and (for whatever reason), a higher percentage of taxes paid by the wealthiest.

[#686578]

Numbers don't get crazy until top 1%.

Woah woah woah

[Sepukku]

I believe whole-heartedly that Medicare needs to be reduced/eliminated. The government should not be spending trillions of dollars to extend the lives of retired people (who are therefore not contributing to society compared to their younger, working counterparts) by another 5-10 years, all so the politicians can get more votes because they defended/expanded/etc the program for the old people.

Social Security, no. It should stay.

Medicare in regards to handicapped people, no. It should stay.

Giving every senior citizen health care but not giving the young people, the future of the country, health care never made any sense.

[Marootsoobutsu]

Re: Social Security--

The drop off in payers-to-recipients is indeed part of the problem; it results in either a need for increased rates, or a drop in relative value of dollars received. While the latter isn't necessarily bad, it requires price controlling on a far more pervasive level than it is now. Picture crop subsidies, but on everything we have... this would be incredibly bad for a long-term economy.

While Social Securit is operating at a surplus at the moment, that is in large part because most baby boomers still haven't retired. As they retire-- and, more importantly, live longer-- the amount owed quickly catches up, and eclipses what will be paid in, unless there is an influx in population, or the relative benefits decline in relation to the rest of the economy, or the SS burden on the current workers is increased.

The part about increased productivity, though, is utterly stupid. Yes, productivity has increased, but while that means a lot in absolute terms (raising 14 trillion dollars vs. 1 billion as a nation, depending on how far back one wants to go), but the percentages of the market are ultimately a zero sum game. Individual markets can rise or fall in their relation to each other, but all that ultimately results in is inflation, unless the government severely steps in and implements extreme price controls. And, if they do that, then you tend to get more depressed economies, which brings in a whole bunch of other problems. In short, yes, increased productivity will happen, but it won't help social security as it means prior contributions to the system are worth progressively *less*-- a fact which is incredibly damning as you have an increasingly similar worker-to-beneficiary ratio.


The quoted bit does provide the one real legitimate problem with privatization. Namely, it would require a generation to double-pay, covering retirees as well as themselves. The up side, is it wouldn't genuinely double the amount paid, as an interest-earning retirement plan requires less income to support than does a "we'll have our kids pay for us" plan like the current system. It should also allow the current generation to pay a smaller portion to current-system SS, but there is no denying that the current workers would pay a higher portion than the generation in elementary school now. I think that the benefits are worth that added cost, though, as it would ultimately create a system that should surpass current models in terms of efficiency. The major caveat I would place, would be that the privatized system be inheritable *ONLY* to someone who either jointly filed taxes, or was listed as a dependent for a "significant time" (10 years? 20? 5? I dunno; that detail can be hashed out), and then only accessible under the same circumstances social security is now. As such, the home-maker who's spouse suddenly dies isn't up a creek, and isn't dependent on the government. Moreover, as any dependent (for a significant period) would qualify, it removes that pesky marriage aspect. (note: most GOP plans I have read for privatization suck donkey balls, or they deny the realities of switching the system)

The claim that "if we are willing to raise taxes, we need not privatize" is just plain silly. Mainly, because the increased tax is a temporary sufferance to save a system that will ultimately die if it's not radically altered. You cannot simply continue, indefinitely, to raise taxes. Similarly, if people continue to live longer and longer, the problems of increased productivity become more and more damaging as paid-in value falls farther and farther behind inflation. The system needs altered to something that at least matches (and, ideally, beats by at least 3%), inflation.

As for the specious claim that "that individuals might put their savings in the stock market or in other private assets, whereas the Social Security Trust Fund buys government bonds, doesn't affect the level of saving at all. If it did, the government could increase the level of saving in the economy by borrowing money and then investing it in the stock market, or by borrowing money and giving it to individuals with the requirement that they invest it in the stock market," ignores the fact that, by and large, the government is legally forbidden to do so. It's not *ALLOWED* to do so, so whether it would or wouldn't work is beside the point.

Claims that a large portion of the money would be siphoned off are likewise silly. That problem is easily solved by a no-fee requirement for SS taxed funds; financial institutions would still generally leap at the chance to have that money, as they can generally pull out more than the investor regardless of fees. The danger would be a need for 100% transparency to the populace, with every investor receiving a full disclosure every year, and close scrutiny by the IRS in any firm that received a license as a SS investor. Most of the costs would be reduced or eliminated, and the funds-on-hand to invest themselves would far, far, far outweigh whatever costs were associated with handingly a government-mandated account.

[Olo401]

No, what needs to be cut is the unnecessary and excessive war and empire maintenance budget. Pull out of Afghanistan & Iraq completely, close our military bases in other countries, bring our troops home and reallocate them to border defense, the Coast Guard and the Merchant Marines (to stop piracy and smuggling of weapons). Let fucking China waste its money policing the world we've done enough of that shit over the past 100 years.

HOWEVER..

Social Security does need to be reformed because it has almost the same structure that it did when it was first implemented in the 1930s. As it is currently set up, 6% (?) of your income is put into your social security account with a matching amount from your employer (However once you go over $97k/year in gross income, you stop paying in.) This money is then paid out to those who are retired to keep them out of poverty. Right now we have two large problems. First, the retiring population is much larger than the population paying into the program. Second, the cap where people stop paying into the program is too low - back when the program was first started $97k was filthy fuckin' rich no matter who you are; in 2010 it's comfortably middle-class but by no means rich, and the cost of one major medical incident can wipe you out. In order to correct this temporary (20 years or so) imbalance, the cap will need to be raised or adjusted. There are a few ideas out there along these lines but the best one I've seen was first proposed in 2004-5 by Al Franken:

- On the first $30k of income each year, no payments are made by a person or by their employer into Social Security (This not only helps keep money in the hands of those who don't have much, but also unburdens many employers and small businesses)
- From $30k - $130k/yr, payments are made into SS at the same rate they are now and are matched by the employer.
- From $130k - $1mil/yr no payments are made.
- On any income over $1mil/yr, 6% unmatched would be paid into SS.

[Rhinox]

Surprise none of the usual talking points of the "bottom 49% don't pay income taxes!" or "Poor people don't hire anyone!" has shown up.



Want to pay for Social services and reduce the deficit? I'll tell you how and I'll try to limit it too Bumper sticker terms


Roll back the Reagan tax cuts end tax havens and end the two wars and cut Defense spending dramatically. 52 cents out of every dollar goes into war or what results from the war.

And before anyone thinks the super Rich will leave the country in some sort of mass exodus go watch an episode of the hills.

I'm so edgy. I Believe in the false left-right paradigm

We get it.

[Darus Grey]

The biggest issue with social security is that we keep fucking spending the money.

The entire system as conceived was self-sustaining, except that we'd need to pass a constitutional amendment to protect it, because politicians keep dipping into it(and will as long as they only need majority votes to do so), which not only reduces current funds but significantly reduces FUTURE funds compounded from that interest. Not only that but the funds taking get replaced with debt...so we have to pay back 300billion or whatever to SS paying interest to replace it.

If this wasn't happening then it would be self-sustaining, because a single worker's contribution would cover the entirety of his benefits. The 5:1/2:1/etc issue is a product of the fact that we keep dipping into the honey pot.

[barber2006]

Unless we all of a sudden stumble upon an exportable replacement for oil that will bring in billions (if not trillions) of dollars a year, something will have to be cut.


Bottom line is that we are sitting at debt being what? 91% of current GDP? With 100% looming in the near future. 100% means we can turn into Greece in a split second.


19% of the budget is spent on medicare/medicaid (which will grow in short order)
22% is spent on defense
20% on social security (which will grow in short order)
8% on interest (which will grow in short order.

That's 69% of the budget right there. Either you cut one of those completely or you cut each (other than interest) by 1/3rd. The only other option is to cut 1/4th of the remaining programs like welfare, nasa, etc or start eliminating programs altogether.

And that's just to stem the tide and break even. If we want to start chipping away even more cuts have to be made.

Even if we cut defense in half, one of social security/medicare/welfare will need to be cut in half as well. Do you think that will happen? Nope. Not until we are broke with loans called in. Which we will pay by printing 9 trillion dollars in new money. Which will throw us into a huge inflation and a very destabilized government.

[MF Perm tha Fineass]

We have the worst social problems because we are trying to micro-manage Europe from London. The EU model isn't a bad one for interstate trade, but comparing the US in any way, shape, or form to ONLY France or ONLY England is retarded. There is no nation on Earth that compares to America in terms of population, infrastructure, geography, and wealth. Most of the EU has a state that it is comparable to.

While the Federal government does have very legitimate, necessary roles, its scope of top-to-bottom power has far exceeded the ability of a single central government to organize to effectively meed the very different, very specific needs across the several states. In turn, the states (which have the ability to respond to local population needs), continue to try and force authority and power on a federal system so they don't need to man up and solve their own damned problems.


The last major reason that we have (arguably, depending on your perspective), the worst social welfare programs, is because we basically built up a military strong enough to protect our allies to the point where there own military budget can be a fraction (relatively) to what ours is for their needs. America took on the role of Super Power, and as such eased the military needs of her allies. Our wealthiest pay more, but the needs of our defense are likewise substantially higher.

Sorry dude I don't know what fucked up history books you've been reading but America didn't build up its military for the welfare of our Allies. We'd been an isolationist country since WWII - which means we've been a world player for less than a 3 quarters of a century up to this point.

We only entered WW1 as a result of German subs attacking our merchant ships, and immediately after the war we went back to isolationist refusing to join the League of Nations.

As a result of WWII and the butting of heads with USSR and another extreme superpower with a different ideology were the war hawks able to convince our representatives to increase defense spending massively - to protect ourselves from invasion and Communism, not to "protect our allies." I really hope you don't believe this...

And we can't compare our country to two countries that have expanded and colonized major parts of the world at one point? The UK still owned Honk Kong and holdings in India through the end of the 20th century, do you have any fucking clue as to what you're talking about? Britian was the last great superpower before the US and USSR, we can't compare our wealth and social structure to theirs?

Nigga you MUST be trollin'

[Yugl]

Actually we played the isolationist role until WWII. We became involved after that with our inclusion in many international bodies. The protection he refers to probably includes Japan and nations that resisted communism. Social welfare is a problem for the many reasons listed above, namely the generation gap. However, at the time of its creation, it was a good idea since at the time, there was no starting money for these programs to take effect. The problem we now see is one of path dependence. It's difficult for us to change paths because it's a rigorously protected program. At the same time, a shift will be resisted by whoever the new system burdens. Capital investment schemes (Right term?) are risky and may leave people with less money than invested. That's pretty much my summary of this without going into detail.

Edit: I might have misunderstood your point. Are you saying that the intention wasn't the protect allies even though the actual outcome does?

[Maguspk]

Social Security, without argument, does require a change. With the deficit we're running and the incoming Baby Boomers in then next 10-15 years we're in for quite a shock. Our economy is going to recover in a slow slog more than likely based on evidence from NBER and looking at unemployment statistics, so we won't be able to safely increase taxes and reduce government expenditure until well into 10 years from now. That being said, some possible fixes to SS include but are not limited to:

Means test it; fucking simple, just provide it to those who need it. There is no reason a CEO should be collecting the same amount of SS that a single parent who just retired at 65 is getting.

Increase the age; it was made long ago and since then our life expectancies have risen drastically, it's stupid to think the age should not rise along with the rise in life expectancy.

Medicaid also has to go, keeping this stupid as fuck shit that Bush implemented to make his parents happy is retarded. The worst part is we've got the fucking pharmaceutical companies exploiting the fuck out of the stupid system by making any drug they can put into a bottle and sell for 100+ dollars. Just turn on your television and look at all the drugs, pharmaceutical companies don't have to worry about selling them because the government will be buying them. We also pay inflated prices, Canadians pay way less for the same drugs we pay more for because of this retarded system.

Anyone who thinks taxing the rich more or ending the war will magically fix our problems needs to wake the fuck up and smell the coffee. We need to change some things fundamentally once we come out of this recession and it's not as simple as 'leave iraq alone!' or 'tax those rich people 100%!'. Sorry Finesse that was the stupidest thing I've read all day, tax them 100%, really? Nobody is forcing them to operate from within the US, they only do it because it's so fucking logical to. If they are being taxed 100% over a certain dollar amount they would have to be retarded, which they aren't, to stay in the U.S.

[Yugl]

[I]Means test it; fucking simple, just provide it to those who need it. There is no reason a CEO should be collecting the same amount of SS that a single parent who just retired at 65 is getting.

What if that single parent is making $50,000 due to informal services (Lets say tutoring for SAT in a rich neighborhood), but professionally works as a teacher? Where do we cut the in income? What about differences in states (i.e. people in some states may be more susceptible to X conditions that cause Y health problems)?

[Maguspk]

What if that single parent is making $50,000 due to informal services (Lets say tutoring for SAT in a rich neighborhood), but professionally works as a teacher? Where do we cut the in income? What about differences in states (i.e. people in some states may be more susceptible to X conditions that cause Y health problems)?

I didn't propose the fucking formula for means testing it, I was giving an off the cuff example. Income should affect the amount, if any, that you receive; if you're making over a certain amount you don't need it, that simple. Where they draw the line or what gradient they use, that's above my pay grade.

SS isn't, and wasn't meant to be, a retirement fund everybody automatically gets, it was a fucking lottery for anyone lucky enough to live past the average life expectancy and no longer able to work, because back then working usually involved physical labor. Today the situation is entirely different, hence why the system requires a change.

[MF Perm tha Fineass]

Edit: I might have misunderstood your point. Are you saying that the intention wasn't the protect allies even though the actual outcome does?

Yeah, our forward deployed bases are not to protect other nations, it's to protect our strategic access of resources.

[Yugl]

I agree to an extent Finesse.

I didn't propose the fucking formula for means testing it, I was giving an off the cuff example. Income should affect the amount, if any, that you receive; if you're making over a certain amount you don't need it, that simple. Where they draw the line or what gradient they use, that's above my pay grade.

SS isn't, and wasn't meant to be, a retirement fund everybody automatically gets, it was a fucking lottery for anyone lucky enough to live past the average life expectancy and no longer able to work, because back then working usually involved physical labor. Today the situation is entirely different, hence why the system requires a change.

I was pointing out how easy you say it is to come up with these means tests, yet there are certainly factors that will make it difficult to derive.

[MF Perm tha Fineass]

I agree to an extent Finesse.

I had the fortunate experience of being forward deployed in Japan while in the Navy and played war games with the South Korean, Japanese, Australian, and Singaporean navies. Every drill that took places was protecting major urban hubs and ports from full on assault as well as areas planned for future mapping and drilling and fishing regions, as well as shipping routes for merchant goods.

It's all about resources. My wartime post was in the command center of an Aegis Class Cruiser, I manned the radar that watched for missile and airborne attacks known as the SPY-1A which meant I attended briefings with the CO, XO, and DIVO's from pertinent Divisions of the ship. I even had to do monthly presentations on the cross sections of missiles from every known threat AND ally and how to detect them on three radars.

After my briefing was over I had to sit through tactical briefings where officers would specifically point out trade routes, offshore drilling sites and potential offshore drilling sites, as well as distances to strike ports and major cities.

It is pure fact that were are stationed at these forward bases to protect our own necks and keep the fight as far away from home as possible as well as to protect trade.

[Yugl]

It sounds about right though. What else would they focus on? Securing HelloKitty Factories (No offense, but this joke is priceless)? In modern warfare, resources are important.

[MF Perm tha Fineass]

It sounds about right though. What else would they focus on? Securing HelloKitty Factories (No offense, but this joke is priceless)? In modern warfare, resources are important.

lol, all I'm trying to say is the last thing we have interest in is actually protecting allies from attack. It's about expansionism and not only protecting resources but the acquisition of resources.