My Views

Quote from Mvic:

What you have failed to understand is that the way things work in the good old US of A is that people (groups) take their self interest and work from that point and fashion some policy and then spin it so that the politicians will be able to look good when they sell it to their constituents. Very rarely does policy stem from what is actually a logical plan to promote the greater good which is why things are so screwed up.
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I understand this now, and I understood it then. My intention was and is to show the world that great things are possible when you set aside your own personal gain.

Unfortunately, I have encountered much more complacency and conformity than I had anticipated. Nevertheless, I maintain my faith in the American people, and that is why I continue to work this hard.

When all else fails, hope remains.
 
We need the Naders of this world to stick to their guns and keep their faith in humanity and to never give up on their principles. Every now and then they are in the right place at the right time and shape history.

Good luck to you Afterburner, by the way one way you could get your word out is by submitting op ed pieces to all the papers, also to various academic and semi academic social science journals (though depending on your own academic credentials you would probably have to do this in collaboration with a doctoral student or prof., might be good for you and interesting to talk to one anyway and see if you can get them interested in your ideas).
 
Quote from AFterburner:

I understand this now, and I understood it then. My intention was and is to show the world that great things are possible when you set aside your own personal gain.

Unfortunately, I have encountered much more complacency and conformity than I had anticipated. Nevertheless, I maintain my faith in the American people, and that is why I continue to work this hard.

When all else fails, hope remains.
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The world knows what is possible but in order for things like that to happen you need a meeting of the minds otherwise the prisoners dilemma rules. The reason a so called meeting of the minds (where everyone acts on a broader self interest) is rare is that it is usually based on mass fear or hysteria of some kind. Keep in mind though that this meeting of the minds amongst the populous is not always positive which is why having faith in the goodness of the collective vs the goodness of the individulas is not always warranted. The Nazi's in Germany would be a good example of a meeting of the minds, the Chinese too under Mao. But also the founding fathers are an example.
 
I believe one of the major shortcomings of Social Security is that the trust funds are not actively invested.

The world's best pension system, the California Public Employees Retirement System, is a model of how a retirement system should be run. Last year employees paid in $2.2 bil, the employers (state and local gov't) paid in $4.3 bil, and investment income brought in a whopping $24.3 bil. In other words, 78% of the actuarial needs of employee pensions are being met by the funds' own assets.

Imagine if SS funds were actively invested, and had 78% of its actuarial needs funded from investment income. SS reform would not be a topic. There might even be talk of lowering the retirement age.

CalPERS has an investment board that does a great job with diversification, as well as corporate shareholder activism to call CEOs on the carpet when companies are mismanaged.

Sadly, it is this government shareholder activism is why any move towards SS investment will always be thwarted. Corporate America is deathly afraid of the thought of CalPERS' style of shareholder activism if it was done at the scale of SS. Which is unfortunate because an investment income stream would fix SS funding problems once and for all.
 
Jamis359 well said. There are MANY things usa can do to help with all of our financial situations. Chamber of Commerce is running usa now SO lets have some dividends from USA properties currently being used by corporations. If a canadian corp. is mining govt land in utah let a small percent go into retirement accounts. I am thinking of income streams. Children when born soon get ss numbers and those dollars should be credited to there accounts. If usa corps choose NOT to build any oil refineries (like the last 30 years to increase corp profits) then bar them from leasing usa properties for oil/gas exploration. They can NOT help themselves by screwing everyone else. Give the gulf leases to corps that are good stewards of usa properties. Bar them for say 100 years.
 
Great idea except for the fact that there is no actual money ion the SS fund, it is being used by the government to run its day to day business. If we actually had to come up with the money we would have to issue so much debt that we probably wouldn't come out ahead with the rise in interest rates it would cause.
 
Quote from Mvic:

Great idea except for the fact that there is no actual money ion the SS fund, it is being used by the government to run its day to day business. If we actually had to come up with the money we would have to issue so much debt that we probably wouldn't come out ahead with the rise in interest rates it would cause.
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Exactly. Since Social Security is a "pay-as-you-go" system, every dollar invested in stocks would have to be borrowed against the national debt in order to sustain the program. Therefore, the private stock account proposal is like borrowing money from a credit card in order to invest in the stock market. Furthermore, while government run pension programs may be doing good right now, corporate pension programs are in serious trouble.

http://www.pactamerica.com/pbgc.htm

I believe that the greatest threat to American workers is not the Social Security issue, but the pension situation. Therefore, we could add a pension component to Social Security, and these personal add-on accounts would help restore the Social Security trust fund while providing younger workers with a solid pension.

According to the Social Security Administration, the effective interest rate on the $1.6 trillion trust fund was 5.7% for calendar year 2004.

http://www.ssa.gov/OACT/ProgData/effectiveRates.html

As a younger worker, I would much rather have my income finance the Social Security trust fund so that I could start earning 5.7% on my retirement savings. Treasury Bonds are viewed as the safest investment in the world, and where else could a person expect to earn 5.7% interest risk-free?

No matter what else happens, the trust fund must be repaid. If we were to add a pension component to the Social Security system, we could repay the trust fund while also providing for the future. Therefore, my proposal would benefit both the young and old alike.
 
Quote from AFterburner:

Exactly. Since Social Security is a "pay-as-you-go" system, every dollar invested in stocks would have to be borrowed against the national debt in order to sustain the program.
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According to the 2005 SSA Annual Report of the Trustees, the OASDI portion of the SS Trust Fund:

revenues +657 bil
benefits paid -501 bil

net increase in trust fund +156 bil

current trust fund balance +1,687 bil

SS is close but not quite pay as you go. SS taxes are generating surplus revenues for the Trust Fund. It's not enough to meet actuarial needs, true, but it's not accurate to say the Trust Fund is broke or doesn't exist. According to the report, excess funds goes to Treasury and 'special bonds' are issued, earning some interest for SS.

If the $1.6 trillion were put to work in the markets -- investing in American business startups, stocks, real estate, muni bonds, etc. -- the higher return would help the SS 'crisis' and it would stimulate the economy. Seems win-win to me.
 
Quote from jamis359:

If the $1.6 trillion were put to work in the markets -- investing in American business startups, stocks, real estate, muni bonds, etc. -- the higher return would help the SS 'crisis' and it would stimulate the economy. Seems win-win to me.
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The $1.6 trillion trust fund has already been spent to help support our budget deficits. Even though the trust fund earns 5.7% interest, this interest is paid by our tax dollars. The only benefit is that we pay this interest to ourselves.

The government would need to borrow $1.6 trillion to pay back the trust fund before this money could be invested in stocks. Our tax dollars would still need to pay the interest on this borrowed money, but this time we would be paying this interest to outside investors.

Assuming that the government refinanced the trust fund at the current rate of 5.7%, stocks would need to produce annual gains of more than 11.4% in order to provide us with better returns than the the trust fund is currently earning.
 
From my report dated February 23, 2005:

The Social Security trust fund was established with excess payroll tax dollars. Therefore, workers were taxed in order to form the trust fund. This money was then lent to the government and Social Security was given "special issue" bonds that pay interest. However, the interest on government bonds is paid out of income tax revenue. Therefore, workers were again being taxed to pay the interest on their own “special issue” bonds. The problem is that the government spent all the money in the trust fund on various government programs. In order to pay the currently scheduled Social Security benefits, these “special issue” bonds must be redeemed starting in 2018. Since bonds are paid back out of income tax revenue, we will now require additional tax money in order to replenish the money in the trust fund. Therefore, the trust fund "investment" actually involves double taxation. The American people paid additional payroll taxes to establish the trust fund, and now they must pay additional income taxes in order to pay it back. The government must now decide whether it will raise taxes, issue new bonds, or cut benefits.

The most likely outcome is that the government will issue new bonds in order to pay back the trust fund.
 
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