In a nutshell there are three important years to note: 2010, 2017, and 2041. (This is blatantly copy/pasted from here.

2010: This year the annual Social Security surpluses that Congress has been borrowing and spending on other programs will begin to shrink. From that point on, Congress will have to find other sources to replace the money that it borrows from Social Security or shrink spending. By 2017, Congress will have about $80 billion less to spend annually.

2017: The year projected that Social Security will begin spending more in benefits than it takes in with taxes. We'll have to borrow money from the government and other programs to keep benefits as they are. The billions that go into Social Security each year will make it harder to find money for other government programs or will require large and growing tax increases.

2041: The year that the Social Security trust fund runs out of its special issue bonds. Even though the end of those bonds will require a 25 percent benefit reduction, Congress would have been paying more than $300 billion a year (in 2008 dollars) to repay those bonds for about seven years by the time the trust fund runs out. Congress will have to do this through some combination of other spending cuts, new taxes, or additional borrowing. These are the same choices that Congress would face without the trust fund.

So far, the various lines of thought on this topic all agree on a few major points:

1: The longer we wait to do something, the worse the problem will be when we do.

2: Most people do not want to see benefits cut. The tiny bit that do suggest a minor cut are normally met with very aggressive resistance.

3: Our three major options are: Cut benefits, raise taxes, raise the retirement age, or some combination of the three.

Since it seems nobody agrees with my plan on a fourth option of lowering the minimum age required to be employed down to 6, I'm going to guess that we as a country are going to raise the retirement age, with a minor tax increase. However, the overall deficit we're looking at in 2008 dollars is currently projected to climb up to 13.6 trillion dollars (Yes, with a T).

Anyway, any other thoughts on this topic? It's the kind of stuff nobody cares about now, but we'll be hearing more and more about it in the next 5 years or so.

The problem is that, even perfectly administered, SSI is a broken system. The entire model of paying into a slush fund that's used to pay for present retirees and counting on future productivity to pay for you when you retire is irredeemably dysfunctional.

None of the solutions you've listed here will fix it. Most won't even delay the collapse much.

There are no two ways about it, social security needs to be privatized or it will necessarily collapse. Privatization would turn social security from a bleeding money sink into an enormous asset that provides liquidity for traded businesses and actual returns for the account bearer, it would be like turning nuclear waste into platinum.

However, even if the stock market rebounds from it's present state, it's incredibly unlikely that this is going to happen with the incoming administration. More likely, some of the meaningless stopgap fixes you mention will be used, in addition to an idea floated a few months ago by Barney Frank and a few other lefties in congress.

The idea is to seize private 401k accounts and add them to the social security system in exchange for "guaranteed" retirement payments. They denied the very existence of this idea for a while until someone who actually tapes C-SPAN produced the actual proposal (C-SPAN's own archives had the comment stricken from the record, congress can apparently do that).

If there was ever a time for such a plan, now is it, with the entire government under the control of the left and people terrified about their retirement accounts because of the dip in the stock market.

Also, Congress needs to stop borrowing money from Social Security. Now.

So here's my plan.

1- Loosen restrictions for immigrant workers, allow for 2-4 year work visas for unskilled labor, renewable and convertible to citizenship as long as they are not causing any trouble (crime, ect). This will re-direct us towards the bottom heavy system we need.
2- Social Security funds locked down, congress can no longer appropriate them for routine spending. Social Security money is instead invested in highly stable bonds to assure a small but steady growth.
3- Raise the retirement age. 70. Allow for retirements for medical purposes such as advanced diabetes so that those who cannot work at 65 can retire, but those who can keep expanding that base.

Edit: Privatization alone will not save social security, unless we're expecting China-like economic growth for the foreseeable future.

Blindy. fucked around with this message on 11-24-2008 at 07:34 AM.

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x--Blindy.O-('-'Q) :
The Fourth option is to increase the taxable base via immigration.

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Wow, that's a terrible idea. For one it's a stopgap and won't fix anything, and for two it'll make the problem that much worse when all those immigrants retire, particularly when many of them have not been paying into the system for very long.

quote:

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1- Loosen restrictions for immigrant workers, allow for 2-4 year work visas for unskilled labor, renewable and convertible to citizenship as long as they are not causing any trouble (crime, ect). This will re-direct us towards the bottom heavy system we need.
2- Social Security funds locked down, congress can no longer appropriate them for routine spending. Social Security money is instead invested in highly stable bonds to assure a small but steady growth.
3- Raise the retirement age. 70. Allow for retirements for medical purposes such as advanced diabetes so that those who cannot work at 65 can retire, but those who can keep expanding that base.

Edit: Privatization alone will not save social security, unless we're expecting China-like economic growth for the foreseeable future.

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What you're describing here is basically government administered privatization, if there is such a thing. Why on earth would you want to do all this and go out of your way to avoid giving people their own accounts? Do you really trust government to just throw that firewall between SSI and the general fund back up and not think of touching it again?

And yes, privatization alone will fix SSI, with or without china-like growth or any growth at all, if by "fix" you mean prevent unfunded government outlays several times our GDP.

We've got an immediate crunch coming up with the baby boomer generation retiring, and that can be covered with the immigration plan. If we simultaneously throw the wall up, and we're speaking in hypothetical about plans here, so yes I'm assuming we can keep the partition going between SSI funds and tax funds. Then we can fund the retirement of the immigrant plan generation as well as future generations on the investment proceeds.

Blindy. fucked around with this message on 11-24-2008 at 08:31 AM.

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We all got dumber when Pvednes said:
You can have our immigrants. All of them, please.

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Ok, but only if you take our unions.

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Steven Steve had this to say about Matthew Broderick:
Why would he want our onions!?

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Why would you want his immigrants?

I've met some onions who were excellent cooks.

Problem solved.

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Blindy. was naked while typing this:
I think it's a fantastic idea to have SSI be something you could opt out of, but I don't see how you could do that without killing the whole program, and any politician that suggests we kill the whole program is promptly tarred and feathered.

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I don't pay into social security