Democrats Are Once Again Sabotaging Desperately Needed Social Security Reform

[flack]

This conversation will be mote in less than 3 years. AI will run the world.

 

[flack]

Libs have one solution to all problems: make the rich pay more. Or, put another way, let other people pay to solve the problem.

Democrats love to spend other people"s money.

 

[WorldWatcher]

Wealthy people receive social security checks even if they don't need them.

Define "wealthy".

Now vary that based on cost of living in different parts of the country. "Wealthy" in rural Mississippi is different than "wealthy" in Hawaii.

There is also massive fraud.

The "massive fraud" occurs in Social Security Disability Insurance, not in SS Retirement.

With that said I'm all for:

• Actual audits of SS Retirement fund expendatures (not Musk's Mr. Big Balls) but actually qualified non-government entities with expertiese in the area.
• Upgrading the SSA core COBOL systems to a more modern system to improve
• Improved cross reporting of life status of beneficiaries upon death.
• Improved cross-reporting between the IRS, State Departments of Taxation, Medicare, etc. to identify possible fraud. (Does anyone thinking that Bubba not reporting grandma's death is actually going to take her corpse for medical care and file Federal/State income taxes?)

WW

 

[WorldWatcher]

Sigh. . . . We're not going to fix SS just by jacking up taxes on the wealthy. We're talking about an annual shortfall of $350 billion starting in 2035--not just once, but annually, and getting worse after that. Taxes alone are not going to fix this.

There has got to be some sane, reasonable adjustment on benefits to reflect current lifespan and population reality.

No.

What needs to happen is a restructuring of SS.

I've come to believe that we need a re-evaluation of SS Taxes in general. The workforce and economy are very different than they were in 1935 when the system was created. Now I'm leaning more toward, making SS Tax applicable to all income the same way it is determined for Income Tax (wage, interest, dividends, short term stock commodities, and long term capital gains) as a new revenue source. As such:

• Current SS tax of 12.4% would remain (6.2% by the EE and 6.2% by the ER).
• Non-wage income would be taxed at a rate equal to 25% of the total FICA rate or another way to say it as 1/2 of the individual EE rate. That would currently be 3.1%.
• Financial institutions would be required to collect the 3.1% at the time of posting, just like employers (ERs) collect it at the time of payment.
• Because the non-wage rate is 25% of the wage rate (3.1% compared to the FICA total of 12.4%), then 25% of non-wage income would be credited to SS Income for that year.
• Current cap of 175K on wage income could remain the same. (Maybe tweaked some as it is pretty low.)
• A cap of 43.7K would also apply to non-wage income. (25% taxed, so 25% of wage cap)
• The sum of the wage credit and non-wage credit is posted as the total SS Income for the year which is then used to determine SS benefit amounts.

Example:

A high wage earner makes $300K in wages, taxes are collected on wages up to $160K for a total of $19,840 in wage tax. Applicable income credited for the year for future benefits calculations is $160K. If the same person has in additional $100K of non-payroll investment income, the SS Tax would be $3,100 at 3.1%. Total SS Taxes would then be $22,940. 25% of the $100K passive income would be credited to SS Income for the year equaling $25K since the tax rate is 25% of the full FICA rate. So the individuals total SS Income credited for the year would be $160 + $25K = $185K.

A "Low Wage" earner making say $40K would pay 6.2% ($2,480) on wages. If they had $500 in interest than $3.1% = $15.50). Total SS Income for the year would then be credited as $40,125. $125 being 25% of the $500 in interest.

WW

 

[Lisa558]

Democrats love to spend other people"s money.

Yes, IME they are very cheap with their own. They can talk your ear off at a restaurant about how we don’t help the working class, and then count out the nickels to get to precisely a 15% tip.

 

[Fang]

The average life expectancy in the US for males is 75.8. They want to raise social security to 69? I get 5 years (if I’m lucky) to collect on the payments I’ve been making since I was 16? F that sh!t. Find the answer somewhere else.

 

[mikegriffith1]

No.

What needs to happen is a restructuring of SS.

I've come to believe that we need a re-evaluation of SS Taxes in general. The workforce and economy are very different than they were in 1935 when the system was created. Now I'm leaning more toward, making SS Tax applicable to all income the same way it is determined for Income Tax (wage, interest, dividends, short term stock commodities, and long term capital gains) as a new revenue source. As such:

• Current SS tax of 12.4% would remain (6.2% by the EE and 6.2% by the ER).
• Non-wage income would be taxed at a rate equal to 25% of the total FICA rate or another way to say it as 1/2 of the individual EE rate. That would currently be 3.1%.
• Financial institutions would be required to collect the 3.1% at the time of posting, just like employers (ERs) collect it at the time of payment.
• Because the non-wage rate is 25% of the wage rate (3.1% compared to the FICA total of 12.4%), then 25% of non-wage income would be credited to SS Income for that year.
• Current cap of 175K on wage income could remain the same. (Maybe tweaked some as it is pretty low.)
• A cap of 43.7K would also apply to non-wage income. (25% taxed, so 25% of wage cap)
• The sum of the wage credit and non-wage credit is posted as the total SS Income for the year which is then used to determine SS benefit amounts.

Example:

A high wage earner makes $300K in wages, taxes are collected on wages up to $160K for a total of $19,840 in wage tax. Applicable income credited for the year for future benefits calculations is $160K. If the same person has in additional $100K of non-payroll investment income, the SS Tax would be $3,100 at 3.1%. Total SS Taxes would then be $22,940. 25% of the $100K passive income would be credited to SS Income for the year equaling $25K since the tax rate is 25% of the full FICA rate. So the individuals total SS Income credited for the year would be $160 + $25K = $185K.

A "Low Wage" earner making say $40K would pay 6.2% ($2,480) on wages. If they had $500 in interest than $3.1% = $15.50). Total SS Income for the year would then be credited as $40,125. $125 being 25% of the $500 in interest.

WW

Sounds like an overly complicated recipe to kill the economy and to send capital fleeing to other nations.

You realize that capital gains income is already subject to federal taxes, right? Short-term capital gains are treated as regular income and taxed according to the standard federal income tax brackets. Long-term capital gains are taxed at 0%, 15%, or 20%. No rich person pays less than 15% in capital gains taxes, and most pay 20% (whereas the vast majority of middle-income taxpayers pay a marginal income tax rate of no more than 15%).

Here are some much simpler solutions:

-- Lift the cap on income that is subject to the payroll tax, period. Just end it. That would only affect high-income earners, both those who earn their money from investments (capital gains) and those who earn their money from salaried income.

-- Apply a reasonable means test on a sliding scale so that those who already have a comfortable private retirement income get a reduced benefit or no benefit, based on income.

-- Raise the age for early SS retirement to 64, but also vastly reduce the penalty for early retirement to encourage more people to take that option. This would save quite a bit of money.

-- Raise the age for full SS retirement by just 1 year, to 68.

 

[Toddsterpatriot]

This conversation will be mote in less than 3 years. AI will run the world.

At least it won't be moot.

 

[flack]

At least it won't be moot.

fy

 

[Lisa558]

The average life expectancy in the US for males is 75.8. They want to raise social security to 69? I get 5 years (if I’m lucky) to collect on the payments I’ve been making since I was 16? F that sh!t. Find the answer somewhere else.

That’s the expectancy from birth. If you’ve gotten to 65, your average life expectancy is 82. So, on average, you collect for 17 years. And if you maintain good habits - exercise, don’t overdo alcohol, eat healthy, etc. - quite likely you will get to 85 and beyond.

 

[flack]

That’s the expectancy from birth. If you’ve gotten to 65, your average life expectancy is 82. So, on average, you collect for 17 years. And if you maintain good habits - exercise, don’t overdo alcohol, eat healthy, etc. - quite likely you will get to 85 and beyond.

If we didn't have a certain segment of society it would be a lot higher.

 

[mikegriffith1]

Notice that I'm not talking about imposing a means test just on the rich but about imposing a means test on the upper middle class and the affluent, i.e., those with a private retirement income of at least $60K per year. They are not "rich," but they are well of or affluent and do not need their full SS benefit nearly as much as people who have no private retirement income or people whose private retirement income is less than $30K per year.

Here is one possible sliding scale, with PRI standing for annual "private retirement income":

PRI: $0-$18K
SS benefit: 135% of currently scheduled benefit

PRI: $19K-$30K
SS benefit: 125% of currently scheduled benefit

PRI: $31K-$40K
SS benefit: 115% of currently scheduled benefit

PRI: $41K-59K
SS benefit: 100% of currently scheduled benefit

PRI: $60K-$69K
SS benefit: 80% of currently scheduled benefit

PRI: $70K-$79K
SS benefit: 60% of currently scheduled benefit

PRI: $80K-$89K
SS benefit: 45% of currently scheduled benefit

PRI: $90K-$99K
SS benefit: 30% of currently scheduled benefit

PRI: $100K-$120K
SS benefit: 20% of currently scheduled benefit

PRI: $121K-$150K
SS benefit: 10% of currently scheduled benefit

PRI: $151K and above
SS benefit: $0

 

[flack]

Notice that I'm not talking about imposing a means test just on the rich but about imposing a means test on the upper middle class and the affluent, i.e., those with a private retirement income of at least $60K per year. They are not "rich," but they are well of or affluent and do not need their full SS benefit nearly as much as people who have no private retirement income or people whose private retirement income is less than $30K per year.

Here is one possible sliding scale, with PRI standing for annual "private retirement income":

PRI: $0-$18K
SS benefit: 135% of currently scheduled benefit

PRI: $19K-$30K
SS benefit: 125% of currently scheduled benefit

PRI: $31K-$40K
SS benefit: 115% of currently scheduled benefit

PRI: $41K-59K
SS benefit: 100% of currently scheduled benefit

PRI: $60K-$69K
SS benefit: 80% of currently scheduled benefit

PRI: $70K-$79K
SS benefit: 60% of currently scheduled benefit

PRI: $80K-$89K
SS benefit: 45% of currently scheduled benefit

PRI: $90K-$99K
SS benefit: 30% of currently scheduled benefit

PRI: $100K-$120K
SS benefit: 20% of currently scheduled benefit

PRI: $121K-$150K
SS benefit: 10% of currently scheduled benefit

PRI: $151K and above
SS benefit: $0

It’s still called stealing.

 

[WorldWatcher]

Notice that I'm not talking about imposing a means test just on the rich but about imposing a means test on the upper middle class and the affluent, i.e., those with a private retirement income of at least $60K per year. They are not "rich," but they are well of or affluent and do not need their full SS benefit nearly as much as people who have no private retirement income or people whose private retirement income is less than $30K per year.

Here is one possible sliding scale, with PRI standing for annual "private retirement income":

PRI: $0-$18K
SS benefit: 135% of currently scheduled benefit

PRI: $19K-$30K
SS benefit: 125% of currently scheduled benefit

PRI: $31K-$40K
SS benefit: 115% of currently scheduled benefit

PRI: $41K-59K
SS benefit: 100% of currently scheduled benefit

PRI: $60K-$69K
SS benefit: 80% of currently scheduled benefit

PRI: $70K-$79K
SS benefit: 60% of currently scheduled benefit

PRI: $80K-$89K
SS benefit: 45% of currently scheduled benefit

PRI: $90K-$99K
SS benefit: 30% of currently scheduled benefit

PRI: $100K-$120K
SS benefit: 20% of currently scheduled benefit

PRI: $121K-$150K
SS benefit: 10% of currently scheduled benefit

PRI: $151K and above
SS benefit: $0

Nutz! - to quote famous General.

First of all your number a perposterous to anyone with common sense.

Middle class is normally defined as those makeing between 2/3rds and twice the median income. In the 2023 census median income was $80,000. That means Middle Class was between $60,000 - $160,000.

Yet you say (falsely) that you are means testing upper middle class and the affluent, yet as soon as someone hits middle class your schedule reduces benefits and eliminates them totally becore ever geting to "afluent".

What your plan does in punish those that prepared for retirement because now when they take that money out of retirement savines (401Ks, 403Bs, 457s, IRA) and that money becomes income it "he we are going to take your social security away".

On the other hand someone that earned the same amounts of money, but spent their income on fancy cars, loose women, and expensive vacations - well you we are going to reward for your piss poor planning.

Screw that.

Those with $1,000,000 or more in AGI, that makes sense. Hiting Blue Collor workers that did the right thing? No.

WW

 

[mikegriffith1]

Nutz! - to quote famous General.

First of all your number a perposterous to anyone with common sense.

Middle class is normally defined as those makeing between 2/3rds and twice the median income. In the 2023 census median income was $80,000. That means Middle Class was between $60,000 - $160,000.

Huh? I'm talking about private retirement income, not their current earned income. I made that clear.

Yet you say (falsely) that you are means testing upper middle class and the affluent, yet as soon as someone hits middle class your schedule reduces benefits and eliminates them totally becore ever geting to "afluent".

Again, as I made clear in the reply, I'm talking about their private retirement income, not their earned income. Most middle-class workers are not going to have a private retirement income of $60K to $69K per year, much less $70K to $89K, with the exception of some policemen and firemen, who understandably have unusually generous pension plans.

What your plan does in punish those that prepared for retirement because now when they take that money out of retirement savines (401Ks, 403Bs, 457s, IRA) and that money becomes income it "he we are going to take your social security away".

On the other hand someone that earned the same amounts of money, but spent their income on fancy cars, loose women, and expensive vacations - well you we are going to reward for your piss poor planning.

Blah, blah, blah bleeding-heart socialist mindset blather. The simple fact is that people who have private retirement incomes of $60K or more can afford to have their SS benefit reduced on a reasonable sliding scale so that we can keep the system solvent and provide a better SS benefit for those who have no private retirement income or who have a very small private retirement income.

Screw that.

Those with $1,000,000 or more in AGI, that makes sense. Hiting Blue Collor workers that did the right thing? No.

WW

Well, and there you go, and this is why you guys demagogue every sane, reasonable SS reform proposal. This is why we're staring down the barrel of an SS system that will be unable to pay for 100% of scheduled benefits in about 6 years, and that will only be able to pay for 75% of scheduled benefits in 10 years.

Your only solution is to just jack up taxes on the rich. Any number of studies have proved that this will not fix the problem and is not a viable long-term solution. Again, for the fifth or sixth time, in 2035, the annual SS shortfall will be $350 billion, and it will go up from there.

And of course you guys scream against any suggestion that we acknowledge life-expectancy reality and modestly raise the minimum ages for drawing reduced and full SS benefits.

We could attract millions of soon-to-be seniors to draw the reduced/early SS benefit at age 64 if we drastically reduced the draconian penalty for doing so. This step alone would take considerable pressure off the SS system. But, nah, you guys scream against any increase in the SS retirement ages. "Tax the rich!" is your only answer.

 

[Lisa558]

By “private retirement income,” do you mean pension plans? If not, and you include mandatory IRA withdrawals, you will discourage savings since those who live beneath their means during their working lives in order to fund their retirements will be penalized for not spending irresponsibly.

 

[WorldWatcher]

Huh? I'm talking about private retirement income, not their current earned income. I made that clear.

I understood you "private retirement income", however there is no such animal. There is "income", whether that income froms from the working, militray retirement, pension, dividends on stocks, or taking money out of a tax-defferred retirement account.

It's income.

Again, as I made clear in the reply, I'm talking about their private retirement income, not their earned income. Most middle-class workers are not going to have a private retirement income of $60K to $69K per year, much less $70K to $89K, with the exception of some policemen and firemen, who understandably have unusually generous pension plans.

Horseshit.

Those of us with other sources of income can easily reach middle class IF WE PLANNED for retirement.

What you want to do is gut pensions and the value of 401K's.

Blah, blah, blah bleeding-heart socialist mindset blather. The simple fact is that people who have private retirement incomes of $60K or more can afford to have their SS benefit reduced on a reasonable sliding scale so that we can keep the system solvent and provide a better SS benefit for those who have no private retirement income or who have a very small private retirement income.

And there it is, if you think people should get the retirement income they planned on for DECADES - you are a socialist.

Well, and there you go, and this is why you guys demagogue every sane, reasonable SS reform proposal. This is why we're staring down the barrel of an SS system that will be unable to pay for 100% of scheduled benefits in about 6 years, and that will only be able to pay for 75% of scheduled benefits in 10 years.

Rewarding those who don't plan for retirement by punishing that did plan for retiremeninmt is not sane or reasonable.

Your only solution is to just jack up taxes on the rich. Any number of studies have proved that this will not fix the problem and is not a viable long-term solution. Again, for the fifth or sixth time, in 2035, the annual SS shortfall will be $350 billion, and it will go up from there.

False, I've posted in this thread about my suggested fix to SS and it goes back to a fundamental redesign not based on "wages" it's based on "income" because the economy today is much different than it was when originally designed in 1935 and DOES NOT change the basic idea of the income cap.

And of course you guys scream against any suggestion that we acknowledge life-expectancy reality and modestly raise the minimum ages for drawing reduced and full SS benefits.

That's because it is a cut. When you raise retirement age you have to to work longer before being eligibile to draw benefits.

That is a cut.

We could attract millions of soon-to-be seniors to draw the reduced/early SS benefit at age 64 if we drastically reduced the draconian penalty for doing so. This step alone would take considerable pressure off the SS system. But, nah, you guys scream against any increase in the SS retirement ages. "Tax the rich!" is your only answer.

False, I've posted in this thread about my suggested fix to SS and it goes back to a fundamental redesign not based on "wages" it's based on "income" because the economy today is much different than it was when originally designed in 1935 and DOES NOT change the basic idea of the income cap.

WW

 

[WorldWatcher]

By “private retirement income,” do you mean pension plans? If not, and you include mandatory IRA withdrawals, you will discourage savings since those who live beneath their means during their working lives in order to fund their retirements will be penalized for not spending irresponsibly.

Anything other than wages reported on a W-2 would be "private retirement income":

• Stock Dividends,
• Interest on Savings/Certificate of Deposits,
• Union Pensions
• Private Industry Pensions,
• Government Pensions,
• Military Pensions,
• Income from rental properties,
• Withdrawls from 401K, 403B, 457, and IRA's

And you are correct, his plan is to cut or eliminate SS benefits for middle-class, blue and white collar workers that were responsible and planned for retirement and reward those that did not.

My brother - to put it kindly - was a shit bird. He had a good job and was a top chef in the region. Yet he blew his money on nice cars, loose women, and expensive vacations. When he got to old to work, under the above plan he will be rewarded for that life style with additional SS security benefits.

However I worked, saved, and took a job with a small pension and saved religiously in a 401K. I won't be "wealthy" or "afluent" in retirement, he's going to greatly reduce or eliminate middle class SS benefits.

WW

 

[Lisa558]

Anything other than wages reported on a W-2 would be "private retirement income":

• Stock Dividends,
• Interest on Savings/Certificate of Deposits,
• Union Pensions
• Private Industry Pensions,
• Government Pensions,
• Military Pensions,
• Income from rental properties,
• Withdrawls from 401K, 403B, 457, and IRA's

And you are correct, his plan is to cut or eliminate SS benefits for middle-class, blue and white collar workers that were responsible and planned for retirement and reward those that did not.

My brother - to put it kindly - was a shit bird. He had a good job and was a top chef in the region. Yet he blew his money on nice cars, loose women, and expensive vacations. When he got to old to work, under the above plan he will be rewarded for that life style with additional SS security benefits.

However I worked, saved, and took a job with a small pension and saved religiously in a 401K. I won't be "wealthy" or "afluent" in retirement, he's going to greatly reduce or eliminate middle class SS benefits.

WW

Yup, it’s a terrible idea. I saw friends spend every cent earned on expensive theater tickets, fine restaurants, international vacations, and the top trim on every new car purchase - and thus have no savings.

I, otoh, saved responsibly for my retirement years, living comfortably but not extravagantly - and now I will be punished for that by having my SS cut in half while my irresponsible friends get MORE than their SS because they have no money?

We should be encouraging saving and self-sufficiency instead of discouraging it.

 

[Admiral Rockwell Tory]

I oppose raising the full retirement age, but I do support raising the early retirement age from 62 to 63.

Nope. 67 is old enough.

This by itself would fix SS. No other actions needed. Or, the cap could be doubled with other "fixes"

Fuck that

Steal what they've earned? Fuck that.

SS is not a 401k. A better solution is to have EVERY worker in the US especially all government workers, pay into SS in lieu of their cushy government pensions.

All federal employees pay into SS already, just in case you are confused. I always love the comments about Congressman need to pay into social security despite the fact that they have since the 1970s. Probably half of all state workers do also. I'll bet the half that do not, which they did, so they can avoid the ridiculous limits that were imposed on them when they had enough SS credit from other jobs.