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Neither the heading nor the suggestion that SS will not be there necessarily follow from the article.
The article discusses but one of many different ways to keep SS solvent, viz. increasing employer and employee FICA rates by 1.33%. That's an increase that affects all workers, it would not tax just young people more.
Another possibility (that could be used separately or in tandem with a rate increase) is raising or removing the cap on income subject to taxation. This would tend to tax older people more, since only higher earners would be affected. Higher earners tend to be more experienced, i.e. older.
As the article points out (and has been repeated so many times in so many places), SS does not go away even if nothing is done. Only 1/4 of it goes away.
I agree. I see kids buying dumb stuff. If we tax them more, they would have less money to buy crap with. This assumes we have honest politicians who will use the money to make their lives better. But hey, at least they will buy less crap. Which will then cause deflation, which will then lower tax collection. Things will keep getting cheaper and cheaper. I like it.
I agree. I see kids buying dumb stuff. If we tax them more, they would have less money to buy crap with. This assumes we have honest politicians who will use the money to make their lives better. But hey, at least they will buy less crap. Which will then cause deflation, which will then lower tax collection. Things will keep getting cheaper and cheaper. I like it.
Or, we could: remove all politics from a fund that was never meant to be a slush fund for politicians. Invest all of the money in a well diversified portfolio and allow it to grow. That is a principle that seems to work for the rest of us.
I really don't understand the fuss about social security except that it shows how bad'/feckless politicians are. If I were king I could solve the problem easily by using the misery loves company approach. This means small increases in the amount of social security tax paid . raising the dollar figure to which the tax applies and slowly increasing the retirement age for full benefits for workers in white collar occupations. THe real problem is medicare and even if I were king I have no good somewhat painless ideas to solve that problem. Yet that problem is much less discussed perhaps because all solutions are bad.
...aggressive measures to increase program revenue...Young or Old, them's that got it will pay more.Increased revenue is always the wish (dream?) of the Liberal Left.
How Will the Next President Change Social Security? The 2016 election will be critical for retirees.ARTICLE INFO Jul 3, 2016 at 6:01PM Dan Caplinger is a contract writer for the Motley Fool
Donald Trump takes a more hands-off approach to Social Security, arguing that creating a more robust and growing economy should increase payroll tax revenue, which in turn should replenish Social Security's trust funds and allow the program to maintain benefits. Trump's emphasis on immigration reform also has implications for Social Security, because under current law, non-U.S. citizens who are in the country lawfully and meet all eligibility requirements can get benefits.
Hillary Clinton makes more specific statements about how she would change Social Security as president. She would oppose privatization efforts and fight against potential reductions to annual cost-of-living adjustments. She would keep the retirement age at its current level and oppose any tax increases or benefit cuts specifically on middle-class Americans. To shore up the program's finances, she proposes raising payroll taxes on high-income earners.
....political pressure from the Democratic Party to expand Social Security, which in turn would exacerbate the shortfall and require more aggressive measures to increase program revenue. Proposals to subject even greater amounts of income to Social Security payroll taxation could provide funding for benefit expansion, but many policymakers question whether a populist movement among the lower- and middle-class could muster enough momentum to pass such proposals in the face of opposition from high-income taxpayers.
"Trump's emphasis on immigration reform also has implications for Social Security, because under current law, non-U.S. citizens who are in the country lawfully and meet all eligibility requirements can get benefits."
I'll plead ignorance - it isn't obvious to me what those implications are. I thought that Trump's immigration policy was principally focused on three items:
Deporting virtually all persons in the US illegally (allowing reentry through proper channels),
Building a wall on one border to impede illegal crossings at that border, and
Banning entry of Muslims into the country (but not deporting those here lawfully)
None of these would affect non-U.S. citizens who are in the country lawfully. (Maybe his position on H1B visas, whatever that is?)
What mass deportation would do is reduce the net inflow (revenue less benefits paid) to Social Security by about $12B / year. That's based on SSA's Actuarial Note 151, April 2013:
While unauthorized immigrants worked and contributed as much as $13 billion in payroll taxes to the OASDI program in 2010, only about $1 billion in benefit payments during 2010 are attributable to unauthorized work. Thus, we estimate that earnings by unauthorized immigrants result in a net positive effect on Social Security financial status generally, and that this effect contributed roughly $12 billion to the cash flow of the program for 2010.
I agree with @jerry in all respects - that SS can be handled with a well-considered mix of reasonable approaches, and that Medicare is the elephant in the room.
I agree with @jerry in all respects - that SS can be handled with a well-considered mix of reasonable approaches, and that Medicare is the elephant in the room. And I also agree with a well-considered mix... WE HAD ONE !!! Lawmakers may say they want to reform the Tax Code and big government programs like Social Security — though you wouldn’t know it by the midterm election campaign. Both parties, though especially Republicans, are targeting the relatively few lawmakers who’ve endorsed the deficit-reduction plan drawn up by former Republican Sen. Alan Simpson and one-time Bill Clinton aide Erskine Bowles, regarded by many budget experts as a model of reform and that dirty word — compromise. The attacks illustrate why Congress is so reluctant to simplify the Tax Code and touch entitlements like Medicare and Medicaid: Any proposed changes provide easy fodder for political opponents. And it shows how far lawmakers are from coming to a “grand bargain” they’ve sought for years to deal with long-term spending and revenue challenges.
@msf said I agree with @jerry in all respects - that SS can be handled with a well-considered mix of reasonable approaches, and that Medicare is the elephant in the room.
And I also agree with a well-considered mix... WE HAD ONE !!!
While Obama was willing to put chained CPI on the table, not a single Republican candidate was willing to accept taking a dime more in revenue (read taxes) in exchange for large cuts in spending. Which made the whole thing look like Kabuki.
"All GOP Candidates Would Walk Away From A 10 to 1 Spending Compromise"
What mass deportation would do is reduce the net inflow (revenue less benefits paid) to Social Security by about $12B / year. That's based on SSA's Actuarial Note 151, April 2013:
While unauthorized immigrants worked and contributed as much as $13 billion in payroll taxes to the OASDI program in 2010, only about $1 billion in benefit payments during 2010 are attributable to unauthorized work. Thus, we estimate that earnings by unauthorized immigrants result in a net positive effect on Social Security financial status generally, and that this effect contributed roughly $12 billion to the cash flow of the program for 2010.
Sure. It's a misnomer to describe the paragraph I quoted as analysis. That text came from the paper's conclusion. The paper presents an analysis in the preceding couple of pages.
There it goes into detail about what the numbers represent. It decomposes non-US citizens into legal permanent residents, others authorized to be in the US, and unauthorized persons. It looks into the number who have overstayed visa, and the number who are using fraudulent birth certificates. Based on these decompositions and comps, it estimates the amount paid into SS.
On the benefits side, it looks at how many unauthorized immigrants are over age 62, what percentage have SSNs they could use to claim benefits, and what their typical benefits are. It also projects that changes made to the laws in the last couple of decades will reduce the benefits paid in the future.
Clearly a couple of pages doesn't give data in detail, but it does outline the analysis. In case that's not sufficient, it follows the conclusion with a couple of pages of Q&A going into trends, how the great recession affected figures, etc.
Instead of relying upon a few lines of conclusion, why don't you read the analysis and let us know where you feel it falls short?
Certainly the paper tosses about a lot of estimates that one could quibble with, but they don't affect the overall reasoning or point of the conclusion - that unauthorized workers pay much more into SS than they draw out. Even for a paygo system where those paying in now are not the same people as those drawing now. That's likely why the paper dedicates so much ink to trends.
If you're talking about my "analysis", I've disregarded possible payments into SS from "replacement workers". Replacing workers who pay in without drawing out (in the future) with workers who pay in but will draw out (in the future) merely increases future liabilities - that's not a balance sheet improvement. Even if you assume higher wages, that only improves the short term situation as it also magnifies the future liabilities.
Comments
The article discusses but one of many different ways to keep SS solvent, viz. increasing employer and employee FICA rates by 1.33%. That's an increase that affects all workers, it would not tax just young people more.
Another possibility (that could be used separately or in tandem with a rate increase) is raising or removing the cap on income subject to taxation. This would tend to tax older people more, since only higher earners would be affected. Higher earners tend to be more experienced, i.e. older.
As the article points out (and has been repeated so many times in so many places), SS does not go away even if nothing is done. Only 1/4 of it goes away.
Like preventing the poor from spending subsidy moneys on whipped cream, salt, and lobster! Yeah, that's the ticket.
How Will the Next President Change Social Security?
The 2016 election will be critical for retirees.ARTICLE INFO
Jul 3, 2016 at 6:01PM Dan Caplinger is a contract writer for the Motley Fool
Donald Trump takes a more hands-off approach to Social Security, arguing that creating a more robust and growing economy should increase payroll tax revenue, which in turn should replenish Social Security's trust funds and allow the program to maintain benefits. Trump's emphasis on immigration reform also has implications for Social Security, because under current law, non-U.S. citizens who are in the country lawfully and meet all eligibility requirements can get benefits.
Hillary Clinton makes more specific statements about how she would change Social Security as president. She would oppose privatization efforts and fight against potential reductions to annual cost-of-living adjustments. She would keep the retirement age at its current level and oppose any tax increases or benefit cuts specifically on middle-class Americans. To shore up the program's finances, she proposes raising payroll taxes on high-income earners.
....political pressure from the Democratic Party to expand Social Security, which in turn would exacerbate the shortfall and require more aggressive measures to increase program revenue. Proposals to subject even greater amounts of income to Social Security payroll taxation could provide funding for benefit expansion, but many policymakers question whether a populist movement among the lower- and middle-class could muster enough momentum to pass such proposals in the face of opposition from high-income taxpayers.
http://www.fool.com/retirement/2016/07/03/how-will-the-next-president-change-social-security.aspx
I'll plead ignorance - it isn't obvious to me what those implications are. I thought that Trump's immigration policy was principally focused on three items:
- Deporting virtually all persons in the US illegally (allowing reentry through proper channels),
- Building a wall on one border to impede illegal crossings at that border, and
- Banning entry of Muslims into the country (but not deporting those here lawfully)
None of these would affect non-U.S. citizens who are in the country lawfully. (Maybe his position on H1B visas, whatever that is?)What mass deportation would do is reduce the net inflow (revenue less benefits paid) to Social Security by about $12B / year. That's based on SSA's Actuarial Note 151, April 2013: I agree with @jerry in all respects - that SS can be handled with a well-considered mix of reasonable approaches, and that Medicare is the elephant in the room.
I agree with @jerry in all respects - that SS can be handled with a well-considered mix of reasonable approaches, and that Medicare is the elephant in the room.
And I also agree with a well-considered mix... WE HAD ONE !!!
Lawmakers may say they want to reform the Tax Code and big government programs like Social Security — though you wouldn’t know it by the midterm election campaign.
Both parties, though especially Republicans, are targeting the relatively few lawmakers who’ve endorsed the deficit-reduction plan drawn up by former Republican Sen. Alan Simpson and one-time Bill Clinton aide Erskine Bowles, regarded by many budget experts as a model of reform and that dirty word — compromise.
The attacks illustrate why Congress is so reluctant to simplify the Tax Code and touch entitlements like Medicare and Medicaid: Any proposed changes provide easy fodder for political opponents. And it shows how far lawmakers are from coming to a “grand bargain” they’ve sought for years to deal with long-term spending and revenue challenges.
Read more: http://www.politico.com/story/2014/10/the-ghost-of-simpson-bowles-haunts-2014-112199#ixzz4DVEQfO4v
Follow us: @politico on Twitter | Politico on Facebook
While Obama was willing to put chained CPI on the table, not a single Republican candidate was willing to accept taking a dime more in revenue (read taxes) in exchange for large cuts in spending. Which made the whole thing look like Kabuki.
"All GOP Candidates Would Walk Away From A 10 to 1 Spending Compromise"
There it goes into detail about what the numbers represent. It decomposes non-US citizens into legal permanent residents, others authorized to be in the US, and unauthorized persons. It looks into the number who have overstayed visa, and the number who are using fraudulent birth certificates. Based on these decompositions and comps, it estimates the amount paid into SS.
On the benefits side, it looks at how many unauthorized immigrants are over age 62, what percentage have SSNs they could use to claim benefits, and what their typical benefits are. It also projects that changes made to the laws in the last couple of decades will reduce the benefits paid in the future.
Clearly a couple of pages doesn't give data in detail, but it does outline the analysis. In case that's not sufficient, it follows the conclusion with a couple of pages of Q&A going into trends, how the great recession affected figures, etc.
Instead of relying upon a few lines of conclusion, why don't you read the analysis and let us know where you feel it falls short?
Certainly the paper tosses about a lot of estimates that one could quibble with, but they don't affect the overall reasoning or point of the conclusion - that unauthorized workers pay much more into SS than they draw out. Even for a paygo system where those paying in now are not the same people as those drawing now. That's likely why the paper dedicates so much ink to trends.
If you're talking about my "analysis", I've disregarded possible payments into SS from "replacement workers". Replacing workers who pay in without drawing out (in the future) with workers who pay in but will draw out (in the future) merely increases future liabilities - that's not a balance sheet improvement. Even if you assume higher wages, that only improves the short term situation as it also magnifies the future liabilities.