Social Security in the cross hairs... (Stage is being set for cuts to Social Security)

[Human101948]

Social Security may be at risk after the November elections. Critics are writing op-eds saying that benefits – relative to previous earnings – are very high, and the Congressional Budget Office (CBO) has come out with an astounding estimate of the 75-year deficit. The stage is being set for benefit reductions. Cutting benefits would be a huge mistake, given that half the private sector workforce does not participate in an employer-sponsored retirement plan and that those lucky enough to participate in a 401(k) have combined 401(k)/IRA balances of $111,000 as they approach retirement. Therefore, it is very important to take a hard look at the emerging characterization of the Social Security program. This blog focuses on the 75-year deficit.

The 75-year deficit is the difference between the income rate and the cost rate. The income rate is calculated by adding the current trust fund balance to the present discounted value of scheduled taxes and then dividing by the present discounted value of taxable payroll over the 75-year period. The cost rate is the present discounted value of scheduled benefits divided by the same payroll number. In 2015, the Social Security Trustees Report had an estimated deficit equal to 2.68 percent of taxable payroll. That figure means that if payroll taxes were raised immediately by 2.68 percentage points – 1.34 percentage points each for the employee and the employer – the government would be able to pay the current package of benefits for everyone who reaches retirement age at least through 2089.

http://www.marketwatch.com/story/social-security-in-the-cross-hairs-2016-01-20

[Jerry442]

1. No doubt adjustments can be made...

...to keep SS on a sound financial footing, but a 75 year projection?! Don't you think that there might be a few utterly unpredictable game-changing events in that time period? Aren't these the same people who think scientists can't possibly predict climate change even 3-4 years into the future?

[n2doc]

2. And no one ever questions the deficit caused by rampant military spending

Never.

[appal_jack]

3. Gotta have priorities...

...and they sure have them. K&R,

-app

[smirkymonkey]

9. I know, eff that!

[KentuckyWoman]

4. Here's a thought

quit stealing from the social security SURPLUS to pay for wars......

Any other discussion of "saving social security" that starts from any other place is BS. If you need to raise taxes then admit you are doing so to pay for war and bridges to nowhere.

Al Gore called it a lock box and got ridiculed for it. But he was right then and he would be right now. Put the SS money aside only for SS and pow....... problem solved.

[Trailrider1951]

5. Just raise the fricken cap already!

Everyone should pay in a certain percentage of ALL earned income. That would fix any shortage for decades to come! Also, after we boomers die off, there will be far fewer people to collect coming behind us. Perhaps you Gen Xers and Millennials can then get more money for a better retirement than we are getting.

[passiveporcupine]

6. This is from 2005

When Social Security was launched 70 years ago Sunday, it was meant to be a supplement for retirees, not a full pension. But today, 10.6 million people, or 22% of the 48 million who will receive Social Security benefits this year, live on that check alone, the Social Security Administration says.

Those living on nothing but Social Security are often single women and minorities. AARP, the senior advocacy group, says 25% of retired women, including 46% of unmarried Hispanic women, have no income beyond Social Security. AARP also says 33% of retired African-Americans live on Social Security alone.

So, I wonder how many are living on only SS today, ten years later? I know I am.

Now SSA.gov says: Average monthly retirement benefit is $1341 for 2016. ($16,092 yearly)

Federal poverty rate for 2016 for a single person is $11,770. $16,242 is 138 percent of poverty.

And they want to cut benefits?

Sick bastards. Especially after the crash that left a lot of seniors or soon to be retired with serious losses in their 401Ks.

[CBGLuthier]

7. Considering the stock market is a scam and companies don't offer pensions any more WTF are

people to do?

I live in Mauritius a developing but still poor nation in Africa and the government has a pension plan for everyone over 60. America has its collective head up its ass when it comes to basic human decency. All that fucking pioneer revolutionary spirit I guess. Oh well, three more months and I am coming back to the land of the terminally insane.

[passiveporcupine]

8. Oh sorry to hear that.

But you are right. We are the nation with our head stuck up our ass!

[smirkymonkey]

10. Our priorities as a nation are so effing far out of whack it's beyond insane.

We need some leadership, like yesterday.