Social Security plan opposed by AARP

[Tab]

WASHINGTON — AARP, the nation's largest seniors organization, is coming out strongly against President Bush's plan to allow private individual accounts within Social Security.
In the newsletter it sends to its 35 million members, the group says Bush's plan would damage the most successful government program in history and abdicate on a promise made to future retirees.
"Taking some of the money that workers pay into the system and diverting it into newly created private accounts would weaken Social Security and put benefits for future generations at risk," says the December issue of the AARP Bulletin, which went to members this weekend.
...
Opposition from one of the most formidable advocacy groups in Washington could make it much harder for Bush to make headway in setting up private accounts. White House spokeswoman Pam Stevens declined to comment directly on AARP's position but said, "The Social Security system is unsustainable," and the president "believes in solving problems, not passing them on to future generations."
http://www.deseretnews.com/dn/view/0,1249,595110340,00.html

Learned their lesson from supporting the Medicare thing, I suspect...

[bemildred]

1. Always nice to see a spine in those that pretend to advocate for us. nt

[Ernesto]

8. The good news is

The AARP does not have a conflict of interest on this issue.
Plus they have a substantial opportunity to make up for the black eye they earned for their Medicare malfeasance.

[PROGRESSIVE1]

10. and they (AARP) are most certainly IN DEBT to their MILLIONS of....

members who depend on them!

[GHOSTDANCER]

11. Exactly!!! .........And not just AARP, the Federal Government.

They have gone and spent all the money that estimates show they can never repay. Doesn't the SS offices have file folders over stuffed with IOU's from the government?
They have to make up some scam so that it doesn't look like they took this money. a couple of oops corporate fraudodoolie-o-doos down the road with your privatized savings and well, no one will remember about the years and years of debt that they never could repay.


The most important thing about this issue is why all the rush? It's only apparent it's a scam. Whether the neocons are gonna make handfuls of cash over insurance contracts or to cover the theft up. They seem so concerned with an issue that is only projected to be a problem in 50 plus years. Lets wait for another competent president, A president that didn't ruin every business that he ever started to muddle around this issue.

[Florida_Geek]

2. Sad part is a lot of seniors voted for Bush

and only now are starting to see what they voted for.

[schultzee]

16. Jesus will take care of all of us. They forget that G-d helps those who

help themselves. All these fundi crazies are like lambs for * to sacrifice.

[zann725]

24. A lot of Seniors THOUGHT they voted for Kerry, but REALLY 'voted' for Bush

n/t :crazy:

[Straight Shooter]

3. Your mission: Name the most asinine statement you'll read this week.

Answer: "(bush) believes in solving problems, not passing them on to future generations."

From what turnip truck did Ms. Stevens fall?

[BrainRants]

4. Exactly!

And how's that new prescription drug program that AARP approved of last year working out for everyone?

(disclosure: I'm not a member of AARP or a senior)

[denverbill]

9. Bullshit. He's never met a problem he DIDN'T pass on to the future.

He's even forcing future generations to pay for giving his rich friends a tax cut.

[heidler1]

18. Bush not only does not fix problems. He makes them way worse.

[tyedyeto]

5. My s/o just got their latest bulliten

The headline reads:

Dear President B*,
Fix It!!!

[tmooses]

6. AARP caved in to their drug connections and backed Shrub's Medicare

n/t

[RaleighNCDUer]

7. OK. Now if they just keep it up for a few years they just might

regain my trust, and I just might rejoin.

[still_one]

12. screw aarp

they supported the * prescription drug plan and now they are crying

I love it, many of the people that voted for * are now going to be screwed by them

[retread]

13. Problem with that attitude is that we all are going to be screwed

by them, just a matter of when!

[atreides1]

23. We tried to tell them that this was coming!!!

We warned them, but they didn't listen or pay attention. So now we all go down together.

[FlaGranny]

14. I really like that last

statement: and the president "believes in solving problems, not passing them on to future generations." Isn't that exactly what the president is doing with the deficit? Me thinks Mr. *'s favorite passtime is passing problems on to future generations.

[schultzee]

15. Duh! People will not have money to buy thier insurance. They

did not stand up to the medicare bill that ripped us off and gave billions to the pharmaceuticals though. Pigs.

[elsur]

17. Just a blanket question and at least try to be civil ....

What's your particular issue with privatized social security? Assuming everyone past a certain age, say 35 or 40, is covered with minimum benefits as they stand today, would you have an issue with privatization for younger workers?

I've had some experience with different levels of privatized retirement and/or social security benefits in South America and am just looking for people's views.

[Bridget Burke]

19. The Republicans want to "privatize" Social Security.

That's enough for me. They want to undo all of FDR's social policies--it's not a secret.

Please, tell us about South America. And how Pinochet was only misunderstood.

[elsur]

20. So that's the extent of the thought you've put into it?

p.s. Pinochet ... though millions still love him ... was a bastard sociopath for what I could gather from talking to folks in Santiago.

[Lerkfish]

29. please DO try to be civil, ok?

follow your own advice, here. You asked for thoughts.

[shrike]

35. A "bastard sociopath" is putting it mildly

Even worse, he was OUR bastard sociopath.

[elsur]

38. Even so the country is pretty evenly split ...

... on whether they like him or not. He lived down the road from me about a 1/2 mile and when he ventured out his security would shut down the streets for his motorcade to travel through Lo Barnachea on the way out of the mountains down to Santiago.

Depending on what neighborhood he was rolling through people would be standing out on the sidewalks cheering him or cussing him.

[shrike]

39. All that proves is that Chileans are like Americans

Half of them are completely deluded. I guess it all depends on whether Pinochet "disappeared" your family or left it alone.

Oh, and Pinochet also came to power by way of an illegal coup ... with our help.

[elsur]

40. no argument from me ..

I was just giving you the consensus of the Chileans. The other factor that pretty much splits support is whether you have money or not. If you're a working slob you're much more likely to despise Pinochet.

[shrike]

44. Sorry if the post was nasty, but Pinochet is one of my pet peeves

Learning about him was a wake-up call for me personally -- I realized finally how dastardly my own government (which I was taught to revere) can be.

[tmooses]

47. That's true-they want a return to the glory days of Herbert Hoover

[Just Me]

21. There are several problems.

First, investing in the stock market has far greater risk involved.

Second, the vast majority of people haven't a clue how that market works and are too busy surviving to learn the intricacies let alone actually spend significant time tracking the market.

Third, many people will spend that money on basics rather than put it into investments they do not understand.

Fourth, this so-called "privatization - ownership" program is really intended to bolster Wall Street and CEOs amounting to funnelling public wealth into a few pockets.

Fifth, Busholini & Co. are adding another two TRILLION for a plan that should cost NO ADDITIONAL MONEY and I must assume they are doing so, once again, to line the pockets of their fat-cat corporatists.

Sixth, there is no evidence whatsoever that those who elect to invest a % will actually recognize ANY benefit (to the contrary, a study has been done indicating that a net loss is suffered by the investor).

Seventh, it leaves AT LEAST 45+ million Americans who are living in poverty in addition to the tens of millions of Americans barely making a living to die.

But, hey,...who cares. We live in capitalistic rat race America now.

[amandabeech]

22. For starters . . .

The stock market goes up and it goes down. Our stock market here crashed 1929-1932 or so and it took 25 years for it to come back to the same level. We also have had nasty dives in 1974-1977 or so, 1987-1992 or so and the most recent dive in 2000-2002, from which the NASDAQ has not even begun to recover, really.

Although over the long run stocks have done well, retirement comes at a very specific time and may or may not last that long. Folks near retirement in 2000 who had most of their investments in tech and other NASDAQ stocks may have their retirement living standard permanently reduced.

Social security is intended as an insurance system that protects people from stock market dives and from their own bad investment decisions by providing a base income on which people are supposed to be able to live.

Additionally, I have read that investment advisors, also known as "Wall Street", will end up with one-third of the money invested in the long run. Wall Street is also the group campaigning the hardest for this change to social security. They can't wait to get their hands on that retirement money.

[Tab]

25. Well...

There's a ton written on this subject. The gov't tries to make it sound like it's just 2% of the money, but what they mean is that SS takes 6% of your income, and this is 2% of that, but not 1/50th, but rather 2 of those 6, or a third of the money.

There are some concerns that it might kill SS, if I understand it correctly, the argument goes something like this:

- Baby boomers have the most wealth right now
- Baby boomers are the largest population in the US right now
- Youngsters aren't finding high-priced jobs waiting for them and even if they had the same, their population size is much reduced, so they're not contributing to SS on the same scale that baby boomers did.
- If baby boomers, with their sheer size and $ put that much money into the stock market, the market would be depressed. Why? Because there's not any equivalent population in terms of people or dollars to buy up the shares.

Alternatively I guess it could be argued that by moving that much money into the stock market, depending on who gets to decide what goes where, they'll opt for "blue chip" stock, rather than take a flyer on some unknown venture, thus boosting the stock price of blue chip Fortune 500 companies. This is good for Big Corporations, but is it good for the economy in general?

I'm not an economist, and apparently even the economists disagree on what the effect would be. One side says that pouring all that money with all those people into the stock market would bloat and kill the market. I'm not sure about that, because with the free market and NASDAQ and personal investing in the 90s, the market soared. On the other hand, the argument that there's no one to buy the shares... not sure how that goes. May be a longer term issue in 20 years (not that it shouldn't be considered) as opposed to, say, tomorrow.

Or, there could be a lot in it for fund managers. Or as I said, big business.

I think, though, the ultimate argument is that it introduces risk into the funds available for the last years of your life, and people don't like screwing around with that; if anything goes wrong, you're too old and too much time has passed to be able to do anything about it.

The current system, remember, wasn't meant to fund your retirement, just to make sure you didn't starve after you retired, and had some security in times of crisis.

I personally think that if you wanted to better fund SS, you should take off the cap (or at least greatly raise it) of what dollars of your income get set aside for SS.

Right now, I think the cap is $85,000 or thereabouts (maybe it's closer to $100,000). What this means is, if you earn more than that, once you blow past the cap, your paychecks are larger because you're not paying Social Security. So if you make, say, $170,000, once you get past June, all your paychecks for the rest of the year are social-security free.

I say we take the cap off entirely. Make $500,000 a year? You should be paying the same percentage of your income as everyone else. However we then have to rejigger the laws to pay them back only up to a payback cap (I'll explain this in a minute).

Basically as it is, the lower income people (under the cap) always pay social security, the upper income (over the cap) don't pay it once they've earned past the cap.

I think the philosophical argument is that the money you pay in goes to your own retirement. Those who make $500,000 only pay SS for the first $85k, but then again, when they retire, they'll only get checks for that $85k of income, not for $500k of income. Imagine the outcry that the $500k people start getting $100k a year from social security. So maybe it gets split so that there's no contribution limit, but there is a payback limit.

Detractors will claim that paying in on all $500k but only collecting on $85k is unfair and socialistic, but I disagree. You pay income taxes on all $500k (or you should) but you don't necessarily get that all back - that money goes to help someone else (like the Iraqis).

I would also argue that if there was no donate cap, but there was a reception cap, that everyone's SS taxes would actually go down.

Of course, everyone fighting for tax cuts right now are not going to stand for a no-cap on SS contributions, so it's not an easy sell, but it may be necessary.

[bemildred]

26. I want everybody covered, mainly.

At a decent level.
Otherwise I could care a fig how they finance it, as long as the
method works and adapts to the need.

[Lerkfish]

27. LOL! "at least try to be civil"....

oh, that's rich.

anyhow. here's the deal: privatizing social security SOUNDS good until you really think about it: the machinery of social security works thusly: all your life you are taxed for social security. What you pay goes to help those who need it NOW. when you retire, others will pay for YOU. Its a revolving door that works as long as its revolving.

What happens when you privatize, is that you do several bad things simultaneously.

1. you are no longer taking care of the people that need help NOW. Screw them, I guess. they're not making NEW money, so they can't privately invest money they don't have.

2. Privatizing means the individual pays TAXES on the investments they make. Remember, this is ALREADY a tax. Its TAXING a TAX.

3. Privatizing means the individuals shoulders the RISK of the investment. Neal Bush ring any bells? So, you've invested in a savings and loan. It goes bankrupt. There goes your money. Who bails you out? NO ONE. Who makes sure you don't starve when that happens? NO ONE.

4. Who benefits from privatizing social security? follow the money. you're talking billions if not trillions of dollars...so....who benefits? Why, corporations because you invest in them. Why, stock brokerage firms who charge fees to manage the accounts. Why, The government because it no longer has to administer the funds nor protect the citizens in case 'SOMETHING GOES WRONG'.

What could go wrong, you ask? What happened to the stock market when the dotcom bubble collapsed? Did people lose money? why, I believe they did.

Look at 401K plans....at the beginning of Bush's first term, both me and my employer were shoveling in 6% of my salary. Sure, I got to defer the taxes...but what happened to my investment? In one year, the fund dropped thousands, WHILE I WAS STILL FUNNELLING MONEY INTO IT. Even continued contributions could not stem the hemmoraging.
Even if I had just used a regular bank account, I would not have LOST MONEY. That is an example of a privatized solution that employs money market funds and the stock market to fund my retirement.

[Mountainman]

28. A rule of thumb, when Republicans do something it is not in the best

interests of the majority of people. This privatization is a money maker for Wall Street traders. If is was a good idea it would have happened before. If you lose your money in the market you will not get it back but the traders will have made their money. Most people are not sophisticated to handle trades. and the beat goes on.

[SeekerofTruth]

30. Privatizing would be great, but many people are afraid of change.

I assume your reference to experience with benefits in South America would include Chile's privatized retirement system. They had our type of SS until 20 years ago when it was going bankrupt. Now, more people are covered and receive more amounts of money during their retirement years than under the old 'government' only program.

Many of Bush's plans are directly taken from Chile's system. Sadly, because Bush is an idiot, many people are blinded by their hatred for him. They assume the worst. Instead, they need to make sure that the SS system he proposes actually follows a successful program like Chile.

[Just Me]

31. Change for the better is GREAT!!! The change pushed by neocons

is just plain cruel since it advances the fortunate and leaves everyone else in crushing poverty. The neocons' plan ignores human reality and actually creates a form of corporate communism. It's sick and unAmerican.

[elsur]

32. Yes I was referring to Chile but Argentina also has a pseudo-

private SS system.

When I worked in Chile I had about 300 employees. Some were quite highly paid while others barely made anything. The Chilean system has a few drawbacks but nothing like what I see now in the US.

One advanatage to the Chilean system vs. pure privatization is that there is always a welfare type safety net for those who don't make enough to contribute or for those who have a horrible run in life. Withdrawals after retirement are limited so that even the dimmest can't really screw themselves by depleting their account too soon. Investments are strictly limited by option type because you have to go to one of a few sanctioned investment houses who exist solely for the purpose of investing and distributing retirement benefits. No ability to invest your entire bankroll into the next Enron.

Like I said there are downsides but anybody, like AARP, who argues that we are guaranteed something with the current system hasn't looked at it real closely. The Social Security Administration guarantees nothing.

[VegasWolf]

34. For me SS taxes were a small amount of my income, they stop

taxing after about 70K. The government already gives
tax breaks on 401K programs and other investments. If one is
making say 30K, it is pretty risky to put much of your
retirement in the market, especially if you are naive about
mutual funds and fund managers. It's not just bush that
is stupid, but it's also his economic team with
for a weak dollar philosophy, outsourcing manufacturing
jobs, picking trade wars with China, etc.

[shrike]

37. A little reality here ...

A. Social Security is not in imminent danger of going bankrupt.

B. SS is not a pay-as-you-go system. Thus, the diversion of new funds into private accounts would leave the fund for current retirees with a $2 trillion shortfall (There has been a lot of news stories about this; look it up.)

C. There have been two suggestions so far for "shoring up" this shortfall. One, the federal government would "borrow" to cover it; just what we need. Two, they would divert a certain portion of monies made through "private accounts" (assuming they actually make money) to make up the shortfall -- though some experts insist those monies will not be enough. Third, they could cut benefits, a very popular option, I'm sure.

D. So Chile, land of Pinochet, is now our economic model. God, are we in trouble.

[tx_dem41]

43. Your point C shows how ridiculous this issue is....

Borrow to cover it....20% mortgage rates (at least?) here we come!

Diversion of profits from private accounts....jeez, that sounds like the system we have now. Guess, it shows how "not private" these "private" accounts would be.

Cut benefits .....My generation has been paying (overpaying?) into a program that has been running a surplus for years and years. Why should my benefits be cut?

[BiggJawn]

33. What works in south america may not work here.

I have a HUGE distrust of Privatization, since I used to see it up close and personal when I worked for Steve Goldsmith, former Mayor of Indianapolis and High Priest of Privatization.

It's a scam foisted upon the people. In the version I experienced, the mantra was that Government services could ALWAYS be provided better and cheaper when private companies were contracted to provide them.

City agencies who did their homework (like mine) held off the attacks and showed how much we actually SAVED the taxpayers by removing the Need to Make a Profit from the mix. Agencies who stuck their heads up their asses (like IT) got sold to the lowest estimator, who then proved to be incapable of saying anything besides "Oops! Cost over-run...Please Sir, may we have some MORE money???"

How does this tie into privatizing our Socal Security? Easy, NOTHING is done in the private sector in this country unless there's promise of a FAT return. What I think is going on is that Shrub's buddies in the financial sector are just waiting to get us all to invest our SS money into their schemes, then...
"Whoops! Sorry, All Gone! Well, if you had read the small print in the prospectus, you'd had known this might have happened, so shut up and go get a McJob now...."

But I think the young folks would go for this if it was marketed as "hip" and "edgey", with the "Posibility of HUGE returns on your investments!"

[tx_dem41]

41. Another good reason is that I have been overpaying into the system

for the last 25 years (remember SS is running up a BIG surplus and has been for 15 years). But, now you want to pay me "minimum benefits" while you opt out of your turn to participate in the system. Did you really mean "minimum" benefits?? Why should I get minimum benefits when I have been overpaying into a system that is running a huge surplus that has been fritterered away to a small portion of people through tax cuts?

Also, the system is not truly "privatized". Truly privatized would mean that they either lower the FICA rate or eliminate it all together and let YOU invest it. This, in a sense, is a very controlled and forced privatization where the money will be channeled to the "right" people on Wall Street.

[demigoddess]

46. My problem with privatization is that people will spend or

lose it or borrow against it and not have anything in the end. I know lots of people with jobs who spend every dollar that comes in their hands and not because they have to. But because they shop continually. Then they complain, and they are repubs.
SS was meant to be a last ditch safety net for unlucky people who lost due to circumstances like that. Even now you can borrow against your IRA or lose it all to Enron. etc. which is a drain on society. SS has helped bring a lot of people a better life and kept us from having homeless and desperate people all over the place.

[KennedyGuy]

36. Well thats what they get for embracing Chimpy

in the past. Oh, it was all the rage when the repukes trumpeted the aarp support of the perscription drug plan. They helped re-elect this clown and now he has turned on them Big suprise.

[SteveG]

42. After screwing up on the Prescription Drug plan

and taking a large hit by their rank and file, maybe they have learned their lesson, and realize that their base opposes turning social security over to Wall Street.

[0007]

45. FUCK YOU AARP! Never again will I buy into your bullshit -

[Chicago Democrat]

48. Yay!

Might actually kill it.