I recently visited our local Soc Sec building. Normally about six people man the office. At the touch screen kiosk I entered my info and marked my question as "other". I sat in the lobby for an expected one hour wait.
In less than ten minutes my phone rang. A woman explained she was working remotely at home to support the in-house staff and noticed I had marked "other" as my issue. She detailed the steps and documents I had to prepare. In minutes I had my info and was on my way. I was pleased with my government's efficiency.
I DO NOT MEAN TO STEP ON YOUR MESSAGE. I agree that DOGE is the greatest danger SS has faced in my lifetime. we can fix the damage from the Fairness Act, or the failure to raise the tax before the Trust Fund runs out. But people will die if their benefits don't come out on time. And there is, besides the deaths, a good chance that we can never repair what Trump/Doge are doing to this country.
Meanwhile it does no good to talk about Social Security if people don't understand how it works.
The concept of the Social Security Trust fund is a fraud. The government is constantly changing benefit rules while trying to maintain the facade that people get back based on what they pay in.
The GPO is a perfect example.
If government was honest they would drop the pretense. Then let fully informed voters vote on candidates based on an honest accounting of this tax and benefit program.
you are dead wrong about this. the Trust Fund is real. It started out to be just an ordinary buffer between temporary mismatch between money in and money out. After the 1983 fix it was expanded to build a much larger fund to enable the boomer generation to pay in advance for its own retirement..larger numbers than thr following genration...so that following genertion would not be unfairly burdened by paying for the larger boomer generation. That larger Fund is now paying for the Boomer retirement as planned. But because Congress has refused to raise the payroll tax...abour a dollar per week per year...to keep up with longer life expectancies...when the Trust Fund "runs out" the ta rae will not be enough to pay for those loner life expectanies. The honest and fair solution is to just start raising the payroll tax that one dollar per week.
If you ever see a fully informed voter ...it won't be you...call your local newspaper.
Social SEcurty is the most honest program any government has ever come up with. That's why the rich hate it.
The "fairness act" was actually a Trojan horse to cut Social Security while pretending to increase benefits...for people who didn't need it and didn't pay for it. The fact that it was bipartisan scares me. it means the Congress...both parties...either do not understand how SS works, or are in cahoots to destroy it.
The Trust Fund is atuarily sound. But it cannot pay for all future benefits if the payroll tax is not increased..one dollar per week per year will make it actuarily sound essentially forever. You would need to be able to read the Trustees Report carefully and do a little math to understand this.
Not saying this to insult you: but you actually need to understand what you are talking about and not just throw words around that the enemies of Social Security have taught you to parrot.
What do you think "actuarily sound" means? that it can pay out forever with no increase in income? That would be fine if there was a bank we could just put twenty trillion dollars into and then live off the interest over the infinite horizon. But we can't. We CAN pay for our daily bread one day at a time. And as long as the country lasts, we can do that "in advance" (actuarily?) through the magic of pay as you go financing. Future workers will need Social Security just as much as we do, an by paying for their own future benefits they provide the cash to supply the needs of beneficiaries who paid for their benefits while they were still working. I'd like to say "think about it." But I have learned from experience that almost no one ever does. [the cash that comes from ten percent of a persons income today has more buying power that the cash that the worker paid in in taxes years ago at the same percent of his income...that is where "interest" comes from. Meanwhile increase in life expectency mean that the workers will need to raise the percent of their income..one dollar per week per year...in order to have enough to live on when they can no longer work. But since they will have higher incomes due to the growth in the economy, they will not have to live on less in order to pay the higher taxes. Try to think it through.
I usd to teach math to college students. I broke my heart trying to teach them by "explaining" it. Fact is they can't learn it until they learn to think about it themselves. A little help and encouragement from the teacher will save them some time, but at the end of the day they have to think about it themselves.
To me, the tax on each birth year should be adequate to pay all benefits to that birth year. Saying the trust fund can't pay projected benefits without a tax increase is exactly the point. You would have understood if you read my first paragraph.
This is why adding beneficiaries after the vast majority of the insurance premia are collected, like GPO, which benefits people who did not contribute for a portion of their working life, but now get the benefits as if they had, is borderline fraud by the government. Perhaps fraud on future taxpayers, rather than on current recipients, but shady to say the least.
man up. my "ad hominems" don't hurt you. they just tell you what i think.
do you want me to be a smarmy businessman and flatter you while i pick your pocket? i once had a worker who said my plan for a project was stupid. I said "what would you do?" He told me, and I said he was right and put him in charge of it. Amazing what you can do if you can keep track of the argument and not crybaby about "ad hominem."
btw. i did read your first paragraph. i would have understood it if you had written it better. your second try was worse. why do you think a fund is unsound if after it has done the work it was designed to do, it would need a higher income source to accomplish the next thing you want to do? try to think about the reality here and not just the words you throw around without knowing anything about the facts that matter.
it is fraud on current beneficiaries. cheating them out of six months of benefits they paid for.
from time to time the tax needs to be increased to pay for changing circumstances. killing the WEP was not a changing circumstance. it was a deliberate attack on Social Security by a bipartisan congress that is either stupid or dishonest.
Social Security is the best palliative we've ever passed, and I'm all for continuing it as an adjunct policy to the actual solution to the seeming unresolvability of our long term monetary and economic problems. That solution is the several policies I've posted here for some time.
All new money is created by the accounting operation of equal debits and credits that sum to zero. Thus, if you passed a law that retailers could "opt" into where they gave the consumer a general 50% discount (credit) the government/money system would rebate (debit) the entire amount of that discount back to them. This means the individual can get $100 worth of grocreies for $50, a $60k EV for $30k and a $500k house for $250k. In other words their purchasing power is mathematically doubled, chronic erosive inflation is transformed into beneficial price and asset deflation and of course the demand for every retailer's goods and services is potentially doubled which integrates the normally subtlely contentious self interests of consumer and merchant.
Repeat this operation at point of loan signing and those big ticket items are reduced by another 50% which reduces the rate of flow of private debt increase (which is the real debt problem NOT government "debt") by 75%.
I know better than to try to answer you. But in case anyone else is listening I do not understand what you are saying. I think no one else will either.
No, its much more straight forward framing for demonstrating a solution to the problem that MMTers want to enlighten because it awakens the observer to the efficacy of strategic implementation of Monetary Gifting...than MMTers are trying to do, which is still using wordage like "debt" and "deficits" to describe "payments to the private sector". Finally, the policies demonstrate a huge short coming in macro-economics which is abstracting out the individual...by demonstrating the DIRECT beneficial effects of the policies for both the individual and commercial agents of monetary policy at retail sale and point of loan signing. BUT YOU HAVE TO ACTUALLY LOOK AT THE POLICIES' EFFECTS instead of not looking or reacting with some abstract orthodoxy that says you shouldn't look, but simply reject.
Okay, you propose something called "monetary gifting." But the florid terminology with which you present it is off-putting. "efficacy of the strategic implementation..." I'd bet that might be interesting were it rendered in ordinary English. Using academic style language may make an argument seem more forceful, but it also sounds like class bullying to us mere blue collar workers. Not the same as a discussion among specialists in a discipline like economics or botany or whatever where insider vocabulary is used. The point here is to convince us lessers.
I mean what Kelton presents is clear. I think Hummel is attempting to take a step further, but it's hard to decode his baroque phrasing. Frankly, when I see such, I suspect an attempt to conceal something from us peasants. If he wants to convince us, then let him present his case clearly and concisely. TBH, it sounds like those bizspeak random jargon generators.
I don't either. It sounds more along UBI lines to me. I don't know of any MMT economist who think UBI is a good idea, for good reason. There is little doubt that UBI would be highly inflationary (corporate welfare). I do not see how that plan would be any different.
If you can't understand that you can go to the grocery store and get $100 worth of groceries for only $50 or a $60k Tesla for only $30k...then you're just not looking at what the policies accomplish. LOOK AT IT.
And it utilizes the exact same means of money creation the banks use to create money (equal debits and credits that sum to zero) except its a GIFT instead of a debt as in a loan or as a burden to (fully) pay. PLEASE, FINALLY LOOK AT IT.
Oh come on coberly. You taught math but you can't apply a freshman algebra equation of -$5 discount on a $10 purchase + $5 rebated back to the merchant = $0 because the merchant got their full price and yet the consumer only paid $5 meaning their purchasing power just got doubled and the consumer's understandable recent and 6000 year long bitch about inflation just got solved by beneficial price deflation.
Claim the private sector does everything better than the public sector --> Defund useful public sector institutions until they perform poorly --> Use poor public sector performance as an excuse to continue cutting the public sector --> Convince voters to transfer responsibility of the public sector to the private sector.
It's been the Republican playbook for nearly a century. The private sector doesn't do public service, let's just be clear. There are things it's excels at and service isn't one of them.
yes. privatization is just a cheap way to "save taxpayer money" by reducing the wages of workers. who, having less money will pay less taxes and buy less things, thus defeating the "saving" money idea...which is always what happens when governments and business try to save money by cheating its workers.
"Claim." Libertarians simply assert success is individual effort alone, defining away both structural inequities and the reality that nature is predominantly cooperative, symbiotic. So are human organizations; contrary to their fervent beliefs, no boss or owner does everything solo. They just consider themselves Social Darwinist winners with a divine right to rule.
If the system were so perfect, why 1929, the S & L crisis, 2008, etc? Why, when you really examine the theoretical underpinnings of this idealized econ determinism, do they prove so elusive and insubstantial?
Many of us blue collar workers realize the system is a scam. After the '08 crash, corporations were bailed out. For the millions among the majority working class who lost jobs, pensions, houses? Nothing! Many of us are still hurting. Why would we want this same bunch of sleazy manipulators to handle Social Security?
Years ago, when my now ex-husband had taken out a big chunk of his IRA to do he couldn't say what with, he pushed our income into bigger Medicare withholding, which was one of the reasons I divorced him. I visited the local social security office and after a half hour wait talked with a kind if harried employee about what if anything I could do to mitigate his actions. They were able to fix this for me, due to some arcane rule about divorce pending.
After the stupid and vengeful action of this stupid and vengeful "man" pretending to be president, I'm sure this just won't be available to people.
"believing reality TV" I presume you mean Trump voters. How about some context? In the late '70s, the D party was usurped by neolibs, supporters of econopathic trickle-up. They ditched the New Deal and abandoned the majority working class.
The Ds did FOR the suffering unemployed of the Rust Belt/Appalachia same as they did TO the Wall St. vultures who caused the '08 crash--NOTHING! Corporations were bailed out. What help was there for the millions of workers who lost jobs, pensions, homes? NONE! Many of us are still hurting. No coincidence the RB/A area now leads in what are called 'deaths of despair.'
After 40 years of neglect by the party that was once ours, what would you do? Corporate lite Ds aren't much of an alternative. And why do you think there are so many non-voters? Since the neither of the two major parties seems to listen, it's a way of saying NO.
You can thank the elite of the D party for this disaster. Their attitude revealed in 2016 by Sen. Chuck Schumer who said the quiet part out loud. "For every blue collar vote we lose in western Pennsylvania, we will pick up two moderate Republicans in the suburbs of Philadelphia, and you can repeat that in Ohio and Illinois and Wisconsin." (//The Deficit Myth// Kelton, p. 130) Not only morally reprehensible, but stupid politically.
Exactly. Both parties have played too many games with our lives for so long. They ALWAYS tell us what we want to hear using false, empty hopes & promises along with virtue signaling in order to get our votes, especially Democrats. The Democrat party in general had made me an Anarchist three years ago. I'm over them & their performative, political theaters.
All of these politicians are so corrupt & are bought & paid for by their wealthy elite donors, lobbyists, corporate interests, Israel & the Israeli lobby (such as AIPAC), & by globalists to do their bidding. They're NOT for us & WILL NEVER BE for us.
you are wrong. borrowing from Trust Funds is what all Trust Funds do. They don't keep the money in a safe. they lend it out at interest. The Trust Fund has not been stolen. You are believing in a lie by the people who hate any kind of security for the poor. Their aim is to make you think SS is cheating you so you will stand by while they kill it.
Wow, aren’t you full of assumptions? Do you know what they say about assumptions right? I’m on Social Security and Medicare and have been for 12 years. Both of my parents are as well! So ASSuming that I have any negative feelings whatsoever towards Social Security truly just says a whole lot about you!!!
this was in my inbox, but i could not find it on the thread. maybe it was the "comment deleted"
Wow, aren’t you full of assumptions? Do you know what they say about assumptions right? I’m on Social Security and Medicare and have been for 12 years. Both of my parents are as well! So AS..ming that I have any negative feelings whatsoever towards Social Security truly just says a whole lot about you!!!
what assmptions are you assuming i am assuming. i try to be very careful with my facts and constantly check myself for hidden assumptions. I do not see that I assumed you had any negative feelings about SS. But you are wrong if you think that borrowing from the Trust Fund has hurt SS.
i think your comment may have been deleted by a robot that things you were using a bad word..so to avoid getting deleted myself i disguised your work a bit because it is no use arguing with a robot.
Kelton's article explains the shortfall is due to most gains on income going to people above the $168,000 cutoff and therefore most income gains aren't taxed for Soc Sec. The cap needs to be raised significantly to tax this income or incomes of working people subject to Soc Sec tax need to increase.
This is wrong. The people above the cutoff do not pay tax on the money above the cutoff, but they receive no benefits from SS above that cutoff. Meanwhile it is the money that they DO pay into SS that provides the extra money needed for SS to pay the very poor who could not save enough for retirement enough to keep them out of the worst poverty. I think you must have misunderstlld Kelton, or she does not understand SS herself.
or i may have misunderstood you. yes the most gains IN income have gone to the richest. but that has nothing to do with Social Security except it encourages some people to think the answer to the projected shortfall is to tax the rich. the rich are already paying for their own benefits...and because SS is insurance..the larger amount they pay on their income below the cap is what enables SS to pay more to you and especially to the poorest workers.
you can fix SS forever by raising your own payroll tax about onedollar per week per year...or you can wave signs"demanding" the rich pay for SS. Roosevelt knew that making the rich pay would mean they would kill SS.
Actually, Congress need only pass a law that any SS shortfall must be covered from the General Fund. Medicare Parts B and D are paid by the General Fund. Moving retirement again from 67 to 70 should never happen.
raising the retirement age should never happen. but paying for it out of the general fund is exactly what Roosevelt warned against it. If the rich pay for it they will kill it.
Part B is paid for by SS recipients..which is dumb. If they wanted workers to pay for Medicare ("Part B") they should have applied the tax to those workers while they still had jobs. would have been less per month and taken advantage of the "time value of money"...that is the percent of income needed would be the same over time as incomes rose due to both inflation and the growth of the economy.
"Congress need only pass a law..." Ideally yes, but I agree with you and FDR. Especially given the current reality of both major parties being corporate and 1%er sponsored.
I've never come across what you said about Medicare. The union made light bulb above my head just lit up--you're right! (And obviously, you can do math.)
because it is paying down the reserve it created to fund theBoomer generation. but congress has not increased the payroll tax to cover the longer life expectancy of the following generation. even though the tax increase needed would only be about one dollar per week per year. and even the Left is so stupid it goes along with this by demanding the rich pay for Social Security. the rich will NOT pay for Social Security. They woud rather you work until you drop. and they have the power.
why was common deleted?.: trust fun is "short of funds" because it is paying out the money it was designed to pay out to cover the boomer retirement. meanwhile the payroll tax has not been raised enough to cover the cost of increasing life expectancy. this cost would amount to about one dollar per week per year for the average worker.
this comment was written when "comment deleted" appeared where i expected to see my comment. looks like it may have been another comment. so you get to read mine twice. much better.
"I wonder who voters will call when there is no one to answer the switchboard..."
Exactly. The private sector concentrates on efficiency and will cut the service sections of their business until customers complain. But government answers to the American people, and so serving the public is the paramount concern--not cutthroat efficiency. And because the Social Security Administration doesn't have any competitors, it can afford to tolerate some level of inefficiency if the public is better served in the process.
Remember, a private firm has no duty to employ Americans. And when a private firm cuts a paycheck, all of that money is gone. That's why a private firm is so intent on making sure that every paycheck issued is justified. But the government claws back a portion of the paychecks it issues through taxes. The government can actually afford inefficiency if it serves the public and, in the process, provides gainful employment to its citizens. The private sector and the government dance to different drummers.
It seems pretty clear to me that Elon Musk does not understand this distinction.
or he is lying about it. false efficiency always makes for worse results..which appears to be what Musk wants.
You (Grigo] are absolutely right about the difference between government spending and privare spending. if nothing else, the government needs to feed the people during a recession so there will be workers in the future when "the economy"improves, not to mention soldiers to defend the rich when the enemy storms the gates.
i don't think "claws back" is the best phrase to use describing the feedback between government spending and taxes. Kelton has a much better understanding of this...but the problem is not so much explaining it as it is getting the Congress to give up a lie about "deficits" that they find very useful.
first,SS is NOT a Ponzi scheme. but neither is DOGE. Doge is rape and pillaging of a fallen city by conquerers. It is astoundiug how ignorant he is..unless he is just lying because he knows he can get away with it since the people are ignorant of how the economy and SS work.
you need to keep up. I have been studying SS for nearly twenty years. BOTH parties have been proposing cuts to SS..."in order to save it." I don'tknow if the Dems are complicit or stupid, but the real tries to cut SS come from the Republicans...except the occasional Obama commission. Meanwhile the Fairness Act has actually succeeded in cutting Social SEcurity and it was bipartisan.
btw I have talked to thousands of people trying to get them to understand SS. what I have found...I think I read this in Kelton's book: "it is easier to fool people than it is to get them to admit they have been fooled."
I am keeping up. The Democrat Party has been trying this same old, tired stunt for fifty years. The voters have grown weary of the boy who cried ‘wolf’.
you only think you have been keeping up. the congress has stopped the assaults on SS because there contituents made them understand they would lose their jobs if they didn't. but you can believe whatever you want. thetragedy is that too many people think like you do. i amfairly sure their strategy now is to let what Musk does to SS kill SS. otherwise we are close enough to Trust Fund Zero that SS will die on its own without anyone's fingerprints on it.
be intersting to see how that works out. one thing Kelton left out of her book..as far as i have gotten in my seond reading...is that while Greece gave up its sovereign currency and got in trouble when it could not pay back its loans is that the EU could have "printed" the money Greece needed to keep its economy from "austerity". it was largely the Germans who prevented this.
I just had my “windfall” restored. After first saying it could take a year or more they automated the process and a year’s retro benefit appeared in my bank account.
My regular payment is due later this month so we’ll see.
A 2001 Grover Norquist quote keeps coming to mind: "I don't want to abolish government. I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub."
We are now being dragged into the bathroom and drowned.
Allow me to draw your attention to people who understand - better than I - how SSI works.
"MEMORANDUM ON CONFERENCE WITH FDR CONCERNING SOCIAL SECURITY TAXATION, SUMMER, 1941 (excerpt) In the course of this discussion I raised the question of the ultimate abandonment the pay roll taxes in connection with old age security and unemployment relief in the event of another period of depression. I suggested that it had been a mistake to levy these taxes in the 1930’s when the social security program was originally adopted. FDR said, “I guess you’re right on the economics. They are politics all the way through. We put those pay roll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program. Those taxes aren’t a matter of economics, they’re straight politics.” FDR also mentioned the psychological effect of contributions in destroying the “relief attitude.”
2. James K. Galbraith, In Defense of Deficits, March 4, 2010
“What is true of government as a whole is also true of particular programs. Social Security and Medicare are government programs; they cannot go bankrupt, and they cannot fail to meet their obligations unless Congress decides–say on the recommendation of the Simpson-Bowles Commission–to cut the benefits they provide.
The exercise of linking future benefits and projected payroll tax revenues is an accounting farce, done for political reasons. That farce was started by FDR as a way of protecting Social Security from cuts. But it has become a way of creating needless anxiety about these programs and of precluding sensible reforms, like expanding Medicare to those 55 and older, or even to the whole population.”
3.Robert Eisner, Save Social Security from its Saviors, Journal of Post Keynesian Economics, 1998
"Social Security faces no crisis now or in the future. It will not "go bankrupt." It will "be there," not only for those of us now enjoying it of looking forward to it in the near future, but for the baby boomers and the "Generation Xers" following them. All this is true as long as those who would nibble away at Social Security or destroy it in the name of "privatization" do not have their political way. But they very likely will not, since the elderly--and their children--vote, and will vote sensibbly as the full implications of the issue become apparent.
The dangers
The proposed nibbling away of Social Security, including that by some of its presumed friends, is disingenuous and misleading. Even some of its defenders seem all too ready to accept "minor" cuts in benefits to achieve prospective fund balance.
Raising "the retirement age"
One of the more insidious and drastic "solutions" is to increase further the "Normal Retirement Age" or "NRA" of 65, already slated to rise gradually in future years to 67. Actually this had nothing to do with encouraging people to work longer ..."
I recently visited our local Soc Sec building. Normally about six people man the office. At the touch screen kiosk I entered my info and marked my question as "other". I sat in the lobby for an expected one hour wait.
In less than ten minutes my phone rang. A woman explained she was working remotely at home to support the in-house staff and noticed I had marked "other" as my issue. She detailed the steps and documents I had to prepare. In minutes I had my info and was on my way. I was pleased with my government's efficiency.
She's probably been fired in the past two weeks.
I’d suggest:
• White House Switchboard: 1-202-456-1414
• White House Comments Line: 1-202-456-1111
• U.S. Capitol Switchboard: 1-202-224-3121
Or a recording:
“ Press 1 to reach the White House. Press 2 to leave a comment for President Trump or DOGE. Press 3 to reach your local congressperson.”
Stephanie
I DO NOT MEAN TO STEP ON YOUR MESSAGE. I agree that DOGE is the greatest danger SS has faced in my lifetime. we can fix the damage from the Fairness Act, or the failure to raise the tax before the Trust Fund runs out. But people will die if their benefits don't come out on time. And there is, besides the deaths, a good chance that we can never repair what Trump/Doge are doing to this country.
Meanwhile it does no good to talk about Social Security if people don't understand how it works.
The concept of the Social Security Trust fund is a fraud. The government is constantly changing benefit rules while trying to maintain the facade that people get back based on what they pay in.
The GPO is a perfect example.
If government was honest they would drop the pretense. Then let fully informed voters vote on candidates based on an honest accounting of this tax and benefit program.
Jim Miller
you are dead wrong about this. the Trust Fund is real. It started out to be just an ordinary buffer between temporary mismatch between money in and money out. After the 1983 fix it was expanded to build a much larger fund to enable the boomer generation to pay in advance for its own retirement..larger numbers than thr following genration...so that following genertion would not be unfairly burdened by paying for the larger boomer generation. That larger Fund is now paying for the Boomer retirement as planned. But because Congress has refused to raise the payroll tax...abour a dollar per week per year...to keep up with longer life expectancies...when the Trust Fund "runs out" the ta rae will not be enough to pay for those loner life expectanies. The honest and fair solution is to just start raising the payroll tax that one dollar per week.
If you ever see a fully informed voter ...it won't be you...call your local newspaper.
Social SEcurty is the most honest program any government has ever come up with. That's why the rich hate it.
The "fairness act" was actually a Trojan horse to cut Social Security while pretending to increase benefits...for people who didn't need it and didn't pay for it. The fact that it was bipartisan scares me. it means the Congress...both parties...either do not understand how SS works, or are in cahoots to destroy it.
You just echoed my point - the Trust Fund is not actuarily sound. How is that an honest program?
https://www.ssa.gov/oact/TRSUM/
The Trust Fund is atuarily sound. But it cannot pay for all future benefits if the payroll tax is not increased..one dollar per week per year will make it actuarily sound essentially forever. You would need to be able to read the Trustees Report carefully and do a little math to understand this.
Not saying this to insult you: but you actually need to understand what you are talking about and not just throw words around that the enemies of Social Security have taught you to parrot.
What do you think "actuarily sound" means? that it can pay out forever with no increase in income? That would be fine if there was a bank we could just put twenty trillion dollars into and then live off the interest over the infinite horizon. But we can't. We CAN pay for our daily bread one day at a time. And as long as the country lasts, we can do that "in advance" (actuarily?) through the magic of pay as you go financing. Future workers will need Social Security just as much as we do, an by paying for their own future benefits they provide the cash to supply the needs of beneficiaries who paid for their benefits while they were still working. I'd like to say "think about it." But I have learned from experience that almost no one ever does. [the cash that comes from ten percent of a persons income today has more buying power that the cash that the worker paid in in taxes years ago at the same percent of his income...that is where "interest" comes from. Meanwhile increase in life expectency mean that the workers will need to raise the percent of their income..one dollar per week per year...in order to have enough to live on when they can no longer work. But since they will have higher incomes due to the growth in the economy, they will not have to live on less in order to pay the higher taxes. Try to think it through.
I usd to teach math to college students. I broke my heart trying to teach them by "explaining" it. Fact is they can't learn it until they learn to think about it themselves. A little help and encouragement from the teacher will save them some time, but at the end of the day they have to think about it themselves.
Thank you for your multiple ad hominem attacks.
To me, the tax on each birth year should be adequate to pay all benefits to that birth year. Saying the trust fund can't pay projected benefits without a tax increase is exactly the point. You would have understood if you read my first paragraph.
This is why adding beneficiaries after the vast majority of the insurance premia are collected, like GPO, which benefits people who did not contribute for a portion of their working life, but now get the benefits as if they had, is borderline fraud by the government. Perhaps fraud on future taxpayers, rather than on current recipients, but shady to say the least.
miller
man up. my "ad hominems" don't hurt you. they just tell you what i think.
do you want me to be a smarmy businessman and flatter you while i pick your pocket? i once had a worker who said my plan for a project was stupid. I said "what would you do?" He told me, and I said he was right and put him in charge of it. Amazing what you can do if you can keep track of the argument and not crybaby about "ad hominem."
btw. i did read your first paragraph. i would have understood it if you had written it better. your second try was worse. why do you think a fund is unsound if after it has done the work it was designed to do, it would need a higher income source to accomplish the next thing you want to do? try to think about the reality here and not just the words you throw around without knowing anything about the facts that matter.
it is fraud on current beneficiaries. cheating them out of six months of benefits they paid for.
from time to time the tax needs to be increased to pay for changing circumstances. killing the WEP was not a changing circumstance. it was a deliberate attack on Social Security by a bipartisan congress that is either stupid or dishonest.
Social Security is the best palliative we've ever passed, and I'm all for continuing it as an adjunct policy to the actual solution to the seeming unresolvability of our long term monetary and economic problems. That solution is the several policies I've posted here for some time.
All new money is created by the accounting operation of equal debits and credits that sum to zero. Thus, if you passed a law that retailers could "opt" into where they gave the consumer a general 50% discount (credit) the government/money system would rebate (debit) the entire amount of that discount back to them. This means the individual can get $100 worth of grocreies for $50, a $60k EV for $30k and a $500k house for $250k. In other words their purchasing power is mathematically doubled, chronic erosive inflation is transformed into beneficial price and asset deflation and of course the demand for every retailer's goods and services is potentially doubled which integrates the normally subtlely contentious self interests of consumer and merchant.
Repeat this operation at point of loan signing and those big ticket items are reduced by another 50% which reduces the rate of flow of private debt increase (which is the real debt problem NOT government "debt") by 75%.
Steve
I know better than to try to answer you. But in case anyone else is listening I do not understand what you are saying. I think no one else will either.
IMHO it's a convoluted version of what's presented quite clearly by the basic examples in Dr. Kelton's //The Deficit Myth.//
No, its much more straight forward framing for demonstrating a solution to the problem that MMTers want to enlighten because it awakens the observer to the efficacy of strategic implementation of Monetary Gifting...than MMTers are trying to do, which is still using wordage like "debt" and "deficits" to describe "payments to the private sector". Finally, the policies demonstrate a huge short coming in macro-economics which is abstracting out the individual...by demonstrating the DIRECT beneficial effects of the policies for both the individual and commercial agents of monetary policy at retail sale and point of loan signing. BUT YOU HAVE TO ACTUALLY LOOK AT THE POLICIES' EFFECTS instead of not looking or reacting with some abstract orthodoxy that says you shouldn't look, but simply reject.
Okay, you propose something called "monetary gifting." But the florid terminology with which you present it is off-putting. "efficacy of the strategic implementation..." I'd bet that might be interesting were it rendered in ordinary English. Using academic style language may make an argument seem more forceful, but it also sounds like class bullying to us mere blue collar workers. Not the same as a discussion among specialists in a discipline like economics or botany or whatever where insider vocabulary is used. The point here is to convince us lessers.
Rafi
i don't know about "quite clearly" but i am studying Kelton's book. studying. i don't see anything so far that resembles Hummels plan.
perhaps you can explain it?
I mean what Kelton presents is clear. I think Hummel is attempting to take a step further, but it's hard to decode his baroque phrasing. Frankly, when I see such, I suspect an attempt to conceal something from us peasants. If he wants to convince us, then let him present his case clearly and concisely. TBH, it sounds like those bizspeak random jargon generators.
I don't either. It sounds more along UBI lines to me. I don't know of any MMT economist who think UBI is a good idea, for good reason. There is little doubt that UBI would be highly inflationary (corporate welfare). I do not see how that plan would be any different.
If you can't understand that you can go to the grocery store and get $100 worth of groceries for only $50 or a $60k Tesla for only $30k...then you're just not looking at what the policies accomplish. LOOK AT IT.
And it utilizes the exact same means of money creation the banks use to create money (equal debits and credits that sum to zero) except its a GIFT instead of a debt as in a loan or as a burden to (fully) pay. PLEASE, FINALLY LOOK AT IT.
i did. could not make sense out of it.
Oh come on coberly. You taught math but you can't apply a freshman algebra equation of -$5 discount on a $10 purchase + $5 rebated back to the merchant = $0 because the merchant got their full price and yet the consumer only paid $5 meaning their purchasing power just got doubled and the consumer's understandable recent and 6000 year long bitch about inflation just got solved by beneficial price deflation.
Now I really am suspicious given the insulting, talk down to type reply to you.
This feels like the classic libertarian playbook:
Claim the private sector does everything better than the public sector --> Defund useful public sector institutions until they perform poorly --> Use poor public sector performance as an excuse to continue cutting the public sector --> Convince voters to transfer responsibility of the public sector to the private sector.
It's been the Republican playbook for nearly a century. The private sector doesn't do public service, let's just be clear. There are things it's excels at and service isn't one of them.
yes. privatization is just a cheap way to "save taxpayer money" by reducing the wages of workers. who, having less money will pay less taxes and buy less things, thus defeating the "saving" money idea...which is always what happens when governments and business try to save money by cheating its workers.
"Claim." Libertarians simply assert success is individual effort alone, defining away both structural inequities and the reality that nature is predominantly cooperative, symbiotic. So are human organizations; contrary to their fervent beliefs, no boss or owner does everything solo. They just consider themselves Social Darwinist winners with a divine right to rule.
If the system were so perfect, why 1929, the S & L crisis, 2008, etc? Why, when you really examine the theoretical underpinnings of this idealized econ determinism, do they prove so elusive and insubstantial?
Many of us blue collar workers realize the system is a scam. After the '08 crash, corporations were bailed out. For the millions among the majority working class who lost jobs, pensions, houses? Nothing! Many of us are still hurting. Why would we want this same bunch of sleazy manipulators to handle Social Security?
Years ago, when my now ex-husband had taken out a big chunk of his IRA to do he couldn't say what with, he pushed our income into bigger Medicare withholding, which was one of the reasons I divorced him. I visited the local social security office and after a half hour wait talked with a kind if harried employee about what if anything I could do to mitigate his actions. They were able to fix this for me, due to some arcane rule about divorce pending.
After the stupid and vengeful action of this stupid and vengeful "man" pretending to be president, I'm sure this just won't be available to people.
Thanks,America, for believing reality tv is real.
"believing reality TV" I presume you mean Trump voters. How about some context? In the late '70s, the D party was usurped by neolibs, supporters of econopathic trickle-up. They ditched the New Deal and abandoned the majority working class.
The Ds did FOR the suffering unemployed of the Rust Belt/Appalachia same as they did TO the Wall St. vultures who caused the '08 crash--NOTHING! Corporations were bailed out. What help was there for the millions of workers who lost jobs, pensions, homes? NONE! Many of us are still hurting. No coincidence the RB/A area now leads in what are called 'deaths of despair.'
After 40 years of neglect by the party that was once ours, what would you do? Corporate lite Ds aren't much of an alternative. And why do you think there are so many non-voters? Since the neither of the two major parties seems to listen, it's a way of saying NO.
You can thank the elite of the D party for this disaster. Their attitude revealed in 2016 by Sen. Chuck Schumer who said the quiet part out loud. "For every blue collar vote we lose in western Pennsylvania, we will pick up two moderate Republicans in the suburbs of Philadelphia, and you can repeat that in Ohio and Illinois and Wisconsin." (//The Deficit Myth// Kelton, p. 130) Not only morally reprehensible, but stupid politically.
Exactly. Both parties have played too many games with our lives for so long. They ALWAYS tell us what we want to hear using false, empty hopes & promises along with virtue signaling in order to get our votes, especially Democrats. The Democrat party in general had made me an Anarchist three years ago. I'm over them & their performative, political theaters.
All of these politicians are so corrupt & are bought & paid for by their wealthy elite donors, lobbyists, corporate interests, Israel & the Israeli lobby (such as AIPAC), & by globalists to do their bidding. They're NOT for us & WILL NEVER BE for us.
Why is the Social Security Trust Fund so short of funds?
Anne
you are wrong. borrowing from Trust Funds is what all Trust Funds do. They don't keep the money in a safe. they lend it out at interest. The Trust Fund has not been stolen. You are believing in a lie by the people who hate any kind of security for the poor. Their aim is to make you think SS is cheating you so you will stand by while they kill it.
Wow, aren’t you full of assumptions? Do you know what they say about assumptions right? I’m on Social Security and Medicare and have been for 12 years. Both of my parents are as well! So ASSuming that I have any negative feelings whatsoever towards Social Security truly just says a whole lot about you!!!
Anne
this was in my inbox, but i could not find it on the thread. maybe it was the "comment deleted"
Wow, aren’t you full of assumptions? Do you know what they say about assumptions right? I’m on Social Security and Medicare and have been for 12 years. Both of my parents are as well! So AS..ming that I have any negative feelings whatsoever towards Social Security truly just says a whole lot about you!!!
what assmptions are you assuming i am assuming. i try to be very careful with my facts and constantly check myself for hidden assumptions. I do not see that I assumed you had any negative feelings about SS. But you are wrong if you think that borrowing from the Trust Fund has hurt SS.
i think your comment may have been deleted by a robot that things you were using a bad word..so to avoid getting deleted myself i disguised your work a bit because it is no use arguing with a robot.
Kelton's article explains the shortfall is due to most gains on income going to people above the $168,000 cutoff and therefore most income gains aren't taxed for Soc Sec. The cap needs to be raised significantly to tax this income or incomes of working people subject to Soc Sec tax need to increase.
This is wrong. The people above the cutoff do not pay tax on the money above the cutoff, but they receive no benefits from SS above that cutoff. Meanwhile it is the money that they DO pay into SS that provides the extra money needed for SS to pay the very poor who could not save enough for retirement enough to keep them out of the worst poverty. I think you must have misunderstlld Kelton, or she does not understand SS herself.
or i may have misunderstood you. yes the most gains IN income have gone to the richest. but that has nothing to do with Social Security except it encourages some people to think the answer to the projected shortfall is to tax the rich. the rich are already paying for their own benefits...and because SS is insurance..the larger amount they pay on their income below the cap is what enables SS to pay more to you and especially to the poorest workers.
you can fix SS forever by raising your own payroll tax about onedollar per week per year...or you can wave signs"demanding" the rich pay for SS. Roosevelt knew that making the rich pay would mean they would kill SS.
Actually, Congress need only pass a law that any SS shortfall must be covered from the General Fund. Medicare Parts B and D are paid by the General Fund. Moving retirement again from 67 to 70 should never happen.
Pete
raising the retirement age should never happen. but paying for it out of the general fund is exactly what Roosevelt warned against it. If the rich pay for it they will kill it.
Part B is paid for by SS recipients..which is dumb. If they wanted workers to pay for Medicare ("Part B") they should have applied the tax to those workers while they still had jobs. would have been less per month and taken advantage of the "time value of money"...that is the percent of income needed would be the same over time as incomes rose due to both inflation and the growth of the economy.
"Congress need only pass a law..." Ideally yes, but I agree with you and FDR. Especially given the current reality of both major parties being corporate and 1%er sponsored.
I've never come across what you said about Medicare. The union made light bulb above my head just lit up--you're right! (And obviously, you can do math.)
because it is paying down the reserve it created to fund theBoomer generation. but congress has not increased the payroll tax to cover the longer life expectancy of the following generation. even though the tax increase needed would only be about one dollar per week per year. and even the Left is so stupid it goes along with this by demanding the rich pay for Social Security. the rich will NOT pay for Social Security. They woud rather you work until you drop. and they have the power.
why was common deleted?.: trust fun is "short of funds" because it is paying out the money it was designed to pay out to cover the boomer retirement. meanwhile the payroll tax has not been raised enough to cover the cost of increasing life expectancy. this cost would amount to about one dollar per week per year for the average worker.
this comment was written when "comment deleted" appeared where i expected to see my comment. looks like it may have been another comment. so you get to read mine twice. much better.
"I wonder who voters will call when there is no one to answer the switchboard..."
Exactly. The private sector concentrates on efficiency and will cut the service sections of their business until customers complain. But government answers to the American people, and so serving the public is the paramount concern--not cutthroat efficiency. And because the Social Security Administration doesn't have any competitors, it can afford to tolerate some level of inefficiency if the public is better served in the process.
Remember, a private firm has no duty to employ Americans. And when a private firm cuts a paycheck, all of that money is gone. That's why a private firm is so intent on making sure that every paycheck issued is justified. But the government claws back a portion of the paychecks it issues through taxes. The government can actually afford inefficiency if it serves the public and, in the process, provides gainful employment to its citizens. The private sector and the government dance to different drummers.
It seems pretty clear to me that Elon Musk does not understand this distinction.
or he is lying about it. false efficiency always makes for worse results..which appears to be what Musk wants.
You (Grigo] are absolutely right about the difference between government spending and privare spending. if nothing else, the government needs to feed the people during a recession so there will be workers in the future when "the economy"improves, not to mention soldiers to defend the rich when the enemy storms the gates.
i don't think "claws back" is the best phrase to use describing the feedback between government spending and taxes. Kelton has a much better understanding of this...but the problem is not so much explaining it as it is getting the Congress to give up a lie about "deficits" that they find very useful.
"Efficiency"as defined by them, based on assumptions justifying their narrow interests.
The term could just as easily be used to mean the best service for the greatest number--the common good.
The biggest Ponzi scheme going on in America today is DOGE led by Elon Musk. Its astounding how ignorant he is.
michael
first,SS is NOT a Ponzi scheme. but neither is DOGE. Doge is rape and pillaging of a fallen city by conquerers. It is astoundiug how ignorant he is..unless he is just lying because he knows he can get away with it since the people are ignorant of how the economy and SS work.
"Lawmakers Celebrated a Bipartisan Boost to Social Security."
This is wrong. The Fairness Act CUT Social Security under cover of giving increased benefits to people who did not need them and did not pay for them.
Propaganda. Pure, unadulterated lies.
Nobody is cutting Social Security. The Democrat Party has been trying this lie for decades. It isn’t true now and it’s never been true.
Barber
you need to keep up. I have been studying SS for nearly twenty years. BOTH parties have been proposing cuts to SS..."in order to save it." I don'tknow if the Dems are complicit or stupid, but the real tries to cut SS come from the Republicans...except the occasional Obama commission. Meanwhile the Fairness Act has actually succeeded in cutting Social SEcurity and it was bipartisan.
btw I have talked to thousands of people trying to get them to understand SS. what I have found...I think I read this in Kelton's book: "it is easier to fool people than it is to get them to admit they have been fooled."
I am keeping up. The Democrat Party has been trying this same old, tired stunt for fifty years. The voters have grown weary of the boy who cried ‘wolf’.
ken
you only think you have been keeping up. the congress has stopped the assaults on SS because there contituents made them understand they would lose their jobs if they didn't. but you can believe whatever you want. thetragedy is that too many people think like you do. i amfairly sure their strategy now is to let what Musk does to SS kill SS. otherwise we are close enough to Trust Fund Zero that SS will die on its own without anyone's fingerprints on it.
I’ve been following Democrat lies for fifty years. It’s not difficult to keep up when they keep using the same ones.
Congrats Dr Kelton, the Germans are doing MMT.
be intersting to see how that works out. one thing Kelton left out of her book..as far as i have gotten in my seond reading...is that while Greece gave up its sovereign currency and got in trouble when it could not pay back its loans is that the EU could have "printed" the money Greece needed to keep its economy from "austerity". it was largely the Germans who prevented this.
I just had my “windfall” restored. After first saying it could take a year or more they automated the process and a year’s retro benefit appeared in my bank account.
My regular payment is due later this month so we’ll see.
This is what DOGE should be doing.
A 2001 Grover Norquist quote keeps coming to mind: "I don't want to abolish government. I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub."
We are now being dragged into the bathroom and drowned.
Allow me to draw your attention to people who understand - better than I - how SSI works.
1. From https://www.ssa.gov/history/Gulick.html
"MEMORANDUM ON CONFERENCE WITH FDR CONCERNING SOCIAL SECURITY TAXATION, SUMMER, 1941 (excerpt) In the course of this discussion I raised the question of the ultimate abandonment the pay roll taxes in connection with old age security and unemployment relief in the event of another period of depression. I suggested that it had been a mistake to levy these taxes in the 1930’s when the social security program was originally adopted. FDR said, “I guess you’re right on the economics. They are politics all the way through. We put those pay roll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program. Those taxes aren’t a matter of economics, they’re straight politics.” FDR also mentioned the psychological effect of contributions in destroying the “relief attitude.”
2. James K. Galbraith, In Defense of Deficits, March 4, 2010
“What is true of government as a whole is also true of particular programs. Social Security and Medicare are government programs; they cannot go bankrupt, and they cannot fail to meet their obligations unless Congress decides–say on the recommendation of the Simpson-Bowles Commission–to cut the benefits they provide.
The exercise of linking future benefits and projected payroll tax revenues is an accounting farce, done for political reasons. That farce was started by FDR as a way of protecting Social Security from cuts. But it has become a way of creating needless anxiety about these programs and of precluding sensible reforms, like expanding Medicare to those 55 and older, or even to the whole population.”
3.Robert Eisner, Save Social Security from its Saviors, Journal of Post Keynesian Economics, 1998
"Social Security faces no crisis now or in the future. It will not "go bankrupt." It will "be there," not only for those of us now enjoying it of looking forward to it in the near future, but for the baby boomers and the "Generation Xers" following them. All this is true as long as those who would nibble away at Social Security or destroy it in the name of "privatization" do not have their political way. But they very likely will not, since the elderly--and their children--vote, and will vote sensibbly as the full implications of the issue become apparent.
The dangers
The proposed nibbling away of Social Security, including that by some of its presumed friends, is disingenuous and misleading. Even some of its defenders seem all too ready to accept "minor" cuts in benefits to achieve prospective fund balance.
Raising "the retirement age"
One of the more insidious and drastic "solutions" is to increase further the "Normal Retirement Age" or "NRA" of 65, already slated to rise gradually in future years to 67. Actually this had nothing to do with encouraging people to work longer ..."