From: firstname.lastname@example.org (Henry Spencer)
Subject: Re: China to put a Communist on the Moon! Good Grief!!!
Date: Wed, 11 Oct 2000 13:51:55 GMT
In article <39E42FC0.16868C0@nospamplease.erols.com>,
rk <email@example.com> wrote:
>Sorry, Charlie, wrong answer. One of the issues in this election, and
>one that is popular with the people, is to use the capitalist system to
>manage their social security. Most people realize that the socialist
>model is in trouble, the rate of return on having the Government hold
>their money is poor, at best...
Uh, "hold their money"? Social Security doesn't hold anything. Today's
benefits are paid for by today's workers; any resemblance to a savings
plan is misleading. Any "rate of return" on the money you paid in years
ago -- which went to pay someone else's benefits then, not to pay your
benefits tomorrow -- is an accounting fiction. The architects of the
system set it up that way quite deliberately, to avoid the political
warfare that would have erupted over control of such a huge pot of
(Incidentally, they never expected that it would be self-funding forever;
it was always thought that the payroll deductions would eventually have to
be supplemented from general tax revenue, as the system's obligations
>...and at worst, many people feel that paying
>into that system for their whole working career will result in nothing
>being available for them; it'll all be gone.
Again, it can't "all be gone" because it doesn't stick around anyway.
However, it is very likely, going on certain, that the combination of
growing benefit obligations and shrinking payroll revenue, as the Baby
Boomers retire, will eventually result in drastic curtailment of benefits.
In particular, I'd expect to see a means test -- you get it only if you
really need it. (This was rejected in the original design because it was
considered difficult to administer... but that was at a time when filing
income-tax returns was far less universal. Now that virtually everyone
files taxes, the size of the bottom line on the tax form makes a very
simple means test.)
Microsoft shouldn't be broken up. | Henry Spencer firstname.lastname@example.org
It should be shut down. -- Phil Agre | (aka email@example.com)