http://news.yahoo.com/s/ap/20090927/ap_on_go_ot/us_social_se...

Big job losses and a spike in early retirement claims from laid-off seniors will force Social Security to pay out more in benefits than it collects in taxes the next two years, the first time that's happened since the 1980s.

Applications for retirement benefits are 23 percent higher than last year, while disability claims have risen by about 20 percent. Social Security officials had expected applications to increase from the growing number of baby boomers reaching retirement, but they didn't expect the increase to be so large.

ob losses are forcing more retirements even though an increasing number of older people want to keep working. Many can't afford to retire, especially after the financial collapse demolished their nest eggs.

Social Security is projected to start generating surpluses again in 2012 before permanently returning to deficits in 2016 unless Congress acts again to shore up the program.

Article also talks about the trust fund of $2.5 trillion of IOUs.
Politicians will attempt to make good on the IOUs as they wish to be re-elected. But there ain't no guarantee in my way of thinking. tj is eligible for early benefits in 2013. I will be watching the pols closely. And will take the benefit once they decide to grapple with the program deficit to be assured of locking in the benefit under the current rules.

tjscott0 writes,

Article also talks about the trust fund of $2.5 trillion of IOUs.
Politicians will attempt to make good on the IOUs as they wish to be re-elected. But there ain't no guarantee in my way of thinking. tj is eligible for early benefits in 2013. I will be watching the pols closely. And will take the benefit once they decide to grapple with the program deficit to be assured of locking in the benefit under the current rules.

</snip>

Assuming that you're not still working and subject to the $14,160 annual earnings limitation on benefits, why wouldn't you take you're Social Security check on the day you're eligible?

intercst

Ultimately our gov't will save money since fewer boomers will collect the larger checks obtained by waiting for "full retirement age."

Early retirements strain Social Security system

Let me fix this.

Useless military spending drains social security trust fund.

There, that's better.

<<Useless military spending drains social security trust fund.

There, that's better.
>>


Only problem, it doesn't.



Seattle Pioneer

goofnoff writes,

<<<Early retirements strain Social Security system>>>

Let me fix this.

Useless military spending drains social security trust fund.

There, that's better.

</snip>

The Bush Administration's decision to borrow trillions of dollars from China to fund the millionaire tax cuts didn't help either.

intercst

The Bush Administration's decision to borrow trillions of dollars from China to fund the millionaire tax cuts didn't help either.

We could have sold three or four aircraft carriers and paid for the tax cuts.

Assuming that you're not still working and subject to the $14,160 annual earnings limitation on benefits, why wouldn't you take you're Social Security check on the day you're eligible?

intercst

From the link supplied* the benefit increases for me: 5% from age 62 to 63: then 6 2/3% every year from age 63 to age 66; then 8% a year until until age 70%.

1)Those increases in the benefit probably will outstrip the returns from my 70/30 portfolio. Especially as I predict more of the same level of returns as the past decade rather than the smoking returns of the 1990's.

2)As one ages, it is an unknown factor how financially astute a person remains. So I will spend my retirement savings first & hold off tapping into SS. Yes I know there ain't no guarantee of a benefit. But I expect to receive something.

http://www.ssa.gov/OACT/ProgData/ar_drc.html

Only problem, it doesn't.

Well, actually...

The Social Security fund has been running a surplus. A big surplus. A huge, unarguable surplus for the past 20 years.

Where has that surplus gone? Not into investments, or bonds, or even into a lockbox in Al Gore's basement.

No, it has gone to fund other things which the Federal Government has decided to buy, without wanting to raise taxes to pay for them. So instead of having interest paying bonds which would pay for this temporary shortfall, we have nothing.

Well, that's not true. We have aircraft carriers, star wars laser missle defense shields which don't work, nightvision goggles for all my friends, and super-duper troop carriers that can't carry troops in places like Afghanistan.

We spend more on "defense" than the rest of the world combined. That is, a country with 5% of the planet's population, oceanic defenses on two borders and generally unpatrolled borders with two friendly countries on the remaining two - finds it necessary to spend more than the other 95% of the world on war materiel, while complaining that we cannot give people who have paid into a retirement system their whole lives the check which they were promised.

This seems strange to some of us.

<<<Assuming that you're not still working and subject to the $14,160 annual earnings limitation on benefits, why wouldn't you take you're Social Security check on the day you're eligible?>>>

intercst

From the link supplied* the benefit increases for me: 5% from age 62 to 63: then 6 2/3% every year from age 63 to age 66; then 8% a year until until age 70%.

</snip>

I understand that, but you don't have to delay taking your SS benefit to take advantage of it. You can have your cake and eat it, too by using the Withdrawal of Application strategy.

http://www.retireearlyhomepage.com/SS_delay_70.html

intercst

So I will spend my retirement savings first & hold off tapping into SS. Yes I know there ain't no guarantee of a benefit. But I expect to receive something.

http://www.ssa.gov/OACT/ProgData/ar_drc.html - tiscotto
-------------------


Yeah but, what if you kick the bucket? I come from a long line of people who like to die early. In my family if you died in your mid 70's you had a long life. My mom died of stomach cancer at age 51 and my dad died of cardiomyopathy at age 65.

Not to mention I'm significantly overweight and have no interest in dieting and trying to lose weight and it probably drop at least a decade off my life (if not more).

Art

Politicians will attempt to make good on the IOUs as they wish to be re-elected. But there ain't no guarantee in my way of thinking. tj is eligible for early benefits in 2013. I will be watching the pols closely. And will take the benefit once they decide to grapple with the program deficit to be assured of locking in the benefit under the current rules.

There were scare stories like this 20 years ago. My mom used to say, "No Social Security for you!"

Well guess what? I get it. (Sorry Mom.)

I do agree that it should have been required to be actuarilly correct from the beginning, and invested back into the economy. Well, taxes will just have to be raised. (Sorry wings.)

Yeah but, what if you kick the bucket? I come from a long line of people who like to die early. In my family if you died in your mid 70's you had a long life. My mom died of stomach cancer at age 51 and my dad died of cardiomyopathy at age 65.

Not to mention I'm significantly overweight and have no interest in dieting and trying to lose weight and it probably drop at least a decade off my life (if not more).

Art
-------------------------------------------

Then I will have some money on the table and other beneficiaries of the program will have benefited. Course I'll be dead & have no use of that dinero.

---------------------------------------------------------------------
I understand that, but you don't have to delay taking your SS benefit to take advantage of it. You can have your cake and eat it, too by using the Withdrawal of Application strategy.

intercst

----------------------------------------------------------

I'll look at that option in 3 1/2 years. Things could change in that length of time.

I could earn a coupla % interest by putting the monthly benefit into a cd.

"we cannot give people who have paid into a retirement system their whole lives the check which they were promised"


No one was "promised" a dime.

No one was "promised" a dime.

Of course they were. The enabling legislation set aside this program separate and distinct from the rest of the budget - and government - with the sole purpose of taxing current workers and to pay a stipend to retired workers. No other use was to be permitted for these monies.

The enabling legislation sets out, it quite specific terms, how the states are to distribute the monies granted for "state" old age assistance, and separately for federal old age assistance, that "obligations" should be matched as closely as possible with "revenues", and so on.

Here is one portion of the text of the legislation:

SEC. 202. (a) Every qualified individual (as defined in section 210) shall be entitled to receive, with respect to the period beginning on the date he attains the age of sixty-five, or on January 1, 1942, whichever is the later, and ending on the date of his death, an old-age benefit (payable as nearly as practicable in equal monthly installments) as follows:
(1) If the total wages (as defined in section 210) determined by the Board to have been paid to him, with respect to employment (as defined in section 210) after December 31, 1936, and before he attained the age of sixty- five, were not more than $3,000, the old-age benefit shall be at a monthly rate of one-half of 1 per centum of such total wages;
(2) If such total wages were more than $3,000, the old-age benefit shall be at a monthly rate equal to the sum of the following:
(A) One-half of 1 per centum of $3,000; plus
(B) One-twelfth of 1 per centum of the amount by which such total wages exceeded $3,000 and did not exceed $45,000; plus
(C) One-twenty-fourth of 1 per centum of the amount by which such total wages exceeded $45,000.
http://www.ssa.gov/history/35actii.html

If that isn't a "promise" I don't know what qualifies. But then you are of the persuasion that what the legislation says doesn't matter because it conflicts with your personal political views, so I hardly think that actual text from actual law will make much difference to you.

Goofyhoofy,



You linked to something called "Legislative History of the Social Security Act of 1935" which at the very top of the page states:


"This is an archival or historical document and may not reflect current policies or procedures"


Every year we all get an annual statement from the Social Security Administration. It contains an estimate of what your benefits might be in the future depending on various circumstances, but also makes it very clear that the amount of benefits you might receive in the future can change based on changes in legislation.

What you posted is not a "promise" to pay anything to anyone. It is part of the legislative history of the SSA of 1935 taken entirely out of context.

http://www.ssa.gov/history/nestor.html

The fact that workers contribute to the Social Security program's funding through a dedicated payroll tax establishes a unique connection between those tax payments and future benefits. More so than general federal income taxes can be said to establish "rights" to certain government services. This is often expressed in the idea that Social Security benefits are "an earned right." This is true enough in a moral and political sense. But like all federal entitlement programs, Congress can change the rules regarding eligibility--and it has done so many times over the years. The rules can be made more generous, or they can be made more restrictive. Benefits which are granted at one time can be withdrawn, as for example with student benefits, which were substantially scaled-back in the 1983 Amendments.

There has been a temptation throughout the program's history for some people to suppose that their FICA payroll taxes entitle them to a benefit in a legal, contractual sense.

In this 1960 Supreme Court decision Nestor's denial of benefits was upheld even though he had contributed to the program for 19 years and was already receiving benefits. Under a 1954 law, Social Security benefits were denied to persons deported for, among other things, having been a member of the Communist party. Accordingly, Mr. Nestor's benefits were terminated. He appealed the termination arguing, among other claims, that promised Social Security benefits were a contract and that Congress could not renege on that contract. In its ruling, the Court rejected this argument and established the principle that entitlement to Social Security benefits is not contractual right.

Even though it would be political suicide for congress to reduce benefits. They may do so.

<<No one was "promised" a dime.

Of course they were. The enabling legislation set aside this program separate and distinct from the rest of the budget - and government - with the sole purpose of taxing current workers and to pay a stipend to retired workers. No other use was to be permitted for these monies.
>>


A lot of smoke and mirrors. If you don't have an actuarially sound system with real investments that can be liquidated, any promises made are empty ones.

As you know, the Supreme Court made this clear when they ruled that no one has a right to collect Social Security benefits, which can be changed, reduced or eliminated any time the Congress chooses.

And young people would be wise to insist that their taxes go to a program that will protect them, rather than pay benefits to retirees. Take those current tax payments out of the loop and the whole rotten "pay-as-you-go" edifice collapses as Ponzi schemes always do.




Seattle Pioneer

<<Even though it would be political suicide for congress to reduce benefits. They may do so.
>>


Congress has reduced benefits many times in many ways. Currently benefits are being reduced as the normal retirement age increases from age 65 to 67 --- eliminating up to two years of benefits for everyone.

And Social Security benefits are increasingly subject to income taxes, another benefit cut.

There are lots more examples in the history of the program.



Seattle Pioneer

SeattlePioneer analyzes,

And Social Security benefits are increasingly subject to income taxes, another benefit cut.

Private pensions are 100% subject to income tax, how is a partial tax of SS benefits a "benefit cut"?

I've long favored subjecting 100% of SS benefits to Federal income tax to stop people from whining when a portion of their benefit is taxed.

intercst

What you posted is not a "promise" to pay anything to anyone. It is part of the legislative history of the SSA of 1935 taken entirely out of context.

Poppycock. The legislation clearly makes a promise. It still does, even though the many iterations and changes which Congress has wrought through the years.

Now if you are saying "well, it's a promise that might be broken, someday, maybe", I will have to agree with you. Someday the sun will explode, or a meteor will hit the earth, or a virus will kill all of mankind, and the promise will be broken.

That, along with all other "promises" does not make it "not a promise", because the definition of "promise" does not mean infinity, forever, and beyond.

Seattle Pioneer and you seem fixated that because something might change, someday, in some trivial way, that there is not "a promise" to pay benefits under the Social Security system. This is arrant nonsense, hardly worthy of the time I'm taking to type.

And he keeps throwing the word "ponzi" up, even though that is a categorical misuse of the word, but then he thinks it helps his argument to pervert the language, and there is nothing I can do about it. That is unfortunate, for reasonable debate requires a common use of the language, and it becomes clear that he has no interest in reasonable debate on the issue. (For the record: ponzi schemes end when there is NO ONE LEFT to contribute. I am going to presume that there will always be someone working in the United States, and therefore contributing, and therefore (by definition) it will not end, at least until the meteor hits.)

This is all uinfortunate, because I used to have some respect for SP, but it becomes clear that he would rather prevaricate, lie, and ignore simple truth than have a meaninful conversation. Sad.

I still have hope for you, however ;)

What you posted is not a "promise" to pay anything to anyone. It is part of the legislative history of the SSA of 1935 taken entirely out of context.

Poppycock. The legislation clearly makes a promise. It still does, even though the many iterations and changes which Congress has wrought through the years.

******************

Where in the legislative language that you quoted is there a "promise" to pay anyone anything? Nowhere.

It's legislation which if unaltered permits a qualified recipient to receive benefits at a certain level. No different from any other social welfare program. But, it can be changed at the whim/discretion of the legislature. Indeed Congress if it wanted to, could decide to bestow social security benefits on people who have never paid anything into the system at all. It wouldn't make a whole lot of actuarial sense but Congress could certainly do that if they wanted to.

You want to know what a "promise" is? A U.S. treasury bond is a government promise to repay a debt. Backed by the full faith and credit of the U.S. govt. On the local or state level the rough equivalent would be a general obligation bond of the issuing authority.

Now when a worker makes a payroll tax payment each pay period, does s/he receive a bond back from the U.S. government which says "Pay to the order of...." or "Pay to the bearer of..." or "Payable on demand..." or "Payable upon such and such condition..." etc. No of course not.

The worker pays into the Soc. Sec. system because the obligation to pay FICA or payroll taxes is a legal requirement which stands by itself. The worker's obligation to pay FICA is NOT contingent upon a corresponding promise by the government to EVER pay it back. (Certainly there's no "promise" to pay a whole lot more than what was ever contributed.)

A so-called "promise" which can be altered at the whim or sole discretion of only one side of the transaction--in this case Congress--is not a "promise" at all. It's illusory.

Do you know what a "promissory note" is? You know the thing you signed for the bank along with your mortgage. THAT'S a "promise to pay" a sum of money in the future.

We are talking about basic definitions here that you find inconvenient and simply choose to ignore. I know what a "promise" to pay a sum of money by the U.S. government looks like. It looks like a treasury bond. Unless and until the U.S. government starts issuing workers bonds in exchange for their FICA payments you are just kidding yourself (but not anyone else).







Now if you are saying "well, it's a promise that might be broken, someday, maybe", I will have to agree with you. Someday the sun will explode, or a meteor will hit the earth, or a virus will kill all of mankind, and the promise will be broken.

************************

No, what I'm saying is it's NOT a promise because it never was a promise. Therefore when Congress chooses to change/reduce Social Security benefits they are NOT "breaking a promise" because they never made a promise in the first place. It's one thing to say Congress shouldn't reduce benefits well, just because. But that doesn't mean they broke any "promise" by reducing those benefits.

We have a right to remain silent. We have a right to an attorney. We might even have a right to have an abortion, and we might even have a right to adequate health care.

What we do NOT have is a "right" to Social Security benefits, in the sense that Congress MUST provide them to us in the same way that indigent criminal defendants MUST be provided with legal counsel. For an existing level of benefits and procedural regime, we have procedural due process rights under Goldberg v. Kelly and similar cases. That means if you qualify for the benefits under existing legislation you can't be arbitrarily denied those benefits without due process. It does NOT mean however that Congress is obligated to provide a particular level of benefits in the first place.




That, along with all other "promises" does not make it "not a promise", because the definition of "promise" does not mean infinity, forever, and beyond.

************************

Well, I think at a minimum any "promise" has to include a binding obligation. Since by definition there is no binding obligation placed upon Congress to provide any particular level of benefits, then there's no binding obligation, hence no promise.





Seattle Pioneer and you seem fixated that because something might change, someday, in some trivial way, that there is not "a promise" to pay benefits under the Social Security system. This is arrant nonsense, hardly worthy of the time I'm taking to type.

*************************

Well I don't speak for Seattle Pioneer, but I think you are a little bit disconnected from reality don't you? If you call up the Social Security Administration itself they will tell you that there is no "promise" to pay you anything in the future and all they can do is estimate your possible future benefits assuming "nothing changes."





And he keeps throwing the word "ponzi" up, even though that is a categorical misuse of the word, but then he thinks it helps his argument to pervert the language, and there is nothing I can do about it. That is unfortunate, for reasonable debate requires a common use of the language, and it becomes clear that he has no interest in reasonable debate on the issue. (For the record: ponzi schemes end when there is NO ONE LEFT to contribute. I am going to presume that there will always be someone working in the United States, and therefore contributing, and therefore (by definition) it will not end, at least until the meteor hits.)

**********************************

Well a Ponzi scheme is generally recognized as being when the initial investors are not actually paid a return on their own investment, but rather, paid an alleged return which is actually funds contributed by the "new investors." Seems like a pretty good description of the Social Security system to me. The payments to current retirees are not coming from investment returns of their contributions, but rather, are direct transfer payments from new contributions of the still-working.

This is an odd conversation because I thought EVERYBODY already knew that. Characterizing social security as a Ponzi scheme is a truism, it has all the characteristics of a Ponzi scheme.

And your statement that a Ponzi scheme doesn't end unless there is NO ONE LEFT to contribute not only strikes me as ridiculous, but rather as a wistful, desperate cry from someone who doesn't want to acknowledge the truth of the matter.





This is all uinfortunate, because I used to have some respect for SP, but it becomes clear that he would rather prevaricate, lie, and ignore simple truth than have a meaninful conversation. Sad.

I still have hope for you, however ;)

**********************

Is that a "promise"?

This is all uinfortunate, because I used to have some respect for SP, but it becomes clear that he would rather prevaricate, lie, and ignore simple truth than have a meaninful conversation. Sad.

I still have hope for you, however ;) - Goofyhoofy
--------------------------------------------------------------


LOL! You've never heard Seattle Pioneer's slippery slope arguments before? It's one of his favorites. If we let gays marry the next thing you know "Donkeys, ponies, dogs, cats, rabbits, and 5 year olds will want to get married!"

I'm still chuckling to myself. Arguing with Seattle Pioneer and Telegraph is somewhat akin to banging your head against a cinder block wall. You are not likely to make much headway.


Art

Where in the legislative language that you quoted is there a "promise" to pay anyone anything? Nowhere.

(a) Every qualified individual (as defined in section 210) shall be entitled to receive, with respect to the period beginning on the date he attains the age of sixty-five, or on January 1, 1942, whichever is the later, and ending on the date of his death, an old-age benefit (payable as nearly as practicable in equal monthly installments) as follows:

I put it in bold this time, because apparently you had difficulty finding it the first time. "Every qualified individual ... shall be entitled to receive..." Sounds like a "promise" to me.

Oh, right, because it might be changed someday, it's not a promise. I guess that means anything that might be changed by legislative fiat is not a promise. Therefore property you own which might be condemned or taken by eminent domain means you don't really own it; the promise between you and your employer on your wages doesn't count, because taxes might go up, reducing your paycheck; the benefit of a road or development you were "promised" in a referndum might be delayed or aborted for other reasons isn't a "promise" either.

I guess, using your absolutist position, there is no such thing as a "promise" anywhere, at any time.

We are talking about basic definitions here that you find inconvenient and simply choose to ignore. I know what a "promise" to pay a sum of money by the U.S. government looks like. It looks like a treasury bond.

And yet we know that governments default on their treasury bonds when it is inconvenient for them to redeem them. Apparently that does not qualify as a promise, either. (Indeed, I can find far more instances of government default on bonds than you can on government default of Social Security payments, no?)

Of course I'm talking about the real world here, not some debate class fine parsing as you are.

Well a Ponzi scheme is generally recognized as being when the initial investors are not actually paid a return on their own investment, but rather, paid an alleged return which is actually funds contributed by the "new investors." Seems like a pretty good description of the Social Security system to me.

Of course it does, because you are philosophically locked into your position, unable to think or reason. By your own definition, the monies you pay for a life insurance policy to State Farm are a ponzi scheme. You do not get "your own money" back, you get somebody else's. State Farm may have assets (stocks, bonds, real estate), but then so does the Federal (and State) government. Heck, Chicago just sold off a tollway and raised several billion dollars. How is that different?

This is an odd conversation because I thought EVERYBODY already knew that. Characterizing social security as a Ponzi scheme is a truism, it has all the characteristics of a Ponzi scheme.

It's only odd because you apparently believe everyone thinks as you do, when the reality is that only a very few ideologues do. The vast majority of America - and virtually every other developed nation on the planet - accepts a Social Security system as a time tested and well developed program - which works, which reduces poverty, which ameliorates the wild swings in the market by providing liquidity, and so much more.

Social Security is almost universally accepted. Ponzi schemes are universally despised. You think they are the same? You need to get out more.

<<Now if you are saying "well, it's a promise that might be broken, someday, maybe", I will have to agree with you. Someday the sun will explode, or a meteor will hit the earth, or a virus will kill all of mankind, and the promise will be broken.
>>


To be consistent then, I suppose you would say that Obama is breaking a promise by aiming to end the Medicare benefits people are getting through private insurance companies?

If people are really getting "promises" of benefits, then the Congress loses it's moral authority to alter or abolish such programs should it choose to do so. It clearly needs that authority.



If people had a contractual right to Social Security benefits that could not be arbitrarily taken away, I'd say they have a promise.

Instead what they have is a benefit which can be increased, cut, altered or abolished whenever the Congress chooses to do so. I don't think there can be much dispute about the Congress cutting two years of Social Security benefits by raising the normal retirement age from 65 to 67. (intercst's objections to characterizing the taxation of benefits as a "cut" is reasonable).


<<And he keeps throwing the word "ponzi" up, even though that is a categorical misuse of the word, but then he thinks it helps his argument to pervert the language, and there is nothing I can do about it. That is unfortunate, for reasonable debate requires a common use of the language, and it becomes clear that he has no interest in reasonable debate on the issue. (For the record: ponzi schemes end when there is NO ONE LEFT to contribute. I am going to presume that there will always be someone working in the United States, and therefore contributing, and therefore (by definition) it will not end, at least until the meteor hits.)
>>


Heh, heh! I often find that my liberal friends are sensitive to having their mostly unfunded benefits programs described as Ponzi schemes. Despite Goofyhoofy's protests, I think that's a perfectly reasonable description.

The only thing that has prevented Social Security and Medicare from failing many time is the willingness of the Congress to compel new groups to pay, and to pay ever higher taxes. If that pattern doesn't continue into the future, the programs will fail.

Young people would be smart to refuse to pay, and insist that their tax dollars go into a new program that gives people a contractual right to benefits from the money they pay ---- that would be a real promise, and would cause the Social Security and Medicare houses of cards to collapse rather quickly.

<<This is all uinfortunate, because I used to have some respect for SP, but it becomes clear that he would rather prevaricate, lie, and ignore simple truth than have a meaninful conversation. Sad.

I still have hope for you, however ;)
>>


Oh, I think my arguments are reasonable. I'm afraid I am a lost cause for you on this issue Mr. Hoofy.




Seattle Pioneer

<<LOL! You've never heard Seattle Pioneer's slippery slope arguments before? It's one of his favorites. If we let gays marry the next thing you know "Donkeys, ponies, dogs, cats, rabbits, and 5 year olds will want to get married!"
>>


Heh, heh! The Mormons were greasing that slippery slope 160 years ago claiming a right to polygamy.

Were there a "right" to marriage, I see no reason why polygamy wouldn't be a right as well.


After all, only a tiny percentage of human social relationships are eligible for marriage. If there were a "right" to marriage, any group of people could get married. So I reject the idea that there is a "right" to marriage.


What is reasonable is for homosexuals to petition to be allowed to join the narrow and exclusive club of social relationships permitted legal marriage. They are certainly entitled to get state legislatures to change the laws to permit that.

I simply find it absurd to talk about marriage as a "right" when it is properly a legal provilege granted to a handful of human social relationships.



Seattle Pioneer

<<Oh, right, because it might be changed someday, it's not a promise. >>


It's not theoretical.

Social Security benefits have been changed and "cut" in many ways over the decades.

Perhaps the most dramatic cut is increasing the normal retirement age from 65 to 67. That cuts TWO YEARS of benefits right off the top, where they cost people the most.

But we are disputing over the meaning of the word "promise."

I'll certainly agree that the Congress has declared a schedule of benefits to be paid to eligible people. If you want to consider that a "promise," that's reasonable enough at any particular time.


But the Congress retains the ability to increase, cut, alter or abolish those benefits whenever they wish by passing a law. As the increase in the normal retirement age demonstrates, that's a lot more than a theoretical power.

And right now, Obama and the Democrats want to take away the current ability of people to choose their Medicare benefits through private insurance companies. Are they violating a "promise" by proposing to make that kind of change in Medicare benefits?


At any particular point in time, you have a promise that you can collect the benefits authorized by the Congress. But those benefits can be changed at any time by passing a law. That doesn't seem like a "promise" long term, especially when those programs (especially Medicare) are severely underfunded.

Perhaps Mr. Hoofy would be willing to recognize that there are two kinds of "promises," one based on current benefit schedules which IS a promise, and the other recognizing the long term ability of Congress to increase, cut, alter or abolish benefit schedules which means that there isn't a meaningful or enforceable promise long term.



Seattle Pioneer


(And I'm finding "Mr. Hoofy" a fun way to refer to my liberal friend Goofyhoofy that I haven't seen used before)

"Where in the legislative language that you quoted is there a "promise" to pay anyone anything? Nowhere.

(a) Every qualified individual (as defined in section 210) shall be entitled to receive, with respect to the period beginning on the date he attains the age of sixty-five, or on January 1, 1942, whichever is the later, and ending on the date of his death, an old-age benefit (payable as nearly as practicable in equal monthly installments) as follows:

I put it in bold this time, because apparently you had difficulty finding it the first time. "Every qualified individual ... shall be entitled to receive..." Sounds like a "promise" to me."
///////////////////

No, it's not a "promise." It's an "entitlement." That's why it says "entitled," not "promised." The difference between an "entitlement" and a "promise" is that "entitlements" are within the power of Congress to bestow, or to take away, as it sees fit pursuant to its constitutionally-bestowed powers to "tax and spend."

Social security payments, and legislation related to them, is no different in principle than something like "cash for clunkers." Congress has the constitutional authority to create an entitlement program called "cash for clunkers" in which it gives several thousand dollars each to an arbitrarily-defined group of automobile owners. But it has no obligation to do so and has not "promised" to do so. If and when the money runs out, Congress can 1) extend the program; 2) modify the program; 3) end the program. And that's exactly what happened.

If because of actuarial realities Social Security is unable to fund itself then Congress certainly has the option of raising taxes, finding other funding, or what not to keep the spigot flowing to recipients. But just like cash for clunkers, it can modify the program, and indeed, it can even end the program entirely. There is absolutely nothing (other than political realities) preventing Congress from declaring an end to the social security program tomorrow. There's certainly nothing stopping Congress from changing the program such that the maximum lifetime benefits one may receive cannot exceed the actual amount of contributions of that individual (plus earnings if there are any). There is nothing stopping Congress from changing the definition of "qualified individual." Congress could decide that you can't collect benefits prior to the age of 80 if they want to. Tough. They didn't break a promise because they never made a promise.


A "promise" is completely different. In order to be enforceable and non-illusory, a "promise" must be supported by legally valid consideration. I.e. a valid contract. That's why I provided you with the perfect example of a true "promise to pay" which completely refutes whatever point you think you're trying to make: A U.S. treasury bond, which the U.S. gov't. is obligated to pay back supported by the "full faith and credit" of the federal government.

The cost of the bond is directly paid for and explicitly in exchange for the bond itself. Not so with Social Security, cash for clunkers, nor any other "entitlement" program. Your present obligation to pay FICA on your wages is not causally related to what you might receive, it is not in exchange for what any future legal right to receive, and it is due and payable by you regardless of what if any benefits you might be eligible to receive down the road.


Similarly, there is no "right" to receive welfare payments, other than of course a procedural due process right (i.e. you can't be denied an otherwise existing entitlement benefit without due process protections but Congress has no obligation to provide for the entitlement in the first place).

You lack understanding of some pretty basic issues of law and politics if you don't realize the difference between a "promise to pay" by the government (which is "money" or "as good as money") and an "entitlement program."

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Oh, right, because it might be changed someday, it's not a promise.

--Close, but not precise. It's not a "promise" because it can be changed someday without the change constituting the violation of any existing and binding legal obligation. There's no promise there goofy. Your premise is faulty, so your conclusions are incorrect.

Now, if you were holding a U.S. treasury bond and the government refused to pay you back the principal upon maturity, or refused to pay the coupon payments, then that's another story. U.S. bonds are backed by "full faith and credit." Entitlement programs including SS are not.


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I guess that means anything that might be changed by legislative fiat is not a promise.

--Social security was created by legislative fiat, and therefore can be changed or even eliminated by that same legislative fiat without violating any right or as you call it "promise." Again as long as procedural due process rights are followed.




Therefore property you own which might be condemned or taken by eminent domain means you don't really own it;

--Ah perhaps a glimmer of understanding might penetrate the darkness?

Presumably if your property is being condemned it's because you have legal title to the property. I.e. a fee simple ownership interest in the property. Similarly, if you purchase a U.S. treasury bond, you actually own that bond and its earnings, you have actual legal title to that bond. The bond itself constitutes personal property which you actually own.

Not so with an expected future stream of payments from an "entitlement" program like SS. You do not "own" that future stream of payments. You have no title to those payments. This is the critical distinction which you refuse to recognize.






the promise between you and your employer on your wages doesn't count, because taxes might go up, reducing your paycheck;

--Once again you are wrong. As an employee you have a contract either explict or as a matter of law in the case of at will employment in which the work is performed directly in exchange for your pay at the agreed upon rate. "I.e. I will work for you for $10.00/hour" is a promise for a promise and both are enforceable.

Not so with social security. Your FICA tax obligation is not "in exchange for" any particular future payment stream. The government does not say to you, ever: "If you make such and such FICA payments now, we promise to pay you "X" amount of dollars at such and such time in the future." Never. You are dreaming if you believe that. Because the opposite is true: The government has told us that our FICA obligation is WITHOUT ANY GUARANTEES as to what we may receive in the future from the program. This is explicit.



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the benefit of a road or development you were "promised" in a referendum might be delayed or aborted for other reasons isn't a "promise" either.


---The only referendums I have ever seen include only authorizations of the taxing authority to tax and pay for the project, but no promise by the taxing authority that the project will be successfully completed for the projected amount.

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And yet we know that governments default on their treasury bonds when it is inconvenient for them to redeem them. Apparently that does not qualify as a promise, either. (Indeed, I can find far more instances of government default on bonds than you can on government default of Social Security payments, no?)


In order to "default" there has to be a defaultable obligation. Government bonds (or corporate bonds for that matter) are an example of such an obligation. A future income stream under an entitlement program is not.

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Of course it does, because you are philosophically locked into your position, unable to think or reason. By your own definition, the monies you pay for a life insurance policy to State Farm are a ponzi scheme. You do not get "your own money" back, you get somebody else's. State Farm may have assets (stocks, bonds, real estate), but then so does the Federal (and State) government. Heck, Chicago just sold off a tollway and raised several billion dollars. How is that different?

--Once again you are incorrect. A legit insurance company such as State Farm is legally obligated to have reserves against losses which are actuarially-based. The reserves come from policy premiums. '

Chicago did not actually sell off a tollway by the way. They leased it to a private corporation giving the corporation the right to collect tolls on it. As to "how that is different," what can I say to someone who doesn't know what a Ponzi scheme is?

Goofhoofy, the power of the internet gives you the power to say whatever the heck you want to within very broad limits. It gives other similarly inclined people the right to "rec" your posts to the high heavens.

What it does NOT give you the power to do, is to demand a free education from those who are more well-informed and better-educated than yourself, esp. when you are obviously not receptive to any opinions other than your own--INCLUDING the clearly-stated opinions of the Social Security Administration itself.

There is no free tuition, in college, in life, or here on the internet.

To be consistent then, I suppose you would say that Obama is breaking a promise by aiming to end the Medicare benefits people are getting through private insurance companies? - Seattle Pioneer
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So like you don't get exposed to enough political drivel on the Retire Early CampFIRE board so you have to come over here and get an extra-heaping helping of it? The CampFIRE board averages over 200+ posts per day and I'd say 90+% of them are politically oriented gibberish? Seems like that would be enough politics for anybody.

Artie

<<To be consistent then, I suppose you would say that Obama is breaking a promise by aiming to end the Medicare benefits people are getting through private insurance companies? - Seattle Pioneer
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So like you don't get exposed to enough political drivel on the Retire Early CampFIRE board so you have to come over here and get an extra-heaping helping of it? The CampFIRE board averages over 200+ posts per day and I'd say 90+% of them are politically oriented gibberish? Seems like that would be enough politics for anybody.

Artie>>



Having so many posts agreeing with your politics is no fun. What is needed is a little duality and separation, Art. I'm surprised I have to point that out to you!




Seattle Pioneer

Having so many posts agreeing with your politics is no fun. What is needed is a little duality and separation, Art. I'm surprised I have to point that out to you! - Seattle Pioneer
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Heh heh heh! You said it not me! That one doesn't count against me does it? You read on the other board where somebody posted something about how they'd rather read political drivel than my NDE & separation posts. I'm not sure who said it though because whoever said it is having a time-out in my P-box. The only reason I know it was posted was because someone else copied and pasted it into their post without writing the original author's name.

I'm getting less tolerant of meaness in my old age. If they are snarky and nasty to me I give them a time-out.

Artie