Baby Boomers are becoming older. In fact, some have reached retirement age. As more Baby Boomers reach retirement age, there will be less social security to go around. In addition to that scenario, the unemployment rate is high and has only slightly diminished. Because of the increasing numbers of Baby Boomers reaching retirement, there is apprehension that social security will be bankrupt if Congress does not address the situation at hand. .
By 2017, social security is expected to start more out paying more than it collects. according to a 2009 Report by the Social Security and Medicare Board of Trustees. According to them, there is a large surplus of social security monies but it will be drained by the year 2037. The report maintained that from 2037 on, social security will only be able to pay 75% of its benefits. However, according to another report by the Congressional Budget Office purport that it probably will be another decade before the social seurity system will collapse. What DO you think about this issue?
With a few small adjustments Social Security can and will be put on a sound financial footing for the forseeable future. Medicare is the tough problem, not Social Security. I wonder where all the rumors of SS going broke are coming from.
The 'rumors' are coming from the fact that it *is* going broke.
Yes, we can change it. But in it's current state, it doesn't work. No rumors about it.
Yes, it would have been nice if the Congress (both sides of the aisle) would have tried to work something out when Bush tried to reform SS, like Ryan is trying to do now with Medicare. Why can't they just have some guts and put a plan out there? Are they so power hungry that they can't face solving a problem and then not being re-elected? At least the problem would have been solved in the end.
An unsustainable system is just that, unsustainable.
Ironically, Romney will probably be the one to actually fix it, if he is elected.
I think his plan to make SS more progressive(less benefit for wealthy) will get the D votes needed to also raise retirement age...
I hope so, i have never seen any reason why SS and Medicare shouldn't be means tested...In fact I remember my Grandmother telling me years ago that she would have to spend her own money on a nursing home before Medicare would start paying for it. I don't know if that's true, but if so, it makes sense. Of course she didn't think so, and ended up dying at home.
But for those of us who will have nothing if the problem isn't fixed, some concessions have to be made...
It shouldn't be means tested... that's just redistribution of wealth, and we have enough of the rich paying for everything already.
It should just be adjusted for life expectancy. That's the biggest reason we have the problem. It was designed for people who would live X years, not X+15 years.
Ralph, please enlighten us as to what these "small adjustments" should be.
SS is an upside-down fiscal pyramid. Nothing small is going to fix it.
Here are some of the options under consideration--
1. Gradually raise the age for normal benefits out of recognition that people are living longer in good health and are capable of working longer.
2. Increase the FICA taxable income amount of $110,000 and index it going forward.
3. Remove the maximum FICA taxable income amount, i.e. make all income subject to SS tax.
4. Adjust the COLA formula to provide smaller increases out of recognition that the current COLA adjustment formula produces adjustments that exceed actual cost increases experienced by retirees, according to some analysts.
Most people expect that a combination of several of the above changes will be required.
None of the adjustments to the limit on taxable income would do anything to help. You would also have to reduce the benefits of those who are paying more.
In other words, have the rich subsidize the gap.
"None of the adjustments to the limit on taxable income would do anything to help."
Why do you say that? Raising or eliminating the earnings limit would bring in a huge increase in SS tax revenues. Especially if the earnings cap was eliminated, making all wages and salaries taxable.
You are correct that adding a means test of some kind for SS benefits is another measure that has been suggested for consideration.
Because Ralph, it will also increase the future outlays. As well, richer people have longer life expectancies, so they draw longer. Simply raising the cap could make the problem worse, you would have to raise the cap, but tell the rich they aren't getting any extra benefit.
As designed and working right now, Social Security simply CANNOT last and time is running out on a clean fix. Hopefully sanity will prevail but I don't hold out much hope.
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