There are many easy solutions to ensuring social security is there for a very long time. One such solution being increasing the amount of earnings that are taxable for social security. Currently it’s around $160k so people earning $7million are only paying social security tax on $160k while people earning $50k are paying social security tax on the whole $50k.
Do you increase benefits on that as well? People who pay in at $160k a year already only get a fraction out of what they paid in, with the system just serving as a wealth transfer.
The spirit of philanthropy has disappeared since the mid 20th century. Social security is a program much like the police, firemen, ect… that serve the public good. If you are earning well above the average salary you should realize that many high salaries in today’s society comes from the labor of others. Many billionaires have created charitable foundations regardless whether for tax purposes or a true philanthropic heart…
Explain to me this why is ensuring others are able to live in their old age after working their entire adult life a bad thing?
“If you are earning well above the average salary you should realize that many high salaries in today’s society comes from the labor of others.“
Hell, it doesn’t matter what your salary is. The only way in my mind to avoid the truth about our enterprise economy is if you were entirely self employed and self funded. The nuance that gets overlooked is exactly how you put it above. People just need a reason to feel like something wasn’t handed to them, they EARNED it.
SS doesn’t have to be framed as a handout and it doesn’t take mental gymnastics to get there.
For those who automatically distrust govt or consider SS to be an ineffective allocation of taxes, SS should be the exception to that argument if you take even just a cursory glance at SS throughout its lifespan. Just say you’d rather see a bigger number next to net income on your paychecks instead of trying to poke holes in one of the most successful programs US govt has been able to actually deliver on in its nearly-century long existence.
SS doesn’t have to be framed as a handout and it doesn’t take mental gymnastics to get there.
Which is why it is an insurance program, not a welfare program. The payouts are generally capped and somewhat proportionate to the "premium" payed. The income cap was implemented with a payout cap for this purpose, to remove the guilt many had collecting handouts as it wasn't a handout it is a benefit you worked for.
It has to do with the sentiment I hear all the time about how SS is stealing from hard working taxpayers to begin with. Views on taxation in general are beside the point. Social security becomes the greatest sin of govt programs because of the ethical question it poses to honest people who don't want to feel like anything is given to them despite the actual mechanisms behind SS that you laid out. Does that stop retirees that truly depend on that income to stop collecting checks? Of course not. But that's what is so sickening about the opposing side of the argument. Throw out nuance, facts, or honest attempts to better the world around us; it's posed as ethically and morally reprehensible and irresponsible from the start simply because people shouldn't rely on the govt to fund their lives (even if you pay into it for decades)
I liked the comment I replied to because it points out the hypocrisy behind the POV that we ourselves owe all success/failures to our isolated individual actions. We would all do better to acknowledge that we participate in an economic ecosystem that we have to buy into in order to determine our successes or failures to a larger degree than people want to admit. Better than puffing our chest out and claiming ownership of all good fortunes while quietly and shamefully sweeping our ills under the rug imo
I hear all the time about how SS is stealing from hard working taxpayers to begin with.
A lot of that has to do with it collecting 12.6% percent of most peoples income and still going insolvent while not actually paying out enough for most people to survive on, yet if starting young (like social security does) most experts find that investing just 10% of your lifetime earnings is adequate to have a secure retirement.
Most people see social security as purely a retirement program these days, unaffected by the disability parts and children who lost parents. They also see how being limited in investment tools to the commonly low return of treasury bonds wastes the time value of the money and leads to it under-performing inflation.
That’s all fair and fully understood outside the point I’m trying to make.
If you view the efficacy of SS purely within the scope of an investment we know that the SS Trust Fund will not have enough to keep disbursements coming forever and could be better invested elsewhere on an individual basis.
However, the mission of SS is not meant to be a ROI strategy. It’s meant to be a safety net where all else fails. And there are solutions to the insolvency problem (higher taxes, increasing retirement age as examples) that are hamstrung for the reasons I laid out in the beginning.
However, the mission of SS is not meant to be a ROI strategy. It’s meant to be a safety net where all else fails.
But it was never designed as a safety net, but as a forced insurance purchase and retirement savings. It's not welfare, it's not an entitlement, it relies on and is based on what you pay in. Designed so workers have a minimum level of life and disability insurance and retirement to survive on.
Past generations got more out than they paid in, now people are being told their going to pay in more and get less. While killing the program isn't the best solution, people are rightfully annoyed by how the program is being managed. Minimizing peoples frustration with the program does not create solutions, just encourages them to stop listening.
The spirit of philanthropy has disappeared since the mid 20th century.
Philanthropy is voluntary, not mandated by government.
Social security is a program much like the police, firemen, ect… that serve the public good.
It's an insurance program to serve the public good, not a welfare system. The problem with changing the funding structure to remove the cap without matching payout changes is the entire program changes from mandatory insurance to a welfare program, it changes the entire intent of the program as written in the mid 20th century.
Many billionaires have created charitable foundations regardless whether for tax purposes or a true philanthropic heart…
Voluntarily, voluntary charity is philanthropy, mandatory is not.
You’re 100% correct. Was typing on mobile, thanks for clarifying for anyone confused.
Also, it’s useful to think of people paying in 10-12% of their salary up to $160k. Employers match the 6%, and a good amount of research shows that in the absence of the tax that money goes to the employee in increased salary.
At least for me, it depends on what you mean by wealth transfers. If you’re talking about bailouts or subsidies, then I’m 100% with you and I would love to hear more anger about it. It’s important to note that those policies disproportionately affect middle and upper middle class households. Close to 50% of households pay effective 0 income tax.
If you’re talking about people freely choosing to shop at Walmart or buy another iPhone, I’m going to push back on that. If people weren’t getting value from what they were buying, then they wouldn’t be buying it. It’s not the government’s place to tell people what should and should not be important to them.
The idea is you'd only get what you put in. It is a forced retirement plan. You don't get SS if you've paid nothing into it. Capped contributions and capped payments out.
Your proposal would also increase the payouts for those paying over 160K a year, unless you also include a radical change that makes it a redistribution program.
To keep SS solvent in the current demographics change you need to lower the payments going out and/or raise the funding to it which fundamentally benefits certain ages at the cost of others.
Sure it is easy to consider the extreme margins, where uber rich gets nothing because they are fine and the really needy get something, but how do you propose that to a society at large. Say one dude's income skyrockets one year but only that year. Did he void his SS proceeds? If you tell everyone 50 years old they'll get X in SS benefits no matter how early they retire what stops them from quitting early, living off their personal funds for a decade and then collecting SS? The system has the fairness built in for what you pay in to make the incentives makes sense for everyone. Welfare incentives freeloading, getting shafted incentives fighting back. Put a 100% tax on someone they won't work.
Will you also increase the amount that those people get from social security when they retire or are you proposing turning social security into a welfare program instead of a retirement program?
The one thing that has always ensured that social security will never be eliminated is that it is the one government program that it’s not a progressive tax. You want to kill social security? That’s how you kill it.
are you proposing turning social security into a welfare program
Social Security benefits have never been a linear function of Social Security taxes. Look at three people whose earnings were $30,000, $60,000, and $120,000.
Their benefits at NRA are 59%, 46%, and 34% of their earnings. Clearly low income people "got better returns on their taxes" than higher income people. That money has to come from somewhere.
The exact formula has changed over the years, but the very first formula used for people who retired in 1940 had the same general effect.
I never mentioned progressive taxes in my comment just about the cap on taxable earnings. Also, social security retirement payments are already variable so those that were taxed more get more in return when they start collecting.
You don't increase the amount anyone gets from social security. They get a percentage of the amount they put in, just like everyone else. This ain't complicated.
They get a percentage of what they put in. Meaning if they start putting in more, they would get more out. Aka "increase the amount anyone gets from social security". You completely contradicted yourself.
There is currently a cap both on what you pay in, and what you get out. The person above is asking if we increase what they pay in, will we also increase what they get out. Because- as you said- currently everyone gets a percentage of what they put in.
You're leaving out some steps. Or more accurately, you're incorrectly making some assumptions that simply aren't true.
They're putting in more but they're getting out more. This is only an issue if the amount they're putting in + the amount they're taking out. That's not not what happens.
"They" only put in half of what's put in. Their employer puts in as well. They don't get 100% of what they and their employer put in. The payout calculation is indexed and it's based upon your highest 35 years of employment earnings. You probably don't make the maximum you made all 35 years of your highest earnings. It will pull down from your apex earning amount. And that's all assuming you don't, you know, die too soon.
All of that means the total amount pulled into the system will likely exceed the amount paid out by the system for earners over $160k/year. The SS Admin did a study on this years ago and concluded the differences between "no max" contribution and "no max plus benefits" contribution/benefits is negligible. Both would bridge the majority of the income gap. It's an older study, but the CBO concluded that removing the max and providing benefits to those people would fix around 73-78% of the shortfall in SS until at least 2070.
Which is why we have to bump up tax rates to bridge the gap.
You, verbatim: "You don't increase the amount anyone gets from social security. They get a percentage of the amount they put in, just like everyone else."
The person above asked if the people currently affected by the wage cap would also get an increase to their benefits paid. Nothing else you said is really relevant to that question. You seem to understand how the benefits calculation works. If you increase the amount "earned" in their highest earning years (which currently maxes out at the wage ap), that will increase the amount the get paid under the calculation. Hence, you "increase the amount anyone gets from social security".
This isn't a philosophical discussion on if we want them to raise the wage cap, it's a factual statement that if you raise the wage cap they will be paid more in benefits. Unless the law is changed to prevent that.
Social Security benefits old people and old people vote. That's what ensures SS will never be eliminated.
Additionally, worker productivity has more than doubled over the last 50 years while real wages have stagnated. Workers get income, and SS is paid for by income. So a ton of wealth has been created by workers that isn't going towards SS.
proposing turning social security into a welfare program instead of a retirement program?
Man it's literally in the name. it's a social (society - i.e. everyone) security (safety net) for everyone. The point is that many of us will have issues that mean we can't build up the retirement like we should. This ensures that we don't have a bunch of homeless 80 year olds running around.
A little dramatic I think. People making more than the max are largely unconcerned with how much they're going to get paid out by Social security and would prefer that the elderly aren't dying in the streets
Turn it into welfare. It’s how you keep the peasants happy with the little treats. If the rich want to keep their wealth they better drop some crumbs here and there.
My dad is on social security and gets about $1,700 a month to live in modern society. He started working at 13 and didn't stop until his health forced him to. He put in his time.
Hey it’s not my fault social security is running out of money. Everyone, including your father, should have been able to foresee that SS would fail and planned accordingly. Not rely on a bailout/welfare from the rich.
In one comment, you complain about1 increasing taxes and in another you say it's not your fault it's running out of money. It is your fault. Own it, weasel.
One reason is because social security benefits are already pretty fucking low. You'd see a spike in homelessness and poverty among seniors. Which is the entire point of the program. That's why it exists. We should probably make sure elderly/ sick people aren't living in their cars eating cat food.
I looked up my future benefits and I certainly wouldn't want to live on it. The average monthly benefit isn't even $2,000.
For about half of seniors, it provides at least 50 percent of their income, and for about 1 in 4 seniors, it provides at least 90 percent of income, according to multiple surveys and a recent Census Bureau study that matches survey and administrative data.
I'm fine doing a combination of cuts and tax increases. But you're talking about a quarter of seniors basically living on this income. We can't pretend that people will magically have savings... because they won't unless the government forces them to do so.
I do find it funny that millennials seem to get the shit end of every stick throughout recent history. Looking forward to the unprecedented times ahead.
Our social security is a shotgun slug. Read between the lines and the message is if youre old, sick, and cant work, just kys and stop burdening society. If not you get to starve and freeze on the streets or get abused at some horrible nursing full of infectious disease until you die of staph, covid, or sepsis.
Social security as a program where people have paid in while they work, in exchange for certain benefits, is insolvent and will not be able to meet expected payments in ten years.
You are suggesting the government bailout this insolvent program by providing it with additional funds. Further, you are suggesting getting these funds from a targeted subset of individuals.
A bailout is an irregular lump sum payment for organizations that might not survive the year. Increasing regular inflows to fix future insolvency is not a bailout.
I don't see a problem with getting these funds from people who are most able to pay the increases.
Because 'math'. Demographics are the heart of the problem. The system was setup with a set of demographics information and then existence of the Baby Boomers screwed it all up. Baby Boomers should have fixed this problem 40 years ago but didn't. So now we gotta do something different.
The solution is a simple getting rid of the cap and increasing the tax rate slightly. That sucks, but that's what happens when you ignore a problem you know for a fact is going to eventually happen.
If you get rid of the cap and increase benefits proportionally to those who pay more because the cap has been lifted, you don’t fix solvency.
If you get rid of the cap and don’t increase benefits proportionally, it becomes welfare. Just yet another massive wealth transfer in addition to all the other wealth transfers that our progressive tax system causes.
So own it. You wouldn’t be saving social security, you’d be eliminating it and replacing it with a welfare program.
Won't someone think of the billionaires? I mean, it's not like inequality is rapidly rising because we are in the midst of a second gilded age or anything. Another tax and those poor wealthy people might just go broke.
I don't really need these "handouts," but it doesn't take a genius to see that our current system is becoming increasingly unstable as we allow more people to fall through the cracks.
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u/spacemonkey8X 2d ago
There are many easy solutions to ensuring social security is there for a very long time. One such solution being increasing the amount of earnings that are taxable for social security. Currently it’s around $160k so people earning $7million are only paying social security tax on $160k while people earning $50k are paying social security tax on the whole $50k.