im 36 will social security be available when I retire in 29 years. Why do all the pundits argue that these?

Question

benefits will be eroded by the aging baby boomer population.

Answer 1

HAD YOU BEEN ALLOWED TO INVEST THE SAME AMOUT OF MONEY THAT THE FEDERAL GOVERNMENT IS STEALING FROM YOU UNDER THE GUISE OF SOCIAL SECURITY - YOU WOULD BE A MILLIONAIRE AT 65.

I HAVE NEVER BEEN FOR SOCIAL SECURITY - IT IS BIG BROTHER TELLING US AMERICANS THAT WE ARE TOO STUPID TO DETERMINE WHAT WE SHOULD DO WITH OUR OWN MONEY.

YES IT WILL BE GONE BECAUSE THE POLITICIANS KEEP STEALING FROM THE POT FOR THEIR PERSONAL SPENDING.

Answer 2

You probably won't be retiring until you are 76 years old or so. Check the tables on SSA.gov for the estimated retirement date for someone your age. Basically, we are all expected to work until we drop dead.
And if you and your contemporaries,
(plus the youngsters coming up) continue to pay into the system you should be fine.
George Bush's plan was to raise money by privatizing the SSA , thus cleaning up some of National Debt in that arena.
Try a Google on the SSA building that Bush built in
Mexico City, DF, Mexico.
It will shock you.
What does Mexico City have to do with US Social Security?
Good question.

Answer 3

Its simple. Think of the population as a pyramid with different levels divided by age categories (ie: 0-9 9-15- 15-25... etc) at the top are the elderly. As long as there are more young people than old, more money is being pumped into the system that is being used. The baby boomer generation effectively flipped this pyramid upside down. Now there are going to be more elderly people than there are young people to support them. More money going out than coming in depletes the reserves and the entire system crashes unless it is somehow changed.

Answer 4

It's a very bad system.We would all retire rich if we put that same amount in a Private retirement fund.

Answer 5

Not one member of congress has come forward and discussed the real issue with Social Security. This is a moral issue which effects both the baby boom generation and the next generation of younger workers; and it can not be understood without a brief history lesson:

Until 1983, Social Security was a pay as you go system - a contract between generations, where the younger generation paid for the retirement of the previous generation. Although next to nothing was saved in the Social Security Trust fund, the system worked well - because as the wages of young workers increased with inflation, larger benefits could be paid to retired workers to protect of them from the effects of that inflation. But in 1983, Congress recognized that the retirement of the Baby Boom generation would put an unfair burden on the next (smaller) generation of workers unless changes were made to the system.

As a result of the massive 1983 reform package, the retirement age was scheduled to gradually be raised to 67 in order to account for longer life spans and social security taxes on wages were increased by about 1/3, in order to build up a real trust fund to help pay for the retirement of the baby boom generation. As a result, the trust fund has built up a surplus of over 2 trillion dollars - and the baby boomers became the first generation to pay for their parents' retirement while providing for their own as well. By one measure, the 1983 reform package has been wildly successful, as the surplus in the trust fund is now predicted to last at least until 2042, when the oldest baby boomers will be 96 years old if they are still alive. (Even then Social Security will not be broke - It will just have to go back to the old pay as you go system - which may not be much of a problem if the economy has done well and most of the baby boom generation is dead.)

President Bush's statement that the system will go completely broke in 2042 is simply stated, a lie. - So yes there will be something there when you reach retirement age.

Even the most pessimistic estimates say that the the system will be able to pay about 70% of promised benefits in 2042 with no changes. These estimates assume that the economy will grow much slower than it has in recent years and that life expectancies will continue to get longer. And nobody can really predict what things will be like 35 years from now. There is a reason that politicians like President Bush focus on 2042: - The law says thats that the social security trust fund can only be used to pay social security benefits. And the bonds in the trust fund are legally evidence of a debt. Nobody expects the government to default on the bonds so the President has to come up with an excuse to not pay them off on schedule. By convincing the public that the system will go bust in 2042, he has an excuse to cut benefits in order to build up a bigger trust that the government can borrow and not pay back.

When the social security reform legislation was signed into law by President Reagan on April 20, 1983, he said:

"We're entering an age when average Americans will live longer and live more productive lives. And these amendments adjust to that progress. The changes in this legislation will allow social security to age as gracefully as all of us hope to do ourselves, without becoming an overwhelming burden on generations still to come.

So, today we see an issue that once divided and frightened so many people now uniting us. Our elderly need no longer fear that the checks they depend on will be stopped or reduced.

These amendments protect them. Americans of middle age need no longer worry whether their career-long investment will pay off. These amendments guarantee it. And younger people can feel confident that social security will still be around when they need it to cushion their retirement." You can view President Reagan's complete speech here: http://www.youtube.com/watch?v=0-91W5LS0E8


In order for the 1983 reforms to work, congress and the president would have had to act responsibly and not treat the social security trust fund as if it contained free money that could be spent and never paid back. And early in his first term, President Reagan did promise to balance the Federal Budget by 1983.

The problem of course is that we have had an orgy of tax cutting that has primarily benefited the rich and massive budget deficits under the administrations of Reagan and Bush I and II. Because the baby boom generation has not yet started to retire, last year, congress was able to borrow and did borrow over 186 billion dollars from the social security trust fund (in addition the approximately two trillion dollars that have already been borrowed and spent), every penny of which was paid for by FICA taxes on the wages of working people - and congress has no plan in place to pay it back when it is needed to pay for the retirement of the baby boom generation.

This borrowing has masked the true size of the federal budget deficit. President Bush has stated that the fiscal 2006 budget deficit was 248 billion dollars.. But this figure does not include the 186 billion borrowed from the social security trust fund last year, nor does it include the approximately 100 billion dollars per year cost of the war. From Fiscal 2002 to Fiscal 2006, the Federal Government borrowed approximately 2.4 trillion dollars, including borrowing from social security trust fund. That 2.4 trillion dollars in borrowing means that from fiscal 2002 to fiscal 2006, approximately 1/4 of non social security government spending was financed with borrowed money. (See www.ctj.org/pdf/def0706.pdf)

The lowest paid minimum wage worker and a person making $97,500 per year pay social security (FICA) taxes at the same percentage rate. On wages over $97,500 workers only have to pay the relatively small portion of the tax that goes to support Medicare. The justification for this is that FICA taxes are like retirement savings.

When President Bush complained (in his 2005 State of the Union address) that in 2017, the trust fund will be paying out more than it takes in and when he calls the trust fund a "worthless bunch of IOU's," he is in effect asking for "debt relief." He wants to find a way to avoid repaying the debt to the trust fund so that he can preserve his 15% dividend and capital gains tax rates and his other tax breaks which primary benefit the rich.

It is true that the government bonds in the trust fund don't have economic value like a piece of real estate or stock in a corporation that pays dividends- but they have legal value (they represent a promise by the government to repay a loan when payment is due.) -

But more importantly, they have a great deal of moral value. The moral issue is: Is it right to borrow and spend somebody's retirement money and not pay it back. If the CEOs of a big corporation (like Enron or World Com) had taken all the money from their employees' pension plans and replaced it with a bunch of worthless stock or worthless IOUs, they would be headed to jail. - Moreover, is it right to keep collecting FICA taxes from workers at a rate that creates a surplus, if the government is going to keep up this borrowing and use it to finance tax cuts for the rich with no plans to pay the money back when it is needed to pay benefits? (In addition to the 2 trillion dollars of social security surplus already borrowed, the government plans to "borrow" more than 3 trillion dollars more of surplus before the well runs dry around 2018.)

In the alternative, is it right to maintain tax cuts for the rich and pay back the retirement money borrowed from the social security trust fund by passing the entire cost of doing so on to the next generation - something the 1983 reforms were intended to avoid?

My personal view is that we should immediately roll back all of the Bush Tax cuts, and then roll back every other tax cut for the rich that has been enacted since President Reagan until the operation of the government is fiscally sound. President Bush believes it is more important to maintain his tax cuts because they have a stimulative effect. - But crack cocaine also has a stimulative effect and that doesn't mean it is a good thing.

The Democrats may see things a little differently, but the new Democratic controlled congress has no plans to beginning discussing rolling back the Bush tax cuts. - In order to take the high moral ground Democrats must recognize that they had a hand in creating the big deficits of the past 23 years and they must be willing confront the real issue. Both parties have been buying our votes with borrowed money for far too long. But in any event, the press and politicians have an obligation to explain to the public that it is not social security but the rest of the government that needs reforming. Neither the Democrats nor the Press have done their job.