What do you think will be the more likely "fix" for Social Security and Medicare?

Question

Though there are differnt estimates of exactly when it will happen, it is pretty much universally accepted that as the system stands now, both Social Security and Medicare will go bankrupt within the upcomming few decades as the babyboomers all retire. Some estimates show the required outlays for the two programs to equal the equivenlent of the entire federal budget at current growth rates. Obviously this cant happen.

So what do you think will be the more likely "fix"? Much higher taxes on the younger generation or drastic benifit cuts for the older generation?

Which one would you prefer to happen?

It is also likely that in order to take the tax approach, that so much money will be required, that it wont be able to be payed for by a few taxes on the "rich." It would likely require broad based taxation.

Answer 1

I really have no idea about medicare - however social security is a very easy "fix".

We just need to go back to its roots. You pay into the program and after you are ready to retire or are injured you get funds out of the program depending on how much you paid in.

We need to stop:

1. Paying children of old guys - if a 70 y/o gets a young girl pregnant, that child can get SS until they are out of high school. It used to be until they finished college. A college friend of mine got more then my old aunt who had paid into it all her life.

2. Giving non-working spouses from 33-50% of what the working spouse gets. Just because someonw CHOOSES to stay home (and it is a choice that mostly the well off choose) then they get money from SS without ever contributing anything.

3. Stop payment to older immigrants. Just because they are deemed too old to work when they come here does not mean we should have to fund their existance - let their family support them.

4. Most people on disability should find a job. Since welfare reform, the number of people on disabilty has skyrocketed (no end date like welfare). As a LEO I can tell you that most of the people I contact seem to state that they are disabled. Yet they have no problem pulling motors and trannys out of cars, or fighting with us.

If we stopped those people from collecting who have not paid into the system it would be in great shape forever!

Answer 2

There's no possibility of *bankruptcy* when the entity that owes the money decrees what its liability is. None of us would ever go bankrupt if we had THAT power. I tend more and more to see that language as counterproductive, though I understand the point of it. But there are no promises or contracts -- the government will still collect, borrow, and spend, and there will simply be changes in tax rates and in benefits as needed.

Forecasts for the cost of Medicare are unrealistic, so one way or another Medicare will simply be much less costly than anticipated. Ultimately, money pays for absolutely nothing except labor and returns to capital (since money is only paid to human beings), so in addition to possible limiting and rationing of care, clearly the labor will become much more productive that currently expected. Obviously so: we're not going to reach a point where one-half the population is old, and the other half of the population are health care workers tending the old people, which is what these forecast imply. Maybe the Japanese will perfect their robots.

Although I think social security is horribly unproductive and I'd like to begin privatizing it, even as is, all that's required for permanent maintenance is a reduction of benefits and a de-linking of contributions and benefits. I'd expect both to happen, followed by eventual privatization in the more enlightened future.

But I also expect both problems to be less bad than forecast, actually, as GDP growth and productivity growth will both exceed the rather dim expectations inherent in the official forecasts. Latest news after all is that the fertility rate in the U.S. now is actually increasing....

Answer 3

Even "Time" magazine referred to Social Security as an "insurance program", which I believe was the original intent.
Unfortunately, everyone now believes that if they "paid into it" they should get it back. That shouldn't be the case. If you were fortunate enough to generate wealth, establish assets, and retire comfortably, you should not be entitled to any Social Security benefits. Those benefits should only be available to legal U.S. citizens who are truly in need, and then only when their savings and most other assets are depleted.
I personally know spouses who have collected two Social Security checks for years, even though both spouses are independently wealthy. They own three homes, drive luxury cars, take exotic vacations, and earn handsome dividends from lavish investment portfolios. Yet they still think they're 'entitled' to a Social Security check!
These people paid car insurance for decades and hoped they never had to file a claim. They bought homeowners' insurance and never filed a claim. Why shouldn't it be the same with Social Security?

Of course, politicians are too cowardly to tackle this issue. Alexander Tyler once said, "A democracy cannot exist as a permanent form of government. It can only exist until the voters discover they can vote themselves largess from the public treasury. From that moment on, the majority always votes for the candidate promising them the most benefits from the public treasury, with the result that a democracy always collapses over lose fiscal policy followed by a dictatorship. The average age of the world's greatest civilizations has been 200 years."

We've voted ourselves right into bankruptcy...and into the complete collapse of the republic as we know it, all because we've allowed arrogance, ignorance, avarice and hubris to set in. -RKO- 12/21/07

Answer 4

Obviously when SS was enacted by FDR few Americans lived to the age of 65, so not many people actually collected it or didn't for very long.

Now people are easily living to 85 and can easily work until 75-80.

The solution is to increase the age where you can receive benefits to 75 or 80 (keep the standard retirement age to live on your own assets at 65 to make people happy).

The easy way to do it, is to phase it in slowly. So people who are 57-59 years old (for example) cannot collect until they are 65 1/2 years old.

55-57 at 66

53-55 at 66 1/2

and so forth and so on.

Answer 5

Let me ask you this.....lets say since you were a kid...you paid insurance....health, car, home......never put in a claim. Paid and paid and paid. During that time....someone "borrowed" all the time from those funds....promising to pay it back......covered and pledged money for things it wasn't intended for.....paid for people it was never intended for.......now something happens and you need it and they tell you, YOU are the REASON it's failing........what would you think? There wasn't a PROBLEM with it till people stuck their fingers in and took it for something else. Quit BLAMING the people who already PAID for it. THEY aren't the PROBLEM. They are filing for what they already paid for!!!!! You don't get medicare if you didn't pay in.

I say cut the PENSIONS for governmant employees. They didn't pay a dime for it.....most don't NEED it. Pay cuts for the over-inflated pay many of these people get. Remember how many people took pay cuts to keep a job? Or keep a business afloat?

The government is big on telling YOU to pay more or give up more. I say it's their turn!!!! They don't NEED 400 hair cuts on your dime. They don't NEED private jets and top of the line perks on YOUR dime. Most of these people are ALREADY rich as hell......they don't NEED it.

You can't ask a young person to pay MORE when they can't exist. You can't expect the elderly to do with less when they can't survive and have no means to do anything for themselves.

You can't expect people to invest in the future when "cheap labor" doesn't pay enough to exist let alone invest. You can't ask people to CUT when nothing is left. They have a really low quota to qualify for welfare. How about a quota at the top end? If you make X amount.....you don't get medicare....you don't get pensions. They keep taking from the people who can least afford it....not from those who can.

Drug companies spend a fortune on TV adds. Like you can really go in and tell your Dr. to GIVE it to you? Demand a surgery they advertise. Can it. Stop wasting that money when people have no say and cut their cost! I saw a cute commercial for Tide. Doing their thing to help people. How about not advertising, cutting your price, doing these "kind hearted things " on your CEO's bonus and stop nailing us!!!!!!

How about a tax freeze for seniors who own their property? Heck.....they've been paying taxes their whole life for their kids and not their kids or no kids. How about no taxes after 50? That tax money can go for retirement. Seriously......they say people are 1 month away from homelessness....they tell you to have in savings 6 months to cover expenses..........how do you "put away" 20 to 30 years of income then? People can't save for a darn vacation.......let alone retirement! Save for college and all the rest? And yet still improve your American way of life. Or right now.....just keep pace.....barring no problems....

What's worth more? A kid that's a vegetable since birth for 20 years with no hope, or an elderly one for 6 who has contributed their whole life?

There's tons of different avenues and a ton of tough questions. Seems like we're back to "only the strong and rich survive".

Answer 6

I think they will raise the income limits for collecting payroll SocSec taxes...

SocSec and Medicare will never go broke....too many people depend on it for their daily bread.

I also think they will eventually put a maximum limit on SocSec. If your retirement income is above a certain figure, you won't be eligible to collect SocSec. There is no reason why a gozillionaire needs to collect it.....

Answer 7

I doubt anyone is going to fix it, it seems to be the 3 rail and no one wants to go near it. They'll just keep raising rates.