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Is this the reason why Bush wanted to "Privatize" Social Security? - Fedup Veteran - 10-13-2012 01:30 PM
With the market bottoming out, it really makes you wonder why Bush was pushing so hard to put Social Security in the stock market like he was wanting to do.
Was it a way to get more from the working class people?
- proudbeam306 - 10-13-2012 01:38 PM
It was not a forced plan. It simply gave people an option of what they wanted to do with their money. They could choose to invest all, part, none.
- KnoxLen - 10-13-2012 01:38 PM
It was a way to GIVE more to the working class people. With public social security you have 30 to 1 ratio almost, by the time the younger generation is old enough to get social security I wouldn't be surprised if that number went up significantly. With private SS you're responsible for your own retirement. Now with the market down so much I would be surprised if the next administration does not completely fix SS.
- YeeeHaaaa - 10-13-2012 01:38 PM
I actually supported that idea. Shows you how much I know.
- Red Rubber Jesus - 10-13-2012 01:38 PM
The idea is to turn you into a slave.
Get you in debt, keep you there and take everything you can earn to service that debt and to try and survive.
Bush supporters and republicans in general cannot seem to grasp this simple truth. It is obvious to anyone who can see.
- Bob - 10-13-2012 01:38 PM
No. Bush wanted to privatize social security to
1) give you direct control of your retirement dollars similar to how you have control of a 401K plan. You can also pass your earnings onto your children. It is your money that they take from your paycheck, why shouldn't you have control over it?
2) keep the money out of the general fund so that politicians don't blow it on pork projects.
Two very good reasons to me.
- pastor of muppets - 10-13-2012 01:38 PM
So true.
I think this might be the only case where President Bush's failure actually helped us out.
- jack b - 10-13-2012 01:38 PM
Great question. Imagine if his scheme had succeeded in sucking all that money from the pockets of average Americans?
Someone once said, "nobody ever went broke underestimating the intelligence of Americans".
The government, through programs like Social Security, HAS to protect us from ourselves.
- gabriel bell - 10-13-2012 01:38 PM
well the deadbeat mortgagers blew 3/4 of what republicans and democrats sent away to a strange desert land so you both look guilty too me.
- BabbleOn - 10-13-2012 01:38 PM
Your 401(K) plan is actually a privatization of the "defined benefit plan" type of guaranteed pension that, for instance Postal Workers and other people working for the U.S. Government receive, and which was the primary retirement plan for most workers up until the present times. It's useful to think of the present Social Security Plan as a "Defined Benefit" type of plan, and Sen. McCain's Proposed Social Security Plan as a "Defined Contribution" type of plan.
Defined Contribution Plan
A defined contribution plan provides an individual account for each participant. The benefits are based on the amount contributed into the plan and are also affected by income, expenses, gains and loses. There are no promises of a set monthly benefit at retirement. Some examples of defined contribution plans include 401(k) plans, 403(b) plans, employee stock ownership plans and profit sharing plans.
Advantages of Defined Contribution Plans
Tax deferred retirement savings medium
Participants usually have a say in how much they choose to save
Can be funded through payroll deductions
Lump sum distributions may be eligible for special 10 year averaging
Participants can benefit from good investment results
Easily understood by participants
Disadvantages of Defined Contribution Plans
Difficult to build a fund for those who enter late in life
Participants bear investment risk (Think Enron)
Defined Benefit Plan
A defined benefit plan promises the participant a specific monthly benefit at retirement and may state this as an exact dollar amount. Monthly benefits could also be calculated through a formula that considers a participants salary and service. Unlike defined contribution plans, the participant is not required to make investment decisions. A defined benefit plan is sometimes referred to as a fully funded pension plan.
Advantages of Defined Benefit Plans
Guaranteed retirement income security for workers
No investment risk to participants
Cost of living adjustments
Not dependant on the participant's ability to save
Disadvantages of Defined Benefit Plans
Difficult to understand by participant
Not beneficial to employees who leave before retirement
More and more employers are moving away from defined benefit plans in favor of the defined contribution plan. Defined benefit plans are complex and very costly for the employer to maintain. The employer must maintain an account for the plan and decide the investments to keep the account growing. A defined contribuition plan requires quite a bit of management by both the employer and the employee but is less costly to the employer in the long run. By choosing a defined contribution plan, the employer puts the responsibility of investing in the hands of the employee.