Privatizing a portion of Social Security: Why are liberals happy with a Negative Return on their "investment"?

[The MobFather]

Starting now.. you will NOT get back what you paid in.

Today, you could open an annuity with guaranteed principal + guaranteed return with any insurance company and have a much better retirement that SS will ever give you.
2.5% Minimum Guaranteed.. OR.. -5%? And that is with rates at record lows ! The only place they can go is up !

If you wanted to be in the market... keep this in mind. The average return over ANY 30 year period is 10%

Washington -- People retiring today are part of the first generation of workers who have paid more in Social Security taxes during their careers than they will receive in benefits after they retire. It's a historic shift that will only get worse for future retirees, according to an analysis by The Associated Press.

http://www.syracuse.com/news/index.ssf/2...first.html
have you not noticed? 401k's recouped their losses by the middle of last year
Sorry Libs.. you know as much about Retirement planning as you do the Constitution.
SS IS A RISK ! You are LOSING YOUR MONEY !!! My God. ! Can you people read? You wont' get your money back !!!! lol
@Bruce.. do you know what a Pension is? They go out and buy an Annuity for you !!!!

[mommanuke]

How happy were the retirees in 2008 when the market crashed?

[IrateMenace991]

I agree. Privatizing and putting corporations in charge of healthcare is good becaus they always care about us first. FACT.

[Truth]

So far Social Security has paid every dime it has ever owed. Starting now... you are a complete idiot.

["The Sheep"]

A blind believe in government will make everything seems wonderful. LOL!

[kril_420]

The key word here is Security. With SS being the biggest part of many seniors' incomes, we shouldn't introduce additional financial risk into the program.

[Mr. Smartypants]

The money you pay into Social Security doesn't go into a drawer with your name on it. It goes to pay people who are already on Social Security, people who are receiving benefits now. If you remove a portion of it to invest in the name of future SS recipients, you have to make up that shortfall somehow. So how do you do it?

GW Bush, when talking about his idea of privatizing 1/6 of SS, never explained that. And I don't think anyone ever even asked him about it. I really would like to have heard what he would have said. My guess is that he would have pretended not to understand the question. (Actually he wouldn't have had to pretend.) Or he would have simply deflected the question and changed the subject.

Bush's plan was half-baked. He wanted it to be his signature achievement, but HIS OWN PARTY killed the plan because they knew how popular SS was, and that it would have cost them votes on both sides.

[brucec83]

That is a nice argument on paper, but there is no pile of cash out there for us to invest. Just a bunch of IOUs from the US Treasury.

Privatization is a code-word for eliminating the program. If privatized, the first major recession (or a stupid broker) would bankrupt it. Other countries have tried it and that is what happened. No sensible pension manager invests funds in equities to get the maximum return, Government bonds are the safest bet.

Social security is not really a pension plan, it is a tax and entitlement designed to provide a minimum amount that might prevent you from having to go on welfare. Paying in for 10 years entitles you to collect, but since courts have ruled that you have no property interest in your contributions, that payment can be raised, lowered or eliminated by any future Congress.

If you want higher returns, try an IRA.

[who is #1?]

http://caselaw.lp.findlaw.com/scripts/ge...&invol=603
It is not and never has been an "investment" or a trust fund. It has always been a tax on employment which goes into the general fund. The US Supreme Court says Social Security is a social welfare program which Congress may alter or abolish at will.

[brenton s]

"Washington -- People retiring today are part of the first generation of workers who have paid more in Social Security taxes during their careers than they will receive in benefits after they retire"

First you have misread the article. People retiring today do not have a negative return. They have a negative return relative to what they could have gotten from 401K type of savings account. This doesn't mean starting now. It means that starting 45 years ago Social Security was an ineffective retirement tool.

Second, you are comparing apples with oranges. A 401K is a savings vehicle - and useful for retirement planning. Social Security is a risk management vehicle. You can't get meaningful information looking at Social Security as a saving vehicle. A 401K allows you to save for retirement. Social Security is intended to provide supplemental income in case you live longer than your savings. You buy auto insurance, health insurance, and the like. Social Security is old age insurance.

Third, your point shouldn't be about returns. It needs to focus on the fact that the system has no reserves. People think that the Trust Fund is a reserve. The problem is that the system has made roughly 10 times the number of promises as it has assets. The problem isn't that Social Security return sucks (and it does). The problem is that people are counting on a system that is woefully underfunded.

This isn't a liberal or conservative issue. Younger Americans put 15% of their wages into a system that generates negative returns. These people will reach retirement in poverty. So Social Security is actually creating the poverty that it is suppose to alleviate.

http://www.FixSSNow.Org