Social Security says system's costs will exceed income this year • Hacker News Board

Re: Social Security says system's costs will exceed income this year

#21

Post by imbokodo » Wed, Jun 06, 2018, 9:46 PM UTC

Congress repealed the creation of the Independent Payment Advisory Board, that would cut the cost of Medicare without cutting service much. Thus Medicare costs are higher, thus spending exceeds income. Reinstate this board, as well as some other measures, and it will be back on target.

It is a manufactured problem. Anything benefiting the taxpayer like Social Security or schools is always being cut, while the funds to move the US embassy to Jerusalem or send the Navy to the South China Sea seems to be bottomless.

Re: Social Security says system's costs will exceed income this year

#22

Post by lev99 » Wed, Jun 06, 2018, 9:50 PM UTC

encoderer wrote: post #7

gringoDan wrote: post #5

We've known this was coming for a long time...as a Millennial, I don't expect to ever see a cent of Social Security benefits.

As a millennial, I do. There are just too many easy mitigations here that will extend life several decades: - Remove the cap and tax income above $120k, just like medicare and income tax - Increased tax rate, possibly just on payroll not income (the employer-paid portion) - Limited forms of means-testing (Maybe, attenuated survivor benefits as your estate value clears a certain high mark like $3 million) - Eliminate…

> - Eliminate "early" retirement ages and force the "full" age

I'd really be interested in seeing the math on this. If a person retires 2 years early (receive 86% of benefits) that person's total social security withdraw should be equal to someone that retired at normal age 13 years after retirement. With a retirement age of 67 and considering a life expectancy of 80, retiring early looks like favors the goverment on average.

There are additional factors to consider:

* How much more a person will pay into social security while continuing to work longer.

* If the last two years are the highest earning then it can increase the base payout.

* Does retirement age have an impact of life expectancy?

* Does a person's current health have an impact of if they decide to draw early?

* I don't really know how inflation changes social security, but it seems relevant to consider.

Re: Social Security says system's costs will exceed income this year

#23

Post by assblaster » Wed, Jun 06, 2018, 9:57 PM UTC

imbokodo wrote: post #21

Congress repealed the creation of the Independent Payment Advisory Board, that would cut the cost of Medicare without cutting service much. Thus Medicare costs are higher, thus spending exceeds income. Reinstate this board, as well as some other measures, and it will be back on target. It is a manufactured problem. Anything benefiting the taxpayer like Social Security or schools is always being cut, while the funds t…

>Congress repealed the creation of the Independent Payment Advisory Board, that would cut the cost of Medicare without cutting service much.

Medicare services are already being rationed covertly via wait lists and via the increasing numbers of physicians who refuse to take Medicare or Medicaid.

The IPAB would most likely decrease access to services by cutting payments even further below market rates which would decrease supply of those services.

Re: Social Security says system's costs will exceed income this year

#24

Post by Avshalom » Wed, Jun 06, 2018, 9:58 PM UTC

dopamean wrote: post #16

eropple wrote: post #8

Earlier quoted context omitted.

As a Millenial who tries to not hot-take, I do expect to receive Social Security benefits. I'm not planning on it being a requirement to survive, but I am expecting it to be there in a nontrivial form. As is widely noted the trust funds will, at current projected rates of usage, be tapped in 2034, but projected income (hence the "further looting" part) covers around 75% of all benefits at that point. Baby Boomers wil…

It's not a hot take to think that an unsustainable service that many members of government have campaigned on reducing or eliminating entirely wont exist in 30+ years.

While the exact current level of service might be unsustainable, some level of is completely sustainable as long as either: the working population grows OR the wages (under the cap) grow OR the cap grows OR the tax rate grows OR the things the fund is invested in grows.

Re: Social Security says system's costs will exceed income this year

#25

Post by rayiner » Wed, Jun 06, 2018, 10:00 PM UTC

gringoDan wrote: post #5

We've known this was coming for a long time...as a Millennial, I don't expect to ever see a cent of Social Security benefits.

I'm not sure why millenials have to worry about it. Social Security is not an aquifer that will be tapped out by the time we get to it. It is a pay-as-you-go system. The current crunch is coming from having a large retiring generation (the baby boomers), supported by relatively smaller working generations. Millenials will not necessarily have the same problems (unless the elect to have even fewer kids than baby boomers did, which is a possibility).

Re: Social Security says system's costs will exceed income this year

#26

Post by [deleted] » Wed, Jun 06, 2018, 10:02 PM UTC

rayiner wrote: post #25

gringoDan wrote: post #5

We've known this was coming for a long time...as a Millennial, I don't expect to ever see a cent of Social Security benefits.

I'm not sure why millenials have to worry about it. Social Security is not an aquifer that will be tapped out by the time we get to it. It is a pay-as-you-go system. The current crunch is coming from having a large retiring generation (the baby boomers), supported by relatively smaller working generations. Millenials will not necessarily have the same problems (unless the elect to have even fewer kids than baby boome…

[deleted]

Re: Social Security says system's costs will exceed income this year

#27

Post by jeffreyrogers » Wed, Jun 06, 2018, 10:02 PM UTC

rayiner wrote: post #25

gringoDan wrote: post #5

We've known this was coming for a long time...as a Millennial, I don't expect to ever see a cent of Social Security benefits.

I'm not sure why millenials have to worry about it. Social Security is not an aquifer that will be tapped out by the time we get to it. It is a pay-as-you-go system. The current crunch is coming from having a large retiring generation (the baby boomers), supported by relatively smaller working generations. Millenials will not necessarily have the same problems (unless the elect to have even fewer kids than baby boome…

Total fertility rate has been pretty flat for several decades now in the US and I believe is declining if you don't include immigrants, so I expect the problems with social security to continue into the future.

Re: Social Security says system's costs will exceed income this year

#28

Post by [deleted] » Wed, Jun 06, 2018, 10:03 PM UTC

jeffreyrogers wrote: post #27

rayiner wrote: post #25

Earlier quoted context omitted.

I'm not sure why millenials have to worry about it. Social Security is not an aquifer that will be tapped out by the time we get to it. It is a pay-as-you-go system. The current crunch is coming from having a large retiring generation (the baby boomers), supported by relatively smaller working generations. Millenials will not necessarily have the same problems (unless the elect to have even fewer kids than baby boome…

Total fertility rate has been pretty flat for several decades now in the US and I believe is declining if you don't include immigrants, so I expect the problems with social security to continue into the future.

[deleted]

Re: Social Security says system's costs will exceed income this year

#29

Post by jeffreyrogers » Wed, Jun 06, 2018, 10:05 PM UTC

cnorgate wrote: post #13

gringoDan wrote: post #5

We've known this was coming for a long time...as a Millennial, I don't expect to ever see a cent of Social Security benefits.

Social security will always be around in one form or another. Despite the fact that many Americans detest the idea of a welfare state, we're still collectively bright enough to realize that you can't simply leave no options for the sick, poor, and disabled. The better question to ask is whether you will be happy living out the twilight of your life on a government controlled amount of money. This amount will likely a…

The US is already a welfare state, we're just worse at it than other countries.

In any case, if you are young and aren't happy living out your life on whatever social security pays there is a simple solution: pretend like it doesn't exist and plan accordingly.

Re: Social Security says system's costs will exceed income this year

#30

Post by vannevar » Wed, Jun 06, 2018, 10:09 PM UTC

There are two problems with SS, one fixable, one less so. The hard to fix problem is slowing population growth. SS depends on young workers to fund the payments to retirees. But this is really only a problem if aggregate income growth declines with population growth, and it hasn't; the aggregate income of all Americans has quadrupled since 1982, the last time this shortfall occurred. The problem is that the vast majority of the income growth has been captured by a small portion of the population, who don't pay withholding taxes on it. If we had sane progressive tax policy in the US, the SS shortfall would evaporate.