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

#31

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

assblaster wrote: post #23

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Congress repealed the creation of the Independent Payment Advisory Board, that would cut the cost of Medicare without cutting service much.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Congress repealed the creation of the Independent Payment Advisory Board, that would cut the cost of Medicare without cutting service much.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

Market rates are inflated due to lack of price controls in programs like Medicare and Medicaid, plus employer-sponsored insurance plans are not as incentivized to negotiate for lower prices as individual consumers are.

Couple that with the supply side problems where doctors need 7+ years of training before they can perform simple procedures like testing for strep throat or prescribing antibiotics, and the fact that a large fraction of medical spending does very little to prolong life or improve quality of life and you can see that the current health care system is incredibly wasteful.

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

#32

Post by rayiner » Wed, Jun 06, 2018, 10:13 PM UTC

vannevar wrote: post #30

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 majo…

> If we had sane progressive tax policy in the US, the SS shortfall would evaporate.

Our tax policy is among the most progressive in the developed world: https://www.theatlantic.com/business/archive/2012/02/us-taxe....

The real problem is that the average income earner doesn't pay enough Social Security taxes to cover what they will receive in benefits: http://www.politifact.com/truth-o-meter/article/2013/feb/01/.... The system is set up so not only do the needy get a public subsidy, but most people do.

Caps on retirement taxes are not specific to the U.S. Germany and France, for example, have similar ceilings. Germany, for example, has a 19.6% payroll tax up to $80,000. The U.S. tax is 12.4% up to $127,000.

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

#33

Post by mcthorogood » Wed, Jun 06, 2018, 10:16 PM UTC

Some comments by millenials say that they expect to receive SS benefits, but this is not a secure basis for financial planning. A person's retirement planning should be independent of any expected SS receipts and if you happen to receive SS then it's just a windfall.

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

#34

Post by dlhavema » Wed, Jun 06, 2018, 10:16 PM UTC

assblaster wrote: post #23

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 decre…

>and via the decreasing numbers of physicians who refuse to take Medicare or Medicaid.

do you mean "increasing number of physicians"?

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

#35

Post by ryandrake » Wed, Jun 06, 2018, 10:16 PM UTC

maerF0x0 wrote: post #20

encoderer wrote: post #7

Earlier quoted context omitted.

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…

means testing is super unfair to those who sacrificed lifestyle in their youth to save for retirement. Consider the person that could have, but didnt, live a lavish lifestyle and instead responsibly saved. Then a benefit (which they paid into, and maybe rely upon) is removed after the fact? Bad news.

Unfairness is arguably in the eye of the beholder. If someone “responsibly saved” then they are not relying on the benefit as much as someone who didn’t or couldn’t save. Is it fair that a person who does not need financial aid receives it anyway?

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

#36

Post by chiefalchemist » Wed, Jun 06, 2018, 10:23 PM UTC

We have the resources. What we lack are necessary priorities and the resolve to fix them.

The latest DoD budget is $700 billion. Russia's DoD budget is approx 10% of that. That's not a typo 10%. China might not be an ally - in the historical European sense - but given our symbiotic economic relationship it would like take quite a bit for a true military conflict to break out between the two countries.

Even if our DoD budget was 2x Russia's, the ~$550+ billion is still a lot of money. Money cant love, nor evidently priorities rooted in the 21st century.

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

#37

Post by assblaster » Wed, Jun 06, 2018, 10:25 PM UTC

jeffreyrogers wrote: post #31

assblaster wrote: post #23

Earlier quoted context omitted.

>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 decre…

Market rates are inflated due to lack of price controls in programs like Medicare and Medicaid, plus employer-sponsored insurance plans are not as incentivized to negotiate for lower prices as individual consumers are. Couple that with the supply side problems where doctors need 7+ years of training before they can perform simple procedures like testing for strep throat or prescribing antibiotics, and the fact that a…

Medicare and Medicaid are the definition of price controls for paying physicians: they pay below market rate such that private insurance is billed higher to offset. There are week price controls for medical equipment and pharmaceuticals and the failure to address overuse of unnecessary equipment costs way more than the savings from price controls.

Testing for strep and prescribing antibiotics represent the smallest fraction of healthcare resources. Why didn't you include brain or spine surgery on your list of things that shouldn't require 7 years of training? Expensive end of life care isn't the fault of hospitals or clinicians: it's the fault of families who can't say no to excessive and futile end of life care.

If you want to get into getting rid of "wasteful" spending, why aren't you recommending everyone should smoke a pack of cigarettes per day? Most people would work and live a productive life until they die of lung cancer at age 65? Saves 15-25 years of unnecessary "end of life" care.

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

#38

Post by assblaster » Wed, Jun 06, 2018, 10:25 PM UTC

dlhavema wrote: post #34

assblaster wrote: post #23

Earlier quoted context omitted.

>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 decre…

>and via the decreasing numbers of physicians who refuse to take Medicare or Medicaid. do you mean "increasing number of physicians"?

Yes, you're right, I wrote it incorrectly.

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

#39

Post by chiefalchemist » Wed, Jun 06, 2018, 10:26 PM UTC

vannevar wrote: post #30

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 majo…

I said this above as well, but our latest DoD budget is $700,000,000,000.

I agree with the crux of your analysis. But I also think we literally can't afford to ignore how $700 billion contributes to a multitude of our problems.

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

#40

Post by kingbirdy » Wed, Jun 06, 2018, 10:27 PM UTC

ryandrake wrote: post #35

maerF0x0 wrote: post #20

Earlier quoted context omitted.

means testing is super unfair to those who sacrificed lifestyle in their youth to save for retirement. Consider the person that could have, but didnt, live a lavish lifestyle and instead responsibly saved. Then a benefit (which they paid into, and maybe rely upon) is removed after the fact? Bad news.

Unfairness is arguably in the eye of the beholder. If someone “responsibly saved” then they are not relying on the benefit as much as someone who didn’t or couldn’t save. Is it fair that a person who does not need financial aid receives it anyway?

But this then incentivizes people to not save and spend their money while young instead, on the assumption that social security will help them when they're old, leading to even larger burdens on the system.