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Solution to US debt crisis is severe austerity triggered by a fiscal calamity

fortune.com

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Re: Solution to US debt crisis is severe austerity triggered by a fiscal calamity

#81

Post by iamthemonster »

techgnosis wrote: post #58

The healthcare portions of the debt seem unsolvable but I don't know why we think Social Security is that complicated to fix. 1. Define very clearly what SS is. We need to be clear that it's an agreement between the working class and the retired class that says "if you are too old to work and you can't afford to live, we will take care of you" 2. Get rid of the SS tax cap. You don't pay any SS tax above 180k ish, whi…

I was interested to hear Trump mention Australia's retirement system the other day (amongst the endless stream of what he normally talks about, it really stood out).

In Australia you have a universal Age Pension which is a backstop against extreme hardship set at the equivalent of US$20.5k, but your rate of Age Pension reduces linearly with income levels between US$9k and US$44k.

Similarly, the rate of Age Pension reduces linearly with asset levels between US$213k and US$474k, but you don't count your own home in that.

The private retirement savings system is similar to the 401(k) and Roth 401(k) except the employer doesn't typically do a match, they are just legally obligated to pay 12% of your salary. You can then contribute an extra US$20k as an income tax reduction or pretty much however much you want after-tax.

Inside the superannuation system, the gains are only taxed at 15%.

In general, it's a pretty perfect system that just leans a little too far towards being a rich person's wealth preservation tool, but overall it enables self-sufficiency while also preventing real poverty in old age.

Re: Solution to US debt crisis is severe austerity triggered by a fiscal calamity

#83

Post by Libidinalecon »

akamaka wrote: post #52
whimsicalism wrote: post #31

Earlier quoted context omitted.

Share of budget is actually a terrible way to look at this because the budget itself has exploded, and that ratio hides most of the real modern risk. Interest costs in the 80s spiked because high rates were applied to a much smaller debt base. Today we have the opposite problem: rates that are high compared to the 2010s are now rolling onto a massively larger stock of debt. We’ve only just started to refinance that d…

If you compare government budget as share of GDP, you can see that is hasn’t “exploded”, outside of crisis periods. Current spending rate is elevated about 25% over the 1990s period of restraint, but quite close to the 1980s. https://fred.stlouisfed.org/series/FYONGDA188S

You know why Japan is fine with 236% debt to gdp?

Because measuring things against GDP like this is completely meaningless.

If you use your brain for even the slightest moment it would be completely obvious that the sum total amount of a debit is a huge deal because of scale of the interest.

Re: Solution to US debt crisis is severe austerity triggered by a fiscal calamity

#84

Post by Hammershaft »

creer wrote: post #78
Hammershaft wrote: post #65

Earlier quoted context omitted.

That R&D money to private space companies has lead to the biggest advances in space technology in our lifetimes.

And for very small amounts too (compared to the whole mess). Fantastic return (on that little bit, out of the whole mess). Same for medical research.

Yeah, estimates of returns on public science generally are dramatic.

Re: Solution to US debt crisis is severe austerity triggered by a fiscal calamity

#85

Post by ratelimitsteve »

Hammershaft wrote: post #65
ratelimitsteve wrote: post #32

lets do austerity for the wealthy first. we give them money hand over fist, in fact we've never met a problem we didn't try to solve by giving the rich more money. we currently fund R&D for three private space programs, from which we buy the technologies we paid the development costs for. Lets get down to 0 publicly-funded privately-owned space programs before we start picking which grandmothers we need to starve out

That R&D money to private space companies has lead to the biggest advances in space technology in our lifetimes.

that's great, but it's not an unqualified Good Thing(tm) when we're putting it up against meeting basic needs for people today. We managed to have amazing gains in technology and a functioning state that can care for its citizens in the 60s. Also, this doesn't imply that 3 publicly-funded privately-owned space programs are better than 1 publicly-funded, publicly-owned space program, only that research is good (which was never the issue at hand).

Re: Solution to US debt crisis is severe austerity triggered by a fiscal calamity

#86

Post by whimsicalism »

bdangubic wrote: post #80
whimsicalism wrote: post #70

Earlier quoted context omitted.

? the OP proposed raising the contribution limit & also hinted at some means testing "and you can't afford to live" -- which combined would absolutely be enough to close the gap depending on how aggressive you are with these changes.

I would let government decide “you cant afford to live” as much as I would let OJ Simpson date my daughter. but that would be a hoot as two parties controlling the government change. while one is in power, 99.99% of retirees would qualify, the other - 0.000065% :)

vacuous anti-government take that doesn’t really do anything to contribute to the discussion, imo. essentially “keep the government out of my social security!”

Re: Solution to US debt crisis is severe austerity triggered by a fiscal calamity

#87

Post by bdangubic »

whimsicalism wrote: post #86
bdangubic wrote: post #80

Earlier quoted context omitted.

I would let government decide “you cant afford to live” as much as I would let OJ Simpson date my daughter. but that would be a hoot as two parties controlling the government change. while one is in power, 99.99% of retirees would qualify, the other - 0.000065% :)

vacuous anti-government take that doesn’t really do anything to contribute to the discussion, imo. essentially “keep the government out of my social security!”

you have a comment to say what you don’t disagree with or just shooting the breeze?

Re: Solution to US debt crisis is severe austerity triggered by a fiscal calamity

#88

Post by Hammershaft »

ratelimitsteve wrote: post #85
Hammershaft wrote: post #65

Earlier quoted context omitted.

That R&D money to private space companies has lead to the biggest advances in space technology in our lifetimes.

that's great, but it's not an unqualified Good Thing(tm) when we're putting it up against meeting basic needs for people today. We managed to have amazing gains in technology and a functioning state that can care for its citizens in the 60s. Also, this doesn't imply that 3 publicly-funded privately-owned space programs are better than 1 publicly-funded, publicly-owned space program, only that research is good (which…

We had significantly less welfare in the 60s. We also had more poverty per capita in the 60s but living standards were rising as a result of technological improvements. Clearly a private space company (spaceX) has dramatically outperformed our public space company at advancing technology, despite being a scrappy startup with a fraction of the funding 20 years ago.

Re: Solution to US debt crisis is severe austerity triggered by a fiscal calamity

#89

Post by techgnosis »

ta9000 wrote: post #76
tzs wrote: post #74

Earlier quoted context omitted.

#2 is popular, according to polling. See [1][2]. [1] https://www.aarp.org/social-security/survey-raising-taxes/ [2] https://www.nasi.org/wp-content/uploads/2025/01/NASI_SocialS...

Of course it is, most people like to tax others to pay for their own benefits. Almost no one in the US maxes out the cap, so for them it would make no difference.

SS tax is a flat rate. I'm not asking the rich to pay more than anyone else. I'm asking that the rich pay the SS tax on every dollar they make, just like most people do.
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