This piece of common sense is so obvious that I'm pretty sure most
people assume it is already the law. It isn't: every
government and corporation should be required to set aside in an
independently managed fund all of the monies required to fully vest the
pension commitments of the organization. There. Simple.
Under no circumstances should the government or a corporation be allowed to
ever, ever touch that money.
I am aware of the fact that at the beginning
of Social Security, the government actually had to pay out to people who had
never contributed money it had never collected for the program.
Your are astonished? You mean they
don't have to? You mean the government can simply collect the
money required for these pensions and then spend as much of it as it wants
on other things-- like bizarre failed weapons systems or wars-- while promising that future governments will make up the difference?
And thus we have Illinois. And Republicans claiming-- it's an
outright lie-- that Social Security is unsustainable. In fact, there
is nothing more sustainable than Social Security, if the government would
simply pay it back for all the money it stole out of the system so that
Mitch McConnell could use it so he could claim to not raise taxes and
still-- miraculously-- spend more money on Homeland Security and the
military.
The Republicans act as if Social Security is funded by general revenue, so
you are not really entitled to it. But Social Security was not
instituted to fund general government programs. It was instituted
specifically to collect your contribution to your future retirement needs.
The U.S. government has been borrowing this money for years to fund other
government expenditures-- like the stealth bomber.
I suspect that a Republican government will try to find some way to keep the
revenue stream without keeping the benefit. That is what they do. A
tax on the working class with an upper ceiling is a Republican's wet dream.
2011-11-06
By the way, I'm not averse to the idea that the independence of pension
funds should go two ways. The rate at which employers and employees
contribute to the fund should be wisely and carefully crafted, and the
benefits received should also be wisely and carefully crafted and the
brains should carefully establish the correct rates and then it should all
be locked in.
That means that if inflation eats away at the value of those pensions, the
price of security is that they will not be adjusted beyond the rate fixed in
the original agreement. That means it could be adjusted, but only if
the possibility of it was factored into the original terms of the plan,
including the potential costs.
That means, yes, some pensioners might be disadvantaged by high inflation at
some point-- but I don't think that's an unreasonable price to pay for real
security. (I'm not going to go into it here, but people then also should
be aware of the government using inflation as a tool to reduce the real cost
of their obligations.)
Yeah, it's complicated.
Public schoolteachers in Illinois do not participate in Social Security, and their pension fund is in precarious
shape. Last year the fund reported having just 48 cents for every dollar of
benefits it had promised, largely because the state had failed to pay the
required amount of money into it for many years. NY Times, November 5,
2011
So Anthony Wiener has to resign his seat in Congress because
he hit on a few women he was not married to. So Herman Cain is toast
because of 15-year-old allegations. So Eliot Spitzer is out because of
a call girl. Did any of these gentlemen hurt anybody as much as the
state government of Illinois has hurt its public school teachers? So
Obama wears a flag pin in his lapel and the Republican candidates reverently
clasp their hands to their hearts during the singing of the national anthem.
So Kim Kardasian got divorced after 81 days of marriage.
It's not even
close. Not even in the same universe. How different is
your life going to be if you are going to get half of the pension you
expected, and which you paid for? How different is your life because
Anthony Wiener tweeted a picture of his underwear?
Yet Americans screamed
and jumped and screeched and wailed until Anthony Wiener resigned. Yet
the government of Illinois continues along blissfully oblivious to the
slightest opprobrium.
Rick Perry is half right in the way that only a
half-wit can be: it's a ponzi scheme in the sense that you start paying for
it at the beginning for those who are retiring at that time, and then, when
you retire, you collect... So, in theory, if the taxpayers decided to
stop paying into at a certain point in time, you get what happens with a
ponzi scheme: the money runs out.
So, if you think we will run out of
taxpayers in the future, vote for Rick Perry and he'll do his best to get
rid of Social Security. Then everyone can just put some money aside
every year, year after year, so that when they retire, they will have a few
hundred thousand dollars in the bank.
Uh huh.
There is nothing fiscally unsound about
social security and it would take the collapse of our entire economy to make it
fail. Or the massive stupidity of a lot of of legislators and the
shenanigans of investment brokers and managers.