From an op ed piece in the Washington Post by Senators Bill Cassidy (R-LA) and Tim Kaine (D-VV):
… We propose creating an additional investment fund — in parallel to the trust fund, not replacing it — that would be invested in stocks, bonds and other investments that generate a higher rate of return, helping keep the program from running dry.
We estimate that it would take a $1.5 trillion up-front investment into the fund to get it going, and we propose giving the fund 75 years to grow. The Treasury would temporarily shoulder the burden of providing benefits to Social Security beneficiaries — but when the new fund’s 75 years are up, it would pay the Treasury back and supplement payroll taxes to help fill the future gap.
The result? The consistent delivery of Social Security benefits for generations of Americans, and a reduction to the United States’ long-term indebtedness by up to 20 percent. …
23 comments:
Actually a great idea.
I would like to see unbiased projections of how much that investment will grow. Why 75 years?
The Disneyland stock market approach. The remedy is to eliminate the cap and not let Wall Street destroy the trust fund.
higher rate of return, helping keep the program from running dry.
“Past performance is no guarantee of future results" is generally treated as a warning label: Don't assume an investment will continue to do well in the future simply because it's done well in the past. "Past performance is no guarantee of future results."
How does Crypto sound if lawmakers are going Vegas style?
Stocks go down too! If the govt would have stopped stealing from the Trust it would have worked for nearly forever, what do you think the elites will do with this money! Wars and gambling
That’s not accurate. The government has never stolen money from the trust funds. It’s true that when the trust fund was growing, its net income partially masked the size of the non Social Security budget deficits, but the money wasn’t taken.
Instead, the government converted cash income of the trust fund to bonds when the trust funds had met positive income, and has been redeeming those bonds (with interest) for cash when the trust funds have had to be tapped to pay benefits.
But that’s not the way it works,” Bush said. “There is no trust ‘fund’ — just IOUs that I saw firsthand,” Bush said.
Earlier, Susan Chapman of the Office of Public Debt Accounting had shown Bush an ivory four-drawer filing cabinet with numeric locks. “This is it,” she said.
“This is what exists,” Bush said, illustrating his point that the promise of future Social Security benefits are simply stashed in a file.
Anything other than "let's raise taxes" is a no-go for a certain segment of the country.
I’m glad you got the Republican talking point.
This administration is looking for a Bernie Madoff type to run this type of agency.
Because 75 years is far enough away that the vast majority of people living now won't be alive to see that time. That far away it doesn't matter. It'll be someone else's problem by then and we'll have gotten ours...supposedly.
Scrap the cap.
This should have been done decades ago. It blows my mind that people think this is a crazy idea. Sure the stock market goes down, and it always goes back up. It is like government workers putting all of their TSP money in the G fund. I guess some folks are super paranoid but that is just throwing money away. The Dow was around 700 when I first started putting money into it. Now it’s over 44,000. I know the posts are coming about the ‘evil’ people on Wall Street getting rich. The fact is, if you want someone to invest your money, you gotta pay them. Still come out way ahead.
The legislators know that the trust fund will have to cut benefits much sooner than anticipated so they trot out this dog and pony show to give the impression they are doing something.
Many condo homeowners in Florida felt the same way about paying paying rent and now they are underwater.
How did the Bitcoin experiment work out in El Salvador?
Sure...give it to Wall Street and let them steal the Trust Fund!
Wall Street has no waste, fraud and abuse.
Not mentioned in the op Ed are other alternatives - Senator Sanders, Warren and Hoyle have proposed the S393 SSA Expansion Act. The legislation would expand Social Security benefits by $2,400 a year and ensure Social Security is fully funded for the next 75 years by applying the Social Security payroll tax on all income above $250,000. Importantly, this legislation would not raise taxes by one penny on the over 91 percent of American households who make $250,000 or less.
And if Congress would eliminate the provision that Medicare can not negotiate prices on ALL drugs with Big Pharma then Medicare's shortfall would be greatly reduced.
A National Thrift Savings Plan modeled after the Federal Employee Thrift Savings Plan is a great idea but not a substitute for Social Security Benefits.
"I'll gladly pay you Tuesday for a hamburger today!"
Always worked for Wimpy, but not so much in the real world....
Actually, until Ronald Reagan and his idiot GOP successors sacrificed America on the altar of greed, wage and population growth far outpaced the rate and reliability of Wall Street’s annual gains. So the initial model was plenty brilliant.
Bitcoin just hit a record high at $112,000. So I’d say it’s going really well.
amazing how people who hate socialism are excited about the government making such an enormous investment into private corporations. how will the government vote on shareholder resolutions? who will decide what stocks/bonds/"other investments" (trump coins or other crypto? real estate? commodities?) to buy and how to avoid massive conflicts of interest?
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