John,
"Pyramid scheme" is a cute negative phrase, but doesn't describe SS. Sometimes (as now) it is over-funded, sometimes it is under-funded, depending on demographics.
It is kind of sad how the Dems have managed to manipulate the least knowledgeable among us (you). Over-funded? I am not sure if I should laugh or cry.
"Unfunded"? More exaggeration, of course. I read somewhere that it would take dumping less than 1/3 of the Bush tax cuts, if they were targeted to SS, to "fix" the system.
I think you need different reading from your current reading list. Here are some tips:
- Arithmetics
- Algebra
- Calculus
As far as understanding "funded" or "unfunded", funded means that you don't have to put in an extra dollar, and all the obligations will be paid out from the assets of the pension system. SS started as an unfunded system from day 1. The current unfunded obligations are in 10s of trillions of dollars, a multiple of officially recognized debt.
And how does the Bush proposal "fix" the "pyramid scheme"?.
There are countries out there with a lot more modest means that are managing to free themselves from the death spiral of the SS-like pyramid scheme.
Presumably 80% of funds would still go into SS and benefits would be reduced by 20%. Plus you add a few $Trillion (with a "T") to the national debt.
It's not adding anything. It is just recognizing the obligations that started with the original sin - FDR's creation of SS. The more we postpone it, the more severe the consequences will be.
The first step, IMO, should be recognizing what kind of pickle we are in, how much of the unfunded liabilities have accumulated from FDR until today. This should be done using sound accounting and actuarial methods.
Most people (you are a good example) have no clue about any of this. Once the problem is recognized, a more rational discussion can take place.
Joe |
