>> will continue to pay out at 75% from the existing revenue stream. All it takes to make it "solvent" for 75 years + is removing the cap on earnings.
1. That may be true, but there is the question of lifespan left unanswered. Actuarial models do not take into account the problem of the rate of increase in human lifespans. Before that 75 years is up we could well be seeing life expectancy of 100 years plus, which will totally wreck the model.
2. Ignoring #1 above, you expect today's children to pay into this system their entire lives to have NOTHING LEFT when they reach retirement age?
3. What are you going to do about Medicare and Obamacare subsidies, the other two HUGE problems, one which is many times the size and scope of the SS problem for which you would effectively increase taxes by 15% on earnings above the wage cap? (There is also the public sector pension problem, which when included puts our unfunded liabilities well above 100 Trillion).
The bottom line is that you don't design these kinds of benefits around a 75-year planning horizon. That is an absolute fallacy in the methodology you and others who don't understand it want to apply.
>> No, you don't; you just have to come up with all $50T before the last payment comes due.
That is not correct. Unfunded obligations are stated at present value:
"Through the end of 2087, the combined funds [OASI and DI] have a present-value unfunded obligation of $9.6 trillion.” That is “$1.0 trillion more than the measured level of $8.6 trillion a year ago,” states the report, in reference to the data available for 2011"
Do you even know what is meant by "present value"? I'm guessing you don't, so I'll restate it: Present value means that you need 9.6 Trillion TODAY for it to grow to the stated levels. If you don't deposit 9.6T into the trust TODAY, the shortfall increases next year, subject to economic fluctuations.
I'm confident you and Bernie Sanders could use the rest of your lives to ponder this issue and still wouldn't understand it. |
