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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Road Walker who wrote (217609)	2/5/2005 11:31:24 AM
From: combjelly	Read Replies (1) \| Respond to of 1571405

"My concern is the debt that will be generated by the program, and the subsequent rise in interest rates and inflation and decrease in standard of living." And that should be at the center of the discussion. But, of course, that is not being addressed by the Administration at all. I suppose it is to be expected, but the press has been ignoring it also.

To: Road Walker who wrote (217609)	2/6/2005 5:42:10 PM
From: TimF	Read Replies (1) \| Respond to of 1571405

You would probably lose. I doubt it. I think its a near lock that I would win if you use nominal dollars, and I still probably would win (although it is not at all a lock) if you use inflation adjusted dollars. And he assumes a growth rate of 4.6%, which would take SS out of deficit. I think he assumes a real return on investment from private accounts of 4.6%, that doesn't mean the economy as a whole has to have that level of real growth. If the economy and wages do grow that rapidly then social security taxes will bring in a lot more, but as long as the outlays are indexed to wages spending should increase by a similar amount. In any whether social security goes in to a protracted deficit and spends all the trust fund money or not really isn't an issue. Too much will be spent on it whether or not the trust fund becomes exhausted. Its true that a real growth rate of 4.6% sustained over decades will make the burden more bearable but you will still have fewer workers supporting each retiree. Benefits will have to be cut one way or another. Most likely it won't be a direct cut, instead the indexing will change or the retirement age will be pushed back. If you don't do that than taxes will have to go to uncomfortably high levels to sustain social security and medicare spending. Medicate will probably be more of a problem than social security, unfortunately neither Bush nor anyone else seems to want to address it right now. Tim