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

To: Road Walker who wrote (225975)	3/23/2005 2:45:26 PM
From: TimF	Read Replies (2) \| Respond to of 1571940

Its not the complicated. If you can't understand that I'm not sure you can understand social security. Reduction in tax payments in to social security due to the creation of private accounts = "Transition Costs" or "TC" Reduction in benefits paid out by the government = "reduction of obligation" or "RO" Interest on the "transition costs" equals "Interest" or "I" RO > TC even if benefits are not cut by a larger percentage than the percentage that goes in to personal accounts (see siliconinvestor.com RO may be > TC + I, if interst rates remain low or moderate. We can't predict interest rates, and we can't predict future wages (which SS benefits are indexed against), so we can not predict the exact net costs of either Bush's idea or the current system. But for many reasonably possible combinations of interest rate and wage changes Bush's plan actually save money. (Which is just a different way of saying that its possible that RO > TC + I). Tim