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Off topic thread for Maxwell...

By mrafrohead ·
Maxwell, you're a history buff, so I wanted to post a few things to see if you have heard of these.

It's from an e-mail that was sent my way today, and it got me thinking and pondering, and then it dawned on me that you would probably know if it's "the truth" or not. :)

Here it is:

SOCIAL SECURITY:

Franklin Roosevelt, a Democrat, introduced the Social Security (FICA) Program. He promised:

1.) That participation in the Program would be completely voluntary,

2.) That the participants would only have to pay 1% of the first $1,400 of their annual incomes into the Program,

3.) That the money the participants elected to put into the Program would be deductible from their income for tax purposes each year,

4.) That the money the participants put into the independent "Trust Fund" rather than into the General operating fund, and therefore, would only be used to fund the Social Security Retirement Program, and no other Government program, and,

5.) That the annuity payments to the retirees would never be taxed as income.

Since many of us have paid into FICA for years and are now receiving a Social Security check every month -- and then finding that we are getting taxed on 85% of the money we paid to the Federal government to "put away," you may be interested in the following:

Q: Which Political Party took Social Security from the independent "Trust" fund and put it into the General fund so that Congress could spend it?

A: It was Lyndon Johnson and the Democratically-controlled House and Senate.

Q: Which Political Party eliminated the income tax deduction for Social Security (FICA) withholding?

A: The Democratic Party.

Q: Which Political Party started taxing Social Security annuities?

A: The Democratic Party, with Al Gore casting the "tie-breaking" deciding vote as President of the Senate, while he was Vice President of the U.S.

Q: Which Political Party decided to start giving annuity payments to immigrants?

A: That's right! Jimmy Carter and the Democratic Party. Immigrants moved into this country, and at age 65, began to receive SSI Social Security payments! The Democratic Party gave these payments to them, even though they never paid a dime into it!

Then, after doing all this lying and thieving and violation of the original contract (FICA), the Democrats turn around and tell you that the Republicans want to take your Social Security away!

And the worst part about it is, uninformed citizens believe it!

Perhaps we are asking the wrong questions during this 2004 election year!

If enough people receive this, maybe a seed of awareness will be planted and maybe good changes will evolve.

How many people can YOU send this to?

Keep this going clear up through the 2004 election!! We need to be heard

End e-mail.

Thanks, I look forward to your and anyone else that wants to respond, responses. That is if y'all want to respond. ;p

Mrafrohead

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Another Social Security chain email

by TheChas In reply to Off topic thread for Maxw ...

Here is the text of an email I received today.

Subject: Keep this going

Keep this going till 2004 election

GET A BILL STARTED TO PLACE ALL POLITICIANS ON SOC. SEC.

2004 Election Issue!!

This must be an issue in "2004". Please! Keep it going.

Social Security could be very good if only one small change were made.

That change would be to jerk the Golden Fleece Retirement Plan from under the Senators and Congressmen. Put them into the Social Security plan with the rest of us ... then sit back and watch how fast they would fix it.

If enough people receive this, maybe a seed of awareness will be planted and maybe good changes will evolve.

How many people can YOU send this to?

Keep this going clear up thru the 2004 election!! We need to be heard


Chas

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My suggestions to "control" politicians

by TheChas In reply to Another Social Security c ...

While I saw the above email as a whimsical idea, I do have a few ideas that I think could keep our politicians from being as concerned as they are with special interests.

1. Eliminate voted on pay raises for ALL elected officials.
Set up a plan that pays elected officials a, henceforth, fixed multiple of the after tax median per capita income.
This gives politicians an incentive to reduce taxes for the average worker. And, to improve the climate for businesses.

Oh, anyone on public assistance or unemployment counts as having ZERO before tax income!

2. Similarly, the health care plan for elected officials will have the same benefits and contributions as the average US citizen.

3. Retirement plans:
I am flabbergasted at the retirement benefits my state lawmakers can earn with as little as 10 years in office.
Again, public servant retirement plans should not be significantly better than available to the average citizen.
At a minimum, elected officials should not get better retirement benefits than our armed forces.

4. Taxes:
Any benefit or retirement plan taxes MUST apply equally to our elected officials.

I'm sure that some of you will have some more ideas to add to this list.

Chas

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Start saving your money - a lot of it

by maxwell edison In reply to Off topic thread for Maxw ...

.
Here's what I know:

In 1936, a government pamphlet on Social Security said, "After the first 3 years -- that is to say, beginning in 1940 -- you will pay, and your employer will pay, 1.5 cents for each dollar you earn, up to $3,000 a year. ... Beginning in 1943, you will pay 2 cents, and so will your employer, for every dollar you earn for the next 3 years. ... And finally, beginning in 1949, 12 years from now, you and your employer will each pay 3 cents on each dollar you earn, up to $3,000 a year. That is the most you will ever pay."

Yea, right. This year, you and I paid 15%, 7.5% by us and 7.5% by our employer. But don't be fooled by the employer part. Be assured, it's your money, and part of your overall compensation.

Had Congress lived up to its promise, our maximum Social Security tax this year would be $90 instead of over $6,000. Do you think the Social Security Act of 1935 would have ever been enacted had Americans back then known that we'd be subject to a $6,000 tax? Neither do I.

Here's another lie in the original Social Security pamphlet. "Beginning Nov. 24, 1936, the United States government will set up a Social Security account for you. ... The checks will come to you as a right." Americans were led to believe Social Security was like a retirement account and money placed in it was our property. In reality, we have no property right whatsoever to our Social Security "contributions." And there is no "trust fund".

Consider this:

In 1940, a total of 3% of a person's income was taxed for Social Security, AND there were 35 people contributing for every person receiving.

In 2000, a total of 15% of a person's income was taxed for Social Security, AND there were 3.5 (moved decimal point) people contributing for every person receiving.

In 2040, a total of 15% - OR MORE? - of a person's income will be taxed for Social Security, AND there will be 2 - or LESS? - (estimated) people contributing for every person receiving.

The system is simply not sustainable.

It shows the fallacy of income transfer programs.

Are they (income transfer programs) fair?????

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A couple of more things

by maxwell edison In reply to Off topic thread for Maxw ...

.
You are taxed (federal tax) on ALL of your income, unless you have a pre-tax 401(k) contribution. In that case, you are taxed (federal tax) on your total income minus any 401(k) contribution.

You are taxed (social security tax) on ALL your income - period.

Then, when people receive their social security payment, the money on which they paid a federal tax, they receive that payment MINUS a federal tax they are assessed. Double tax on the same dollar.

I'm 50, and I will probably get screwed by social security. (Well, I already am getting screwed - explained below)

You're in your 20s (I think), and you will definitely get screwed by the social security system.

How am I (and you and others) really getting screwed? Here's how.

If all the money that was paid, that's 15% of my income for the past 30 years, had been put into a mutual fund to grow, draw interest, or whatever, based on a very nominal rate of growth, my account would have over a MILLION dollars in it right now. Invested in a safe bond fund or money market fund, that MILLION dollars could have provided a retirement income for me of about $40,000 to $50,000 per year (or MORE if the accumulated total was more than a million), for the rest of my life, without any decrease in the original investment. Then, I could pass the original $$ (a million or more) on to my kids or to charity, or whatever I'd like when I die.

S-C-R-E-W-E-D ..... BIG TIME.

My advice to you, if you want it. Invest the MAXIMUM amount possible into your 401(k) account, and leave it alone. Contribute 15% of your income every year, every year, every year, starting yesterday.

Yes, you can afford it - because you can't afford NOT to do it.

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Pay as you go

by TheChas In reply to A couple of more things

One fallacy that is often promoted when people talk about Social Security is that there is an account under your SS number that will be used to pay you back when you retire.

The Social Security system is a "pay as you go" system.

The money you pay in today, mostly, goes to pay the benefits to everyone who is already retired.

Your SS benefit is based on your income the last few years before you retire.
If you are "downsized", and end up as a greeter at Walmart for 10 years before you retire, your SS benefit will be based on those wages, not your 30 years of active employment.

The "primary" problem with the SSI shell game, is that the US no longer has a work-force that is growing faster than the population of retirees.
You "need" to raise 4 to 6 children to have a work force large enough to fund your retirement via SSI.

Yes, there is presently a surplus in the SS fund. This is there to act as a buffer to help keep the system afloat when we "baby-boomers" start retiring.

The SS crisis that Alan Greenspan talks about is another issue. The big problem here is that Congress continues to bower money from the SSI account to fund the US Government.
Greenspan knows all to well that the tax increase and spending cuts that would be required to replace the borrowed funds will never get through Congress.

How did SS get in the shape it is in?
It is VERY easy for politicians to approve the spending of money that is already in accounts.

And, voting for increases in SS payouts is VERY popular with senior citizens.
Since seniors have a record on voting with more regularity than younger voters, it is in the politicians personal interest to keep the seniors happy.

Congress being Congress, they eventually increased benefits beyond the rate of money coming into the fund. This is why both the tax rate and earnings cap for SSI keep being raised.

I may be wrong on this point, but I thought that income tax on SSI benefits only starts if you have other income that is in excess of a threshold.

The biggest argument against eliminating the Social Security program is that the vast majority of Americans will NOT save for retirement unless forced to.

Yes, if you sit them down and talk to them, they understand the need and reason to save.
However, the "need" for consumer goods has far too many people in a credit crunch where they cannot afford to have even 5% go to their 401K account.

Then, there are the companies that have taken the 401K contributions and ran with the money.
This makes many people that I know afraid to join the 401K program where they work, as they know the owners of the companies they work for are crooks.

With the growing number of pension plans going broke, rising medical costs, and companies changing the rules after people have retired, how could we go about reforming the Social Security system?

Since the system is a pay as you go system, which current beneficiaries should have their SSI benefits reduced?

Which of our Aunts, Uncles, and Grandparents don't deserve their full SSI payments?

Are you willing to pay a doubled SSI tax for 10 to 15 years to change the system to individual accounts?

Chas

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TheChas, I Didn't Read Your Whole Post...

by SyscoKid In reply to Pay as you go

...but would like to respond to a couple of points.

"Your SS benefit is based on your income the last few years before you retire.
If you are "downsized", and end up as a greeter at Walmart for 10 years before you retire, your SS benefit will be based on those wages, not your 30 years of active employment."

Wrong. In general, it is based on an average of your 35 highest years of earnings from age 23 to age 62. Of course, 10 years in a lower-paying job than you had before will drive down your average

"The primary problem with the SSI shell game, is that the US no longer has a work-force that is growing faster than the population of retirees.
You need to raise 4 to 6 children to have a work force large enough to fund your retirement via SSI".

The problem I have with that is your reference to SSI. Many people do not understand that SSI is a whole different program than Social Security, though it is administered by the same agency. SSI is a welfare program, funded by general revenues, not the trust funds. A prior post mentioned immigrants getting SSI at age 65 even though they never paid into it. Well, there's nothing to pay into. If you're poor enough, you may qualify for SSI even if you never worked a day.

But you're absolutely right about it being a pay as you go system. It always has been.

Well, that's my two cents.

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PS

by SyscoKid In reply to TheChas, I Didn't Read Yo ...

The maximum SSI payment in 2004 is $564 (it could be higher if the state you live in chooses to provide what's called a supplement). This is reduced by any other income you have (with certain exclusions). That's not exactly livin' large.

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Must have missed a rule change

by TheChas In reply to TheChas, I Didn't Read Yo ...

Thanks for the update on SS benefits calculation.

I know that it used to be the last 5 or 10 years that counted the most toward determining a personal benefit.

I don't pay as much attention to Social Security rule changes as I should.

As I see it right now, I'll still be working when I'm 80 just to keep my head above water.

Chas

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If You're Interested

by SyscoKid In reply to Must have missed a rule c ...
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I'll take it!

by mrafrohead In reply to A couple of more things

I think that that sounds like good advice, and in honesty, I hear that more and more lately. I really need to get it going.

To everyone that responded, thank you, I appreciate your comments!!!

Mrafrohead

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