Oops...Perhaps We Got that One a Bit Mashed Up

It has been an ongoing issue that it has been suggested there is a point at which the system could BECOME insolvent. Unfortunately, not much has been done to fix the way we fund and administer the benefits, AND on top of that, we have expanded the definition of what a disability is, removing even more people effectively from the workforce, and taken them out of the contribution pool. So, you have a bit of a double whammy here. Personally, I don't think Social Security will ever simply go away. But we're definitely going to have to rely on a different way to fund it, and that may mean taxes will have to go up in order to do that unless we can find creative ways to redirect other funding since Social Security is not paid for through the general fund. What we have, basically, is a conundrum within a Ponzi scheme that has come to a head as all Ponzi schemes eventually do. And because we did not use our time (the politicians) effectively to truly engage in solving the problem, getting to where we need to be will come with more pain, and I think more concession, than we'd prefer to have to live with. The system may have to change future benefits such as what happened with military pensions. When my dad retired, he retired at 52%. If I'd have stayed in and retired, I'd have retired with 35%. On the disability side, I think we need to do the heaviest of reforms. We have many people classified as disabled who are not truly disabled and the criteria to determine disability needs to be more stringently scrutinized. I would even go as far as to suggest that perhaps disability needs to be separated from Social Security, taxed differently, and receive funding in other ways. But of course, that's for our elected people to figure out.

@porwest That's very sad. Daily wage labourers here earn very less and don't have to pay income tax. So at oldage they are in a very bad condition unless their children take care of them.

We pay taxes here too for Social Security, with an employer match paid in. The issue is not that a tax was collected or not. The issue is that the taxes collected from your paycheck today do not go to your benefits. They go to current recipients.

@aninditasen Old people who did not work and pay into the system here also do not receive benefits.

Many people do, which is why it is important to find solutions to help shore it up. But in order to do that, it helps to know what the problem is, and what the problem isn't.

@porwest Let’s hope they don’t.

There isn't one, really. Although, I think the government would have a much bigger problem on their hands if they took it away than just finding a better way of dealing with it.

@porwest Do they really want to?

@LindaOHio It's not a matter of whether they want to. They have to. If politicians break a very important promise to the American people, that will not end well for them and there would be considerable backlash.

I am actually glad that people are living longer. Granted, not everyone has the same quality of life in their later years, but I still think it is better. It does pose an issue when it comes to Social Security. But I think our politicians can find solutions if they really want to.

@porwest Wise words

Everything the government touches goes to hell. We're good at military things. But as soon as it comes to anything else? We're screwed and it all falls apart. When you look at even government pensions, one needs only look at Calpers. It's a mess of great proportion. Privatize the whole thing and I bet we get better results. But of course, we won't do that. So, because of the method of funding and the politicians who really don't understand the real world of money and finance... Whatever happens is anyone's guess, by MY guess is, it won't be as good as it can be. To the younger generation I say max out those 401ks and be REALLY involved in how it is administered. It's your best bet to save face IF and when it all goes to hell.

Thank you, ma'am. I always appreciate you checking in.