• Apparel
• Archives
• Contact
• Like gimme-five?

10 Responses to “2006 Personal Savings Was a 74-year Low”

1. Shaniqua Says:
   February 6th, 2007 at 11:02 pm

   …social security is on the verge of collapsing…

   Say What?

   First, and secondly…

2. George Says:
   February 6th, 2007 at 11:32 pm

   Shaniqua returns! (but the links don’t work… I think the domain prospect.org might be down…)

3. cranky old hack Says:
   February 9th, 2007 at 10:28 pm

   Shaniqua

   The government can print more money to solve the medicare and social security liability problems and we can use inflation to get out of the problem.

   Or the government can cut lots of services to pay for social security and medicare expenses each year.

   Or the government can raise taxes. This might slow the economy down some.

   We can continue to spend and spend and increase the debt each year and hope Asia will continue to buy our debt and keep interest rates down no matter how high the debt increases.

   Medicare is a major challenge. Bush’s prescription drug plan didn’t help it any.

   Which one do you propose we do?

4. Shaniqua Says:
   February 10th, 2007 at 10:20 pm

   I propose that George stop writing that SS is on the verge of collapse. That’s about it.

   I’m all right Jack. Keep your hands off of my stack.

   I suspect that George is parroting the WSJ and NYT in this SS is going to be insolvent in 40 or so years bullshittery that keeps blaring every few weeks from the dipshits at CATO.

   Start by doing something positive about Medicare. Hell, cut medicaid too. Who gives a flip if the poor get dumped. You know, …Share it fairly but don’t take a slice of my pie….

   But I also suspect that George has some nice indexed funds that are returning nice gains by skimming the old, the poor and the taxpayers in general.

5. George Says:
   February 11th, 2007 at 7:42 pm

   From the official SSA Website:

   Social Security is not sustainable over the long term at present benefit and tax rates without large infusions of additional revenue. There will be a massive and growing shortfall over the 75-year period.

   Social Security’s Chief Actuary projects that in present-value dollars the financial shortfall (or unfunded obligation) for the 75-year period is $4.6 trillion. This unfunded obligation indicates that if an additional $4.6 trillion had been added to the trust fund at the beginning of 2006, the program would have had adequate financing to meet the projected cost of benefits scheduled in current law over the next 75 years. See the 2006 Trustees Report. (Source: SSA)

   Perhaps “collapse” was much to strong a word. Yet social security has big problems, as the website acknowledges.

6. Shaniqua Says:
   February 11th, 2007 at 9:01 pm

   Social Security is not sustainable over the long term at present benefit and tax rates without large infusions of additional revenue. There will be a massive and growing shortfall over the 75-year period.

   The same administration that told us Iraq has weapons of mass destruction and that the war will pay for itself, now takes on the task of prognosticating what will occur at the conclusion of a 75 year period in the future. All things being known that is. The same administration that muzzled scientists would never, ever, ever, muzzle economists that didn’t agree with their view. No, it’s just insane to think that there may be political content on the government’s websites to correspond to their political views.

   Even if iven that they claim prognostication clarity, it’s like people from 1930 being able to prognosticate what the world of 2005 would be like. Enlightened people had no idea, and I certainly wouldn’t put either Bush or today’s capitalists into the enlightened groups since they are all about immediate gratification, self interest and accelerating the rapture so that it comes during their lifetimes.

   I suspect that Bush and Republicans are trying to kill off a large number of people through climate change thus doing their bit to extend SS solvency. The old and infirm can be first to be thrown onto that pyre.

   See, problem solved.

   I can identify a large source of the problem. Are you ready for this? People live longer, they want to live well, and they only want to pay SS taxes on a part of their income, no matter how much they make. The confluence of longevity, greed, ignorance and consumption has a price.

   I would agree that both the Democratic and Republican administrations have been willing to use the SS trust funds for political scaremongering.

   Social Security’s Chief Actuary projects that in present-value dollars the financial shortfall (or unfunded obligation) for the 75-year period is $4.6 trillion. This unfunded obligation indicates that if an additional $4.6 trillion had been added to the trust fund at the beginning of 2006, the program would have had adequate financing to meet the projected cost of benefits scheduled in current law over the next 75 years. See the 2006 Trustees Report.

   Just $4.6 Trillion short? David Leonhardt tells us where to find some of it. From an article last month:

   ECONOMIX; What $1.2 Trillion Can Buy

   The human mind isn’t very well equipped to make sense of a figure like $1.2 trillion. We don’t deal with a trillion of anything in our daily lives, and so when we come across such a big number, it is hard to distinguish it from any other big number. Millions, billions, a trillion — they all start to sound the same.

   The way to come to grips with $1.2 trillion is to forget about the number itself and think instead about what you could buy with the money. When you do that, a trillion stops sounding anything like millions or billions.

   For starters, $1.2 trillion would pay for an unprecedented public health campaign — a doubling of cancer research funding, treatment for every American whose diabetes or heart disease is now going unmanaged and a global immunization campaign to save millions of children’s lives.

   Combined, the cost of running those programs for a decade wouldn’t use up even half our money pot. So we could then turn to poverty and education, starting with universal preschool for every 3- and 4-year-old child across the country. The city of New Orleans could also receive a huge increase in reconstruction funds.

   The final big chunk of the money could go to national security. The recommendations of the 9/11 Commission that have not been put in place — better baggage and cargo screening, stronger measures against nuclear proliferation — could be enacted. Financing for the war in Afghanistan could be increased to beat back the Taliban’s recent gains, and a peacekeeping force could put a stop to the genocide in Darfur.

   All that would be one way to spend $1.2 trillion. Here would be another:

   The war in Iraq.

   In the days before the war almost five years ago, the Pentagon estimated that it would cost about $50 billion. Democratic staff members in Congress largely agreed. …

   That whole SS FAQ on the SS site looks like it was written by Grover Norquist’s 26 year old retarded kid. Assuming he had one that it. Infinite horizon? Hahahahaha…

   Q: I’m 26 years old. If nothing is done to change Social Security, what can I expect to receive in retirement benefits from the program?

   A: Unless changes are made, when you reach age 60 in 2040, benefits for all retirees could be cut by 26 percent and could continue to be reduced every year thereafter. If you lived to be 100 years old in 2080 (which will be more common by then), your scheduled benefits could be reduced by 30 percent from today’s scheduled levels.

   30% Shortfall? I thought you were talking catastrophe.

   Shit, the future baby geniuses of America ought to be able to make up that shortfall in one year. The boomers never had newfangled knowledge tools like wikipedia. Wikipedia alone is worth 30%. Probably.

   Sorry about the long post. Bored and wired on coffee.

7. Shaniqua Says:
   February 13th, 2007 at 8:57 pm

   Mark Thoma, Brad DeLong and Edward Lazear weigh in on the solutions to the (airquote) 75-year problem.

8. George Says:
   February 13th, 2007 at 9:39 pm

   Shaniqua, thanks for the posts. Sorry I haven’t gotten back quicker, but I always appreciate discussion on the site.

   Back to the topic. The reason I’m concerned about social security is basic. A soon-to-be-rapidly growing number of retirees coupled with a large and growing government debt and a stretched budget just don’t seem to paint a very good picture to me. Our economy may be due for a rough patch in the near future as well, especially if anything is to be done about CO2 emissions.

   I think this article has a few grains of truth in it, as well. (as well as some problems, but it’s worth reading)

9. Shaniqua Says:
   February 15th, 2007 at 5:23 pm

   Original here . Takes on both of your pet peeves — SS AND Global Warming.

   The reason we should try to fix Social Security now is that the cure can be painless now. The problem is that under conservative assumptions about productivity, promised future benefits exceed future revenues by an ever-growing amount. So cut promised future benefits, and then if productivity does well, you can restore benefits if you like. The point is, planning for the worst case scenario does not hurt anybody in the non-worst-case scenario.

   In the case of global warming, taking drastic steps now to prevent the worst-case scenario has real costs, against benefits that are potentially nil–in fact likely nil, for a variety of reasons. So, contra Jane and Mark, it is possible to be rationally precautionary about Social Security and not so much about global warming–or precautionary in a different way about global warming, as I’ve been suggesting.

   As an aside, I disagree with Mark’s assessment of the relative likelihood of a Social Security crisis and a global warming crisis. I think that we are as certain as anything to have a lower ratio of workers to dependents at the current retirement age later in this century. The productivity bailout is the best hope for Social Security, and I admit to being an optimist there.

   My personal opinion of climate models, on the other hand, is that they are of very little reliability. I think that the probability that they give estimates of the relationship between carbon dioxide emissions and future temperatures that is even in the ballpark of being correct is quite low.

   As I said in my essay, if I believed the climate models, I would not worry a bit about global warming, because their forecast for moderate, gradual warming is one I can live with. My uncertainty about the models actually raises my level of concern about catastrophic climate change.

   If I were to put numbers on it, my subjective probabilities would be that there is about a 5 percent chance of a significant shortfall in Social Security down the road, and less than a 1 percent chance of a climate catastrophe caused by carbon dioxide emissions. The climate catastrophe is potentially much, much worse, which makes it a legitimately larger worry. But the cost of acting now on Social Security is essentially zero, and the cost of acting now on carbon dioxide emissions is huge (at least for the reductions allegedly needed).

   Angrybear takes him on. Also some interesting comments at Angrybear.

10. George Says:
    February 15th, 2007 at 5:57 pm

    I read that post today as well.

    … if I believed the climate models, I would not worry a bit about global warming, because their forecast for moderate, gradual warming is one I can live with.

    Yet another person that doesn’t realize a moderate, gradual temperature rise is all it takes for catastrophe.

    SS & Global Warming sure seem to have their optimists and pessimists…

	Web www.gimme-five.com

gimme-five is proudly powered by WordPress
Entries (RSS) and Comments (RSS).