Kat Hak Sung
Social security fund (2/8)
Thu Feb 10, 2005 18:04
64.12.117.7
Social security fund (2/8)
Bush uses the same tactic to carry out his policy: intimidation. In his first term, to start a war, he scared Americans that the "WMD" in Iraq posed imminent threat to US. Now, he repeated that social security is headed toward bankruptcy. He proposed that young people to privatize one third of their s.s. fund (4% of income) into financial market.
Does he really care for the benefit of young generation? No. He hurt them. In his first term, he had a tax-cut plan which mainly benefit the rich people. At the same time, he created a historical deficit. In another word, he borrowed the money to pay tax-cut. That loan he borrowed, after all, must be paid back. The payer will be the young generation. Bush put a debt burden on them. That's not enough, he is seeking to steal their retirement fund.
Is social security fund in danger now? Not really. The Social Security Administration estimates the fund will last until 2042; many economists estimate the fund will last much longer. There are many other ways to balance the s.s. fund account then. Here is a chart compare the shortage of s.s. funds compare to tax-cut over 75 years.
......Shortfall or cost as a percent of ..In trillions of dollars
..... GDP over 75 years ....................over 75 year
Shortfall, Social Security ....0.4% ............ NA
Trust Fund (CBO est.)
Shortfall, Social Security ....0.7% .............$3.7 trillion
Trust Fund (Trustees estimate)
Cost of the 2001/2003 tax....2.0%.......... $11.6 trillion
cuts, if made permanent
Tax cuts for top 1 percent,... 0.6% ............$3.4 trillion
if made permanent
http://www.cbpp.org/1-4-05socsec.htm
There was lesson from privatization. 401(k) was allowed to enter financial market in 1994. When the dot.com bubble broke out in 2001, many people suffered great loss in their retirement pension account and have to delay their retirement plan. Some people lost most of their pension when Enron went bankruptcy.
In Bush's plan, first of all, the young generation will lost 2 trillion. The administration fee of privatization estimated at 15% to 20% of total investment amount. Financial group win the first round even without a battle. And then, in a pool where big fish fighting with small fish and shrimp, who will be winner?
Most people left casino with full pocket? or empty pocket? Judge with your common sense.
Bush uses the same tactic to carry out his policy: intimidation. In his first term, to start a war, he scared Americans that the "WMD" in Iraq posed imminent threat to US. Now, he repeated that social security is headed toward bankruptcy. He proposed that young people to privatize one third of their s.s. fund (4% of income) into financial market.
Does he really care for the benefit of young generation? No. He hurt them. In his first term, he had a tax-cut plan which mainly benefit the rich people. At the same time, he created a historical deficit. In another word, he borrowed the money to pay tax-cut. That loan he borrowed, after all, must be paid back. The payer will be the young generation. Bush put a debt burden on them. That's not enough, he is seeking to steal their retirement fund.
Is social security fund in danger now? Not really. The Social Security Administration estimates the fund will last until 2042; many economists estimate the fund will last much longer. There are many other ways to balance the s.s. fund account then. Here is a chart compare the shortage of s.s. funds compare to tax-cut over 75 years.
......Shortfall or cost as a percent of ..In trillions of dollars
..... GDP over 75 years ....................over 75 year
Shortfall, Social Security ....0.4% ............ NA
Trust Fund (CBO est.)
Shortfall, Social Security ....0.7% .............$3.7 trillion
Trust Fund (Trustees estimate)
Cost of the 2001/2003 tax....2.0%.......... $11.6 trillion
cuts, if made permanent
Tax cuts for top 1 percent,... 0.6% ............$3.4 trillion
if made permanent
http://www.cbpp.org/1-4-05socsec.htm
There was lesson from privatization. 401(k) was allowed to enter financial market in 1994. When the dot.com bubble broke out in 2001, many people suffered great loss in their retirement pension account and have to delay their retirement plan. Some people lost most of their pension when Enron went bankruptcy.
In Bush's plan, first of all, the young generation will lost 2 trillion. The administration fee of privatization estimated at 15% to 20% of total investment amount. Financial group win the first round even without a battle. And then, in a pool where big fish fighting with small fish and shrimp, who will be winner?
Most people left casino with full pocket? or empty pocket? Judge with your common sense.
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