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AARP is dropping its opposition to cutting Social Security benefits, a move that could rock...

AARP is dropping its opposition to cutting Social Security benefits, a move that could rock Washington's debate over how to revamp entitlement programs. AARP has always opposed previous reform efforts, but it now has concluded that change is inevitable and needs to be at the table to try to minimize the pain.
Comments (35)
  • reming
    , contributor
    Comments (5) | Send Message
     
    I trust that does not include those of us ready to retire now. If so, thanks AARP for pulling the rug out from under us.
    17 Jun 2011, 10:14 AM Reply Like
  • Hubert Biagi
    , contributor
    Comments (713) | Send Message
     
    Doesn't affect anyone over 55, I believe. This approach has been discussed nauseum, but your response shows just how effective the dis-information campaign has been. Fact is, the math no longer works for SS. Too many people drawing, too few people contributing.
    17 Jun 2011, 10:28 AM Reply Like
  • Gaping hole in the ocean
    , contributor
    Comments (207) | Send Message
     
    No of course they won't, they will spare you guys because you actually pay attention to current events and more importantly you vote.
    17 Jun 2011, 10:39 AM Reply Like
  • warrenrial
    , contributor
    Comments (562) | Send Message
     
    I never trusted AARP and have always been suspicious of their operation.
    17 Jun 2011, 10:20 AM Reply Like
  • Terry330
    , contributor
    Comments (870) | Send Message
     
    AARP is just a insurance company.
    17 Jun 2011, 10:24 AM Reply Like
  • wyostocks
    , contributor
    Comments (9105) | Send Message
     
    This is the first intelligent comment I've read from you. But, they really are insurance brokers.
    See, you can do it. Stay off the Kool Aid.
    17 Jun 2011, 11:02 AM Reply Like
  • a fat panda
    , contributor
    Comments (806) | Send Message
     
    "Just an insurance comany"

     

    It is just a union posing as an insurance company.
    18 Jun 2011, 08:52 PM Reply Like
  • eggfaced
    , contributor
    Comments (293) | Send Message
     
    AARP is maybe the most powerful lobby in DC.
    17 Jun 2011, 10:25 AM Reply Like
  • wyostocks
    , contributor
    Comments (9105) | Send Message
     
    AARP cares about one thing and one thing only, making money for themselves. They are complete phonies.
    17 Jun 2011, 10:25 AM Reply Like
  • Sean07
    , contributor
    Comments (5) | Send Message
     
    I quit AARP years ago (am I still young?). They are as reliable as Obama in supporting the diminshing middle class. A better organization is the Alliance for Retired Americans. They're active.
    17 Jun 2011, 10:25 AM Reply Like
  • Scoe
    , contributor
    Comments (219) | Send Message
     
    Someday, we will come to terms that SS is a Ponzi. Only then will this get fixed. You can tweak a Ponzi all you want but it's still a Ponzi.
    17 Jun 2011, 10:26 AM Reply Like
  • linenoise
    , contributor
    Comments (216) | Send Message
     
    How is it a ponzi? It took in more than it paid out until the 80's when it was restructured. The only reason it is 'going broke' is because it was used as a lender instead of borrowing from other countries, and given treasury bonds as iou's. All we have to do to restore SS is undo the 80's restructuring or perhaps raise the taxable income ceiling from 108 to 250k, which when adjusted for inflation is less than where it should be.
    17 Jun 2011, 10:38 AM Reply Like
  • Hubert Biagi
    , contributor
    Comments (713) | Send Message
     
    While I agree with most of your statement (remember the "lock-box"), I disagree with raising the income level for contributions. Then SS would truly become just another tax and another massive welfare program. Any semblance to a retirement savings program would be completely lost. If you think Congress has already raided SS, imagine what would happen once contribution/benefit correlation is completely broken. Just like gas tax which was originally just supposed to go for highway improvements, or the state lotteries, just for education funding. Once you turn SS into just another tax, it will be completely doomed.
    17 Jun 2011, 10:46 AM Reply Like
  • Scoe
    , contributor
    Comments (219) | Send Message
     
    It is a Ponzi because you pay in on one end and different people take out on the other side. The money you contribute is gone...simply used to pay off somebody else. Your money is not saved and put to work creating wealth like a legitimate retirement plan. It is simply passed on to somebody else. Not at all different from Bernie Madoff except that Bernie got your money voluntarily but social security takes your money by force of law.

     

    Until the money is in your name and actually in an account earning for your retirement while you are still working, then it's a Ponzi. There is no wealthy creation, simply a payment transfer minus transaction costs. Soon it will be payment transfer minus transaction cost minus borrowing costs minus currency devaluation.

     

    The whole thing would be blatantly illegal in the private sector.
    18 Jun 2011, 09:19 AM Reply Like
  • mowjo
    , contributor
    Comments (96) | Send Message
     
    I don't understand why the max taxed is so low. Those making to 108,00 pay the full 6+% those making 216,000 pay only half that, etc, etc..
    17 Jun 2011, 10:26 AM Reply Like
  • Hubert Biagi
    , contributor
    Comments (713) | Send Message
     
    I believe it's capped otherwise those higher brackets would never come close to getting back their contributions. The amount that one pays in payroll taxes throughout one's working career is indirectly tied to the social security benefits annuity that one receives as a retiree. Otherwise, SS would just become another massive welfare program.
    17 Jun 2011, 10:38 AM Reply Like
  • Scoe
    , contributor
    Comments (219) | Send Message
     
    Capping the contribution is an attempt to make it a retirement plan, not a confiscation tax.

     

    It would be asking a lot of people to put in five or ten times as much money as someone else and then the same amount out.
    18 Jun 2011, 09:23 AM Reply Like
  • Scoe
    , contributor
    Comments (219) | Send Message
     
    Is AARP a non-profit?
    17 Jun 2011, 10:26 AM Reply Like
  • Scoe
    , contributor
    Comments (219) | Send Message
     
    Answering my own question..."yes"
    18 Jun 2011, 09:23 AM Reply Like
  • wyostocks
    , contributor
    Comments (9105) | Send Message
     
    AARP is a non profit only in the eyes of the IRS. They rake in millions in fees and rebates from the insurance policies that they lend their name to.
    18 Jun 2011, 09:48 AM Reply Like
  • Lakeaffect
    , contributor
    Comments (1201) | Send Message
     
    Social Security (and Medicare) have been on the ropes for years. In the mid 1970's there were plenty of stories about SS running out of money just as the Boomers were nearing retirement age. They surfaced again in the 1990's. The warnings were completely ignored by most. Apparently they decided that they could trust their politicians to take care of the problem for them. Hah!
    17 Jun 2011, 10:32 AM Reply Like
  • Gaping hole in the ocean
    , contributor
    Comments (207) | Send Message
     
    Let us think back to ohh maybe a little more than ten years ago when all of SS liabilities were fully funded. Now we have "no choice" but to reduce benefits in the program. If the program was used they way it was intended (i.e. - to give retirees who paid in during their working lives an income in retirement) and not abused as a wellfare program there would be no problem. The working class should not have to suffer because of the political aspirations of certain politicans.

     

    And it is painfully obvious AARP is the problem, not the solution.
    17 Jun 2011, 10:34 AM Reply Like
  • CharlieM
    , contributor
    Comments (150) | Send Message
     
    Gaping hole in the ocean,
    I agree whole heartedly with you on this. As Social Security had originally been setup we would have a HUGE windfall in it by now had it not been for the theft from it by LBJ and his liberal welfare programs. I had a professor use Social Security as an example to illustrate the difference between a Ponzi scheme and a benefit plan. The point of departure from a benefit plan and a lapse into a ponzi scheme came when social programs were loaded on the social security system.

     

    What can be done? Some interesting postulations came out in that class. Things like increasing the contribution amount and removing social welfare from it. WHY should those that contribute nothing to social security be allowed to take from it. You don't want to work with the skills or lack of skills you have chosen to work for then don't eat and live on charity.

     

    But DON'T force those that have paid into it all of their lives to take the haircut as AARP is agreeing to. What a sham and shame on AARP for agreeing to this when they represent so many that rely on these for their very lives.
    17 Jun 2011, 10:46 AM Reply Like
  • Hubert Biagi
    , contributor
    Comments (713) | Send Message
     
    Exactly, SS is supposed to be a benefit program not another welfare program. But like everything else Congress gets their hands on, the money has disappeared into more and more entitlement based spending. If they raise the income cap for contributions, I seriously doubt that money will ever find it's way back to this benefit program. Just like proposals to increase the cigarette tax to fund healthcare, this will never work, except to encourage more reckless spending.
    17 Jun 2011, 11:13 AM Reply Like
  • Mad_Max_A_Million
    , contributor
    Comments (1175) | Send Message
     
    Gaping Hole / Charlie M

     

    Excellent analysis! I still think that the large number of Boomers will work in their favor. I do not believe that the boomers will stand for the theft of trillions from their SS lock box, followed by a sympathy card from congress.

     

    The heat on congress to cough it up will be intense. They don't mind losing a chunk of their 401K due to their own negligence, but to be played for a sucker by their own government will not fly.
    17 Jun 2011, 11:12 AM Reply Like
  • Duude
    , contributor
    Comments (3398) | Send Message
     
    Reforming Social Security is a cake-walk next to medicare reform.
    17 Jun 2011, 11:33 AM Reply Like
  • CharlieM
    , contributor
    Comments (150) | Send Message
     
    Duude,
    I agree with you on this point too.

     

    Trying to envision solutions has driven me to near obsession for possible solutions. I have researched what other countries have done and not done and have found one VERY common thread in all of them.

     

    If government is involved it suffers in care for the dollars spent. A socialized medicine system (Canada and England for example) have an overwhelmed system.
    Systems that rely on individual's ability to pay with either insurance or personal assets leave a lot without health care. What I did find is that systems that rely on non-government interventions do have a lower cost for health care.

     

    What is right, what is fair and what is best for all? I am willing to bet that if SA were to post an evening survey for something like this it would get some wild and maybe helpful insights and responses.
    17 Jun 2011, 11:54 AM Reply Like
  • wyostocks
    , contributor
    Comments (9105) | Send Message
     
    How about we "fix" the mess with congressional pensions first.
    Think the crooks posing as congressmen and senators will deal with that?
    17 Jun 2011, 11:36 AM Reply Like
  • joe kelly
    , contributor
    Comments (1804) | Send Message
     
    AARP, organized labor, chamber of commerce; all used to further an agenda for whomever has control of them. Beware of who's in control.
    17 Jun 2011, 11:39 AM Reply Like
  • fast track
    , contributor
    Comments (9) | Send Message
     
    Social Security should not have been borrowed from by the government. It should have been invested by each person as they saw fit.
    17 Jun 2011, 11:43 AM Reply Like
  • CharlieM
    , contributor
    Comments (150) | Send Message
     
    Fast track,
    I would say I have been doing just that for the past 20 years. I have been a faithful contributor to my 401k or IRA for the entire time. In doing so I have contributed 10% of my income and continued to do so even when my employers did not add a matching balance.

     

    I would agree to cessation of Social Security contributions for my age group but would not support stopping contributions for those that could not prepare for it. Those that are already retired, are retiring in the next 10yrs should be continued but ONLY those that are going to be drawing for retirement and not welfare.

     

    I have not expected to draw social security in my lifetime. I see it as just another tax my employer and I have been suckered into paying. I would like to see a mandatory requirement for matching contribution for 401k in the future but, I don't expect it. Then again, if the fed thinks their freeloading funding of social vote purchases might come to an end, I would not be surprised in the least, to see the government step in seize 401k programs for their own selfish use.
    17 Jun 2011, 12:23 PM Reply Like
  • Lakeaffect
    , contributor
    Comments (1201) | Send Message
     
    Charlie M; I agree with you 100%. Your comment about SS just being another tax we have been suckered into is spot on.

     

    Back in the 1970's, when I was just starting a career, it became clear to me that SS funds would not be around when I was old enough to collect it. As you stated, my preference would have been for the Gov. to come clean about it, and after funding the then retired and nearly retired, phase out the tax altogether.

     

    A mandatory system where one generation is forced to fund the retirement payouts to the preceeding generation doesn't work when the population is shrinking/ ageing and life expectancy is increasing. It not only is subject to manipulation and theft by the politicians, but it discourages folks from saving because they think the Government will take care of them in their old age.

     

    The current social security delimma exposes a serious defect in our present political system. Politicians for years have known about this problem, but they ignored it, because they knew they would be comfortably retired when the system became unglued. Let someone else deal with it, was the attitude. Politicians that have to worry about getting re-elected as soon as they get into office are the problem. Term limits are the solution.

     

    Obamacare will have a similar outcome, if left in place as currently written.
    17 Jun 2011, 01:31 PM Reply Like
  • CharlieM
    , contributor
    Comments (150) | Send Message
     
    Lakeaffect,
    I agree with you on the term limits. I have often wondered what the effect would have been had the 22nd Amendment included term limits for House and Senate terms. If there ever was a prime example of hypocrisy from our elected this has to be it.

     

    If anything, we should now be looking at lobbyists being outlawed to keep them from overshadowing the voice of the people. I find it amazing that we have and will have elected officials who have never worked outside a political office. HOW do they even begin to understand the voice of the people?
    17 Jun 2011, 01:43 PM Reply Like
  • Scoe
    , contributor
    Comments (219) | Send Message
     
    Lobbyists ARE the voice of the people and they have first amendment rights, too. Term limits would greatly reduce their effectiveness because they would be pleading to statesmen, not politicians.
    18 Jun 2011, 09:29 AM Reply Like
  • Marlin Keith DeBramaletta
    , contributor
    Comments (262) | Send Message
     
    401(k) and other investment alternatives have long replaced Social Security. Social Security is just a payroll tax as of now. Realistically if social security is eliminated, more institutional funds, investment funds, financial advisors, banks, brokers, and capital markets will gain. More customers will focus on retirement income and savings via investment measures, as opposed to the unreliability in this day and age of social security. The majority of employers will be forced to turn to the above mentioned investment alternative in order for employees to have a retirement plan. In addition prior to the 50's-90's, their is not a lot in the current employment market that has the customary working 20 years and retiring.
    17 Jun 2011, 10:37 PM Reply Like
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