Thread

1. GenerWork · 1790821127 · focus · HN ↗

   The primary issue is Social Security. It’s the biggest driver of spending, and nobody wants to do anything to cap its costs such as means testing or straight up lowering the amount it can pay out.

   As for the people that will inevitably bleat about how this is just horrible and we need to lift the cap on taxable SS income, that wouldn’t solve the core problem either unless you pair it with spending caps or cuts.

   1. what · 1790821542 · focus · HN ↗

      > and nobody wants to do anything to cap its costs such as means testing or straight up lowering the amount it can pay out

      Yes because everyone paid into it and wants their money back with interest as promised? This isn’t weird.

      1. klodolph · 1790822604 · focus · HN ↗

         You aren’t promised your money back with interest; that’s what an IRA is. Social Security is a different system which works by different principles. In Social Security, the money you pay goes to the people who are retired, and your retirement is funded by people who work in the future.

         Your money --> older generation

         Younger generation ---> you

         The main thing that makes my description incorrect / incomplete is that baby boomers, such a large cohort, broke the system. This was predicted and so the baby boomers actually did get their money back: they were taxed to fund OASI, which then goes back to fund baby boomers’ retirements, until it runs out.

         Baby boomers (only, sort of) <---> massive cushion in the OASI fund

         1. Xymist · 1790845469 · focus · HN ↗

            SS (and the equivalent in other countries) was, in hindsight, an incredibly stupid system to set up that way - people should be exclusively contributing to cover _themselves_ so that it's a saving/investment scheme rather than a pyramid scheme. If you're in poverty in retirement that shouldn't be because the current generation of workers is shrinking. It should be because you failed (or were unable - doesn't matter which) to carry forward enough from your own career.

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