That's as good as definition as exists between mainstream Democrats and their breakaway faction, which AOC is angling to head. She doesn't appear to be doing it in 2020, but I wouldn't be surprised to see AOC form a new party for the 2022 election.
Why would it need to be privatized to invest into index funds? Why didnt and couldn't, that happen from to the start or begin now?
Right now there is no investment - the money goes out as soon as it comes in. And it's always been this way, since the first people to receive benefits obviously had not been making contributions over the years. I don't remember the details of the privatization plan, but if our taxes all went into our own private accounts, where would the money come from to pay those people receiving benefits now? IIRC, it was a big drop in the stock market that cooled down enthusiasm for the idea.
She's smart enough to realize that would make her irrelevant. Now, creating a very robust "Tea Party of the left," THAT could happen.
I dont know the details, but to me as an outsider, SS just seems to be equivalent to welfare payments for the old, but isnt any type of pension plan at all. I find that odd, especially for a country like America. I dont get why they dont try to transition it into an actual pension style plan. Long term, compounding returns is going to the only way to stabilize such a program.
The difference between what comes in and goes out (it was in surplus from most of the past history) is used by the government for other stuff, it is accounted for as a "loan" with interest payments, they are tied to Treasury bonds, but are a special category. I know there are pros and cons about just passing some law that would make the S.S. fund separate from the government fund and just issue them a bunch of treasury bills to say that is what the fund holds as an asset, it would be close to 3 Trillion dollars worth of Treasury bills. Then in theory, then the S.S. fund could sell/trade those T-bills (or a portion of it) in the stock market to get a better return.
If she did it would probably end the same as the SDP over here... NOT well. https://en.wikipedia.org/wiki/Social_Democratic_Party_(UK) But the point she made, as it's written there, is pretty nonsensical. People like Musk haven't got a billion dollars, They either start or invest in companies that develop products or services that other people think are going to be successful and so raised the share price to a level that made his shares worth a billion dollars. As a not insignificant amount of that money is borrowed it didn't actually belong to somebody else anyway so to say he 'took it' is incorrect.
In 2018, SS took in only $3 billion more than it paid out. Looks like we are at the tipping point where more money will be going out than coming in. https://www.fool.com/retirement/2019/04/24/social-security-ran-a-3-billion-surplus-in-2018-so.aspx
somebody else anyway so to say he 'took it' is incorrect.[/QUOTE] The right has overstated Social Security's funding since forever. I found a 1983 article about the system's "insolvency crisis." However, eventually the clock will strike midnight without major changes to the system -- and that "eventually" is beginning to appear on the horizon. However, it's hard to have their conversations politically because the right has acted in bad faith, and the left is locked into the untenable position of "it can't be touched."
Yes, there is 2.9 Trillion in the paper bank of IOU. https://www.cbpp.org/research/socia...understanding-the-social-security-trust-funds People that bitch about this being a drain in the General fund budget are bitching about an accounting issue, we could "easily" solve it by making the S.S. fund a totally independent fund from the General government fund. But I believe there has been resistance to this idea.
But GOP propaganda against the Dem candidate is a lot more effective if it's been proactively validated from the Left. Trump's base is solid, but he really can't add to it. The way to beat the Democratic advantage in numbers isn't to expand the current GOP coalition (because they really can't) but to demoralize/diminish the Democratic coalition. And that's a LOT easier to do if younger, more liberal voters have already been told by their own side that the Democratic candidate is a "corrupt Establishment centrist [etc.]".
People have been saying this for +30 and I've not heard than say how this would make things better than they are now.
Biden will have better "coattails" in moderate/swing/purple districts than Sanders. We need to hold the House and keep making gains in state governments (I'm trying not to get my hopes up about the Senate).
Yep. The political hope of the current version of the GOP, which skews old, white, and Christian and thus has limited reach, is that younger voter throw up their hands, say "they're all bad," and stay home.
The fact that AOC is arguing that the Democratic coalition is "too big" and that moderates shouldn't be tolerated even as she's supporting a campaign that welcomes right-wing white men into the fold gets right at why I think she represents a new divisiveness that's far beyond standard hard-nosed campaigning.
Visually, but not economically. Having the S.S. flow thru the general budget makes deficits look better, many administrations have used this to "game" spending ceilings, since the surplus makes the budget look better than if this was totally separated. Now that there will be yearly shortfalls, it will make the deficit look worse, so perhaps this would be the time to fix this accounting. For what I remember from my basic governmental accounting in college, States and municipalities do separate their retirement obligations from the general budget by law, this is how we see that many states and cities have underfunded obligations.
Also, young voters tend to forget--or not understand--the demographics of the Democratic coalition. The horrible moderates and "centrist" voters the angry young progressives despise so much are disproportionately older POC. The liberal/progressive wing of the party leans young and white. Purging the party of "moderates" will make it a whiter coalition, regardless of whether or not that's the intent.
It would make the "General Fund" look better while making retirement look worse. Frankly not that much of a reason to make the change.
Hipsterism is a white culture movement.* It's a more amiable version than white nationalism, but it's not much better at appreciating the viewpoints of people who come from a different generation and background. * Yeah I know that hipsters were a 2010 thing. I don't know what the 2020 equivalents are called, but they're the same people living in Logan Square, just in somewhat different clothes and one decade later.
It would not make it look worse IMO, it will make it look correct. Have the cash flow come into the S.S. fund and go out of the S.S. fund. I think one of the main arguments against it is that the "special" T-bills that are used as IOU for Social security are deemed to be default proof, meaning the Government can not default on them, compared to regular Treasury bills which in theory the government could default on.
BTW, something that I was wrong about this whole time. Under the Obama stimulus package the payroll tax was cut for a few years (one year?). I was under the impression that this shorted the Social security income for those years, but nope, the difference was made up from general fund contributions. This is perhaps easier to do when the system is pay as you go, vs having it independent from the general budget. https://www.govinfo.gov/content/pkg/BILLS-111hr4853enr/pdf/BILLS-111hr4853enr.pdf
That's kind of like saying that the PNL of subsidiaries should not be included in the PNL of their parent company. The information you are seeking can be found now anyway.
It is how it is done at state levels and local levels, but looking at how underfunded they are, and how politicians have gamed the system (by over-promising and under funding) their obligations, perhaps the way the Federal government does it is better. I guess if the S.S. fund was totally independent, it would make it easier for say Republicans cutting the Payroll tax to under fund the S.S. fund with out having to adjust the expenditures, so it would not hurt them in the short run, but would hurt the fund in the long run. It would also make it easier for democrats to pass larger benefits with out increasing payroll. So yeah, based on state level examples, independence of the fund may not be a great idea.