Tag: Social Security

A tax plan that would promote economic growth

A tax plan that would promote economic growth

Both halves of Congress are trying to create a more fair tax plan that will promote growth and simplify the code. I am skeptical that anything will get done though as it appears that this Congress is incapable of doing anything significant.

Since Congress will almost certainly fail, I thought I would put my suggestion on the table. As I analyze it, it is probably the most likely plan that I have ever seen to encourage employment growth.

The first step is to not change anything for individuals except to increase the amount of money saved in long-term savings without tax penalty. This should be doubled from its present rate. The government is in the retirement business, and it isn’t doing a sufficient job of managing it. The government needs to get out of the retirement business because the government can rarely do something well. Social Security is a broken plan, and we all know it – we just need to transition out of the retirement business slowly so that we do not screw up the American workers that depend on Social Security.

Currently, the government taxes employees directly via the FICA tax on each dollar earned. The government increases this tax by assessing the employer an equal amount. This direct tax exceeds 15% and is used to fund Social Security. While it is essential to finance Social Security for today’s seniors, we need to get away from this transfer of cash from working Americans to retired Americans. We need to make it financially affordable for working Americans to save for retirement so that they can live off of their own money and not their children’s and grandchildren’s money. The fact that Social Security will be insolvent between 2025 and 2034 (depending on analyst assumptions) points to the fact that the system is systematically flawed. I have ranted on this in the past.

The biggest change in the tax plan is to change the way we tax our employers. Not just big companies but every employer – be they big or small. We need to reward companies for investing in their business and investing in their employees.

Currently, the corporate tax rate is around 35%. This tax burden is massive. Unfortunately, it is unevenly allocated and most directly hurts companies based in the US, primarily employs US workers, and principally sells to US customers. This is preposterous! Why is the federal government trying to hurt the best companies, but reward those companies that have substantial foreign investments?

My suggestion is to eliminate all tax loopholes in the corporate plan except for the ones that I itemize here. Yes, that means that Congress will never go along with me since every special interest lobbyist will argue and bribe vehemently to fight my simple and easy ideas. Here are the highlights of the plan:

  • Corporate income tax is 35% for all income.
  • Income taxed in a foreign country returned to the US corporate parent is the difference between the original tax paid and 35%. This balance of tax is still available for the following discounts (as well as all US based income).
  • For every dollar that is paid to train employees plus one additional dollar, there is no US corporate tax. Corporations should be encouraged to train their employees so that money shouldn’t be taxed and additionally they should be rewarded by claiming 200% of that investment up to 35% of corporate income. This reduction in taxes is good for the company, great for the employees, and magnificent for the US economy. In the 21st century, only smart workers are valuable, and we need to increase that pool of people.
  • Today, wages and benefits to employees are already written off and not counted toward income. This expense will remain the same (as with all business expenses) however if the employer hires more workers in the US and its territories from the previous year then the company should be rewarded. The company will be able to write off that new employee’s wages plus an additional 300% up to 35% of corporate income. Please note that this is ONLY for the growth of full-time employees from the previous year to the current year. The employer doesn’t get to deduct this cost for perpetuity but only for the first year. Also, note that this doesn’t allow the employer to increase foreign-based workers, the workers have to be reporting to work in the US and its territories.
  • Any improvements in facilities are already written off, and that will continue. However, this will be accelerated in my plan as the company can write off 200% of all INCREASES in facilities, marketing costs, sales costs, etc. as long as they are spent in the US and up to the 35% cap that already exists. They will be able to write this off in the year that the expense occurs. Note that this is only for increases in those costs over the previous year. If the company doesn’t grow those costs, then it is simply held at the standard 35% deduction, but if the company increases those investments in US-based assets, then the company can accelerate those year-over-year savings.

So how is this good for the US economy and the US worker? Simple, it is all about the economic growth, the growth of employment, and improving the lives of US workers. Companies that are unable to grow their business will not get this benefit, but companies that can employ more US-based people, create more US assets, and improve their ability to market to US-based customers will thrive. It puts America first in our corporate tax policy. It rewards companies that invest in America and it doesn’t help any company that chooses to invest internationally at the expense of America.

This plan will accelerate the return of money from foreign lands back to the US. This plan will encourage companies to hire more US-based workers and will significantly increase the quality of life of Americans.

This isn’t a giveaway to the corporations or a supply-side “hope for the trickle-down plan.” It only rewards companies that truly make the trickle-down (in the form of a gusher rather than a trickle) happen. No company will be able to take advantage of this plan unless they truly change that “trickle” to a firehose of economic prosperity.

This plan will never pass. Too many lobbyists will be hurt. Too many special interest groups will not have their interest served. However, this is one plan that would almost guarantee massive prosperity for the American middle class and therefore massively increased tax revenue for the Federal government.

It just makes sense which is why it will never be adopted by Congress. Simple things that make sense never seem to get done by Washington DC.

Photo by 401(K) 2013

Capital gains should be counted as wages–to a point

Capital gains should be counted as wages–to a point

warren.buffet.secretary.caption_picIf you pay attention to the news, you have heard Warren Buffet claim that he pays a lower tax rate than his secretary. This pronouncement has prompted President Barack Hussein Obama to propose new taxes, affectionately nicknamed “Buffet taxes” or the “Buffet Rule.”

The “Buffet Rule” is going to get a lot of press attention in the coming weeks and it will get more attention if Mitt Romney successfully wins the nomination of the Republican Party.

MittRomneyProfilePicAt this writing, Mitt Romney is running for the Republican nomination and at some time he is probably going to have to divulge his finances more fully than he has already. Mr. Romney doesn’t appear to have a wage-earning job, therefore, his daily spending on clothes, food, mortgage, and hair-styling products comes from interest, capital gains, or dividend income from his earned fortune. It appears that Mr. Romney paid less than 15% on his income where a wage earner would pay a much higher rate.

A lot of people say that the tax code is broken and I agree. Some propose a flat tax rate for all income, but that is probably a political hot potato. A flat-tax is also a little repressive as low wage earners probably shouldn’t have the same tax rate as the more affluent.

In America, everyone can have an opinion. So here is my suggestion:

  • All Americans should pay a minimum of 1% of their income in Federal taxes.  The approximately 46% of Americans who pay no taxes needs to stop. If everyone pays at least a little bit, then they all are part of the general sharing of the load. Everyone will be a bit more invested in making sure that the spending is appropriate.
  • All income, regardless of source, needs to be considered wage income for the first $500,000. The top line of your income for federal taxes needs to include all wages that come from your W2 or 1099. If that number is less than $500K, then include dividend and capital gains income up to $500K.  Why did I choose $500K? It seems like a fair number. I could make an argument that it should be up to $1M, but I cannot make a logical argument that it is less than $300K. Here is my logic:
    • Everyone has daily expenses that need to be paid. For most Americans, these expenses are covered with our income from our job. The expenses are things such as food, clothes, house and car payments, cable TV, the occasional movie and dinner out, and (since Mitt’s expenses in this area are likely quite high) hair care products.
    • Money that covers these regular expenses comes from wages for all but the most affluent Americans.
    • It is not appropriate that those that are very wealthy and do not make a wage should have the source of funds for expenses categorized as anything but wages. Even if they don’t make a wage and received the money from dividends or interest, a portion of that income is used for exactly the same thing as the minimum wage earner. Therefore, we need to classify it as a wage since that is what it is replacing.
  • FICA is currently capped at first $110,100 of income. This needs to change.  The upper cap needs to be on all wages as I have described in the previous bullet. This is fair, as well. All wages should be subjected to FICA tax. This would likely fix the problem of Social Security being underfunded for quite some time. Yes, I think that Social Security should be eliminated, but that isn’t going to happen either.

The great thing about a blog is that I can rant. There is little chance that any of the above will ever be enacted. It was fun to argue the point though and I hope that it was fun for you to read.

The images in this post are assumed to be in the public domain. I have linked to the sites where I found them. I do not own the copyright for these images.

Companies say health care costs hard to swallow

Companies say health care costs hard to swallow

I really love this line:

Consumers Energy, a Michigan gas and electric company with 2.9 million customers, said it will not take a big first-quarter charge because, like most utility companies, it can try to recover the added costs from its customers through rate hikes.

I am sure the state with the highest unemployment in the country will LOVE having their energy rates increased to pay for medical costs!

I get it, health costs will go down because it will get subsidized by the taxes on energy! We can just rob Peter to pay Paul because Peter is too stupid to realize he got robbed.

The really good news in all that is we may get some more new jobs – the bill gives the IRS $1B a year to hire new employees to collect all of these new taxes – that is about 12,000 new jobs for the IRS! Obama has finally come up with a solution to unemployment – hire the entire US population so that no one is unemployed!

Wall Street Journal has an opinion on all of these charges. They quote:

Towers Watson estimates that the total hit this year will reach nearly $14 billion

This is after AT&T, Deere, Caterpillar, AK Steel, 3M, and Valero announced a total of about 1.4B in combined charges. Verizon has already said they will need to announce charges just not sure how much.

That is okay though – I am sure that these companies are really rich and they will just absorb the charges and they won’t pass them on to the consumers. In fact, I am sure that these companies will now accelerate their plans to hire more people.

Obviously, a lot of what I said above is sarcasm. Here is what really going to happen. The door is open by a bad bill. Now there will be a lot of little fix bills to cover these problems. These little bills won’t get a lot of media attention in fact many will just be amendments on other bills. It won’t matter who controls the legislative or executive branch, the amendments will happen. These and other taxes are going to get taken out because they are stupid and punitive but the promise of free health care will continue (and probably expand) until 20 years from now it is as bad of a monstrosity as Social Security – under-funded and over-extended.

Speaking of Social Security, did you see that Social Security is now paying out more than it brings in as of this year (NY Times – the bastion of socialistic thoughts). Of course this is 6 years earlier than CBO said it would happen. CBO must have made a mistake. Isn’t that the same CBO that said ObamaCare will slightly help the federal deficit? I sure hope that it wasn’t the same group of counters that analyzed both programs since the Social Security analysis sure wasn’t on target!

There is very little that a government can do better than private enterprise. Now we have just placed 1/8 or more of our economy into the hands of the incompetents that can’t get a job in private companies so they run for political jobs.

What in the world are we doing? Will our children curse this day 40 years from now?

Companies say health care costs hard to swallow
By JOSH FUNK
AP Business Writer

The health care overhaul will cost U.S. companies billions and make them more likely to drop prescription drug coverage for retirees because of a change in how the government subsidizes those benefits.

In the first two days after the law was signed, three major companies — Deere & Co., Caterpillar Inc. and Valero Energy — said they expect to take a total hit of $265 million to account for smaller tax deductions in the future.

With more than 3,500 companies now getting the tax break as an incentive to keep providing coverage, others are almost certain to announce similar cost increases in the weeks ahead as they sort out the impact of the change.

Figuring out what it will mean for retirees will take longer, but analysts said as many as 2 million could lose the prescription drug coverage provided by their former employers, leaving them to enroll in Medicare’s program.

White House spokesman Robert Gibbs defended the tax law change Thursday, saying the original provision allowing companies to deduct the federal subsidies from their taxable income was a “loophole” that will be closed by the health care overhaul.

For the government, the tax changes are expected to raise roughly $4.5 billion over the next decade to help pay for the health overhaul. Some of the savings would be negated by retirees enrolling in the Medicare plans.

“You’re increasing the incentive for companies to say ‘We don’t want to be in the health care business any more,'” said James Gelfand, senior manager of health policy for the U.S. Chamber of Commerce, which fought the overhaul.

American industrial companies that are struggling to compete globally against companies with much lower labor costs are particularly likely to eventually drop retiree coverage, said Gene Imhoff, an accounting professor at the University of Michigan.

“Anything that they can use to justify pushing something away from the employees, pushing it back on the employees or the government, they’re going to do it,” Imhoff said. “I’m not sure you can really blame them for trying to do this.”

Caterpillar spokesman Jim Dugan said the company is still studying the health care law and doesn’t yet know what the full impact will be. But he acknowledged that benefit changes are possible.

“Obviously, there’s greater cost pressures on us that could drive changes to plans, but we haven’t made any decisions on that,” Dugan said.

Spokesmen for Deere and Valero said it was to soon to say how the change would affect the benefits they offer retirees.

When Congress approved the Medicare prescription drug program in 2003, it included government incentives for employers to provide drug benefits to retirees so the public system wouldn’t be overwhelmed. Employers that provide prescription drug benefits for retirees can receive subsidies covering 28 percent of eligible costs; those subsidies totaled $3.7 billion in 2008.

Under the 2003 law, companies could deduct the entire amount they spent on the drug benefits from their taxable income — including the government subsidy, an average of $665 per retiree.

The health care law signed by President Barack Obama on Tuesday prohibits companies from writing off the subsidies starting in 2011, meaning they will no longer be able to deduct them from their taxable income.

For example, if a company spent $100 on benefits, including a $28 government subsidy, it could write off the full $100 on its taxes under the old rules. The new rules would allow the same company to write off only $72.

The follow-up health care bill to reshape parts of the overhaul would delay the changes until 2013.

As many as 1.5 million to 2 million retirees could lose the drug benefits provided by their former employer because of the tax changes, according to a study by the Moran Company, a health care consulting firm.

James Klein, president of the American Benefits Council, said between 6 million and 7 million retirees currently get the benefits. But the number of companies offering them has been dwindling for years.

Generally, retirees would prefer to stay with prescription drug coverage provided by their companies as opposed to enrolling in a Medicare Part D plan, said Marilyn Moon, a health care economist with the nonpartisan American Institutes for Research.

She said most of the company-sponsored plans are more generous and almost none have the coverage gap that comes with Part D plans.

“That’s particularly painful and problematic for people who have substantial expenses at any one point in time,” she said.

Industry groups say they lobbied hard against the change in the tax rules before it was added to the health care law over the winter.

“It was in all of our letters and communications that went up to the Hill, and the companies were heavily involved in that,” said Dena Battle, a tax specialist with the National Association of Manufacturers.

Nationwide, companies would take a $14 billion hit on their financial statements if all of the roughly 3,500 companies receiving the subsidies continued to do so, according to a study by Towers Watson, a human resources consulting firm.

That financial hit will be a one-time cost as companies report a new cost estimate for the benefits over the life spans of all retirees.

Deere and Caterpillar were among a group of 10 companies that sent a letter to congressional leaders in December warning of the cost increases. The others were Boeing Co., Con-Way Inc., Exelon Corp., Navistar Inc., Verizon, Xerox Corp., Public Service Enterprise Group Inc. and MetLife Inc.

Most of the other companies that signed the letter said Thursday that it was too soon to estimate their costs. A number of other major U.S. companies also said they did not know how much the tax change would cost them. Some companies might wait until they release their earnings reports next quarter to address the costs so they have time to review the entire law.

The companies that signed the December letter warned that changing the way retiree drug benefits are subsidized would have a broad impact on the economy, and there are already indications that the effects will trickle down to individuals.

Consumers Energy, a Michigan gas and electric company with 2.9 million customers, said it will not take a big first-quarter charge because, like most utility companies, it can try to recover the added costs from its customers through rate hikes.

Healthcare for illegals

Healthcare for illegals

First, let me be clear, I think that Rep. Wilson of South Carolina should be censured for his outburst while President Barack Hussein Obama was speaking in a joint session of Congress. He reminds of irresponsible brats such as Kanye West. Public outbursts while the President is speaking are simply unacceptable in any format and definitely not allowed in a joint session of Congress.

I do think that it is interesting that the rude outburst occurred due to a statement from BHO regarding healthcare for illegal aliens. There is a reasonable argument that BHO, while perhaps not lying, was not telling the complete truth. Check out this interesting video below and then read the rest of my comments.

 

Now I see that the Democrats in the Senate would like to toughen up the loopholes to prevent illegal aliens from getting taxpayer supplied insurance. I don’t get it, BHO says that this can’t happen but now a few days later there is an amendment that prevents this thing that can’t happen.  Makes me think that BHO was bending the truth a bit and probably knew it.

Of course the solution that the Senate is currently thinking about is to use Social Security numbers.  Seems reasonable.  SS numbers have become the defacto national identity card that we need. I have ranted on this before, if we would just have national identity cards then we would control much of the illegal problem that we have.

Below are a few clips from a recent article in the Wall Street Journal:

A key Democratic senator said Friday that lawmakers planned to toughen provisions in a health bill to prevent illegal immigrants from enjoying benefits, in a Democratic response to concerns by some Republicans.

Members of the Senate Finance Committee met Friday, and Sen. Kent Conrad (D., N.D.) said they wanted to use Social Security numbers to ensure that illegal immigrants weren’t eligible for subsidies envisioned as part of a plan to expand health coverage.

President Obama’s health-reform proposal has sparked heated debate over whether the plan benefits illegal immigrants, as demonstrated by Rep. Joe Wilson’s “You lie” outburst. WSJ’s Elizabeth Williamson breaks down the details of the proposed new government-run insurance plan.

Still up in the air is whether illegal immigrants would be banned from participating in federally regulated insurance “exchanges” under Democrats’ health bills, even if the immigrants were willing to use their own money to buy policies. On Friday, a coalition of three dozen faith-based groups wrote to Congress to express anger at the proposed ban.

The 100 accomplishments of the George W. Bush administration

The 100 accomplishments of the George W. Bush administration

As I write this, George W. Bush is only a few days away from the end of his 8 year Presidency.  Earlier, I had graded Mr. Bush on a variety of major factors but I felt that I left off a huge number of things that he and his administration did or did not do.  This list is the result of trying to be more inclusive.  Many items on this list are actions by the Mr. Bush and his administration and some of them are inactions.


Economy
1 Increased defense R&D spending
2 Accelerated the cleanup of brownfields
3 Prescription drug benefits in Medicare
4 Ordered renovation of military housing
5 Signed Medicare Reform
6 Allowed disabled people to use up to a year’s worth of vouchers to finance down payments on homes
7 9.7% increase in government-wide homeland security funding
8 Increased budget deficit to Eisenhower levels (% of GDP)
9 New Health Savings Accounts
10 Increased the limit of Education IRA from $500 to $2,000
11 Didn’t fix economy hurt by housing crisis
12 Allowed mortgage crisis
13 Initiated 3 separate raises for US military personnel
14 Increased the Defense Department’s base budget more than 70 percent since 2001
15 Pushed through 2 separate income tax custs
16 Reduced the number of homeless veterans by 40%
17 Fixed economy inherited in 2000 and hurt in 2001 attacks

International

18 Killed the old US/USSR ABM Treaty
19 Paid off US debt to UN
20 Signed the largest nuclear arms reduction treaty with Russia
21 10 ABM silos in Alaska
22 Prematurely declares “Mission Accomplished” regarding Iraq
23 Doubled foreign assistance
24 Forced Syra to leave Lebanon
25 Condemned the Russian attack on Georgia
26 Allows Secretary of State to go to UN with false evidence regarding Iraq
27 Won support for three U.N. Security Council resolutions imposing sanctions on Iran
28 Increased the number of free trade agreements from 3 to 14
29 Designated Iraq, Iran and North Korea as “Axis of Evil”
30 Implemented President’s Malaria Initiative in Africa
31 Increased money for medicine for AIDS suffering in Africa
32 Setup the Afghanistan government
33 Halved the nuclear weapon stockpile
34 Secured a commitment from N. Korea to end its nuclear weapon program
35 Watched as Israel attacked Lebanon
36 Iraq invasion
37 Massively increased aid to Africa
38 Got Libya to give up nukes
39 Tried to get Europe to deal with Iran
40 Watched as Israel attacked Gaza
41 Set up new government in Iraq
42 Forced N. Korea to work with multi-national panel
43 Dealt with China and the US spy plane
44 Remove Saddam Hussein
45 Afghanistan occupation
46 Afghanistan invasion
47 Gave Pakistan billions of dollars

Policy

48 Watched passively as Katrina hit New Orleans
49 Denied knowing Ken Lay from Enron
50 Created Project Safe Neighborhood
51 Lifted the Executive Ban on drilling on the Outer Continental Shelf
52 Kept reading children’s books on 9/11
53 Was elected in 2000
54 Made changes to allow necessary clean up of national forests to reduce fire damage
55 Reduced H1B visas from 195K per year to 66K per year
56 Substantially Increased Funding for the Great Lakes
57 Federal Energy and Carbon Sequestration Programs
58 Mandated a Cut in Mercury Emissions
59 Nuclear Power 2010 program
60 Exempt food from unilateral trade sanctions and embargoes
61 Established Papahānaumokuākea Marine National Monument
62 Put polar bear on endangered species list
63 Eased field-testing controls of genetically engineered crops
64 Tried to privatize Social Security
65 Reduced drug use among teens by 25%
66 Killed Kyoto Global Warming Treaty
67 issued an executive order that limits access to Presidential papers
68 Ethanol production has quadrupled from 1.6 billion gallons in 2000 to an estimated 6.5 billion gallons in 2007
69 Created the Commission on Care for America’s Returning Wounded Warriors
70 National Space Policy
71 Was re-elected in 2004
72 Created USA Freedom Corps
73 Appointed Supreme Court Associate Justice Samuel Alito
74 Appointed Supreme Court Chief Justice John Roberts
75 Stopped funding of new stem cells for research purposes
76 Reversed the requirement of parental consent for abortions
77 Issued an executive order regarding union dues being used for political campaigns against individual’s wishes
78 Challenged UN to not be the League of Nations
79 Stopped US involvement in International Criminal Court
80 Issued an EO implementing the Supreme Court’s Olmstead ruling
81 Established the The White House Office and the Centers for the Faith-Based and Community Initiative
82 Started the USA Freedom Corps
83 Supported the Law of the Sea treaty
84 Strengthen the National Health Service Corps
85 Ordered a 5 year plan to restructure each agency
86 Reorganized the intelligence agencies into the Department of Homeland Security
87 Put hundreds of thousands of government jobs up for bid
88 Banned partial birth abortions
89 Double the research budget of the National Institutes of Health
90 Enacted the Do Not Call list
91 No child left behind
92 Signed Teacher Protection Act
93 Interstate Air Quality Rule
94 Clear Skies Initiative to reduce air pollution
95 Prohibited federal fund for groups providing abortions

Terrorism

96 Detained foreign citizens in prison without due process
97 Increased border security and interior enforcement funding more than 110 percent
98 Attacked Al Qaida
99 Implemented a wire-tapping scheme to detect conversations with terrorists
100 Allowed torture of suspect terrorists
101 Told American’s to shop after 9/11
102 Dealt with anthrax scare
103 Signed the Patriot Act
104 Created Student and Exchange Visitor Information System (SEVIS) to monitor foreign students
105 Split the Immigration and Naturalization Service into two agencies
106 Signed the workplace verification bill to prevent hiring of illegal aliens.
107 Established a six-month deadline for processing immigration applications.
108 Told Americans that Islam was a religion of peace
109 Created the TSA
110 Created a new air monitoring system to detect harmful airborne agents
111 Signed 2 bills that arm pilots with handguns in the cockpit






And of course the one accomplishment that many people feel is the most important:


A couple of comments on the above list.

  • Yes, I know that there are more than 100 items on the list.  However, I didn’t want someone to say that two items were actually duplicate of each other.  For this reason, I felt that it was prudent to overshoot my goal of 100 in case a reader felt that some should have been excluded.
  • The links to many of the items are not meant to be the definitive source on that topic.  Rather, I wanted to remind the reader of the topic in case you didn’t remember that effort.  My hope was the link would lead you to the discovery of the issue and the action of the Bush Administration.  In the cases where I didn’t include a link, I felt that nearly everyone reading this list would understand those issues or could easily find more information by do a quick web search.
  • I titled this list as the 100 accomplishments.  I fully understand that many will feel that some of these items were failures.  That really isn’t the point.  My goal in creating the list was to try and identify the top 100 or so things that the administration did (or by inaction didn’t do). This is not a scorecard.
  • The list is not ordered by time or importance.  Do not take any inference in the numbering scheme.

Did I miss anything?

I am done with this topic for now but I reserve the right to rant more on it someday.

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RANT! What do we do with Social Security – 3 of 3

RANT! What do we do with Social Security – 3 of 3

For the last 2 posts, I have explained that social security is in real trouble and should be euthanized. Now I will explain how to do it in the most fair and compassionate way possible.

Our current generation of retirees (and soon-to-be retirees) needs to be protected in this whole process. Therefore my plan doesn’t require them to make any sacrifices. They had a contract with the US government and we need to keep that contract. So the first step of the process is that anyone 58 and over receives all of the benefits that they are currently supposed to receive.

The second step of the process is that since everyone that is 57 today has ten years to prepare for the change, they will receive 10% less than what they were supposed to receive as of today. They need to start saving to prepare for that day and stop looking to the government for a complete handout that is not going to happen. Besides, 10% is not that big of a sacrifice.

The third step is to reduce the gift each year by 2% times each additional year under 57. So, as I said above, 57 year old people are eligible in 2017 and they receive 10% less. Then everyone that will be 67 in 2018 will receive 12% less than today’s standard. 2019 retirees will receive 14%, 2020 retirees will receive 16% less, and so on.

This means that by 2062, Social Security will be gone. Good riddance. RIP! FDR should be proud, he created a system that took almost a century and a half to kill. Think about that – how many institutions today were started at the time of the US Civil War?

The fourth step is probably the most important. For every dollar that American’s pay into the Social Security system until it it has enough money to survive until 2062 (by my estimate that will be until about 2025, maybe 2030), we will be able to set aside another dollar into a specially declared savings account that can’t be touched until we are 67 and the principle and the interest will never be taxed. That savings program will continue and hopefully become the new 3rd rail that politicians can’t touch.

MY PLAN WILL HAVE SOCIAL SECURITY COMPLETELY FIXED BY 2062! NO OTHER PLAN CAN SAY THAT!

BTW, I will be 100 years old when SS is dead! I hope that I can live that long and I will do a jig if I am still able. If I do live that long, you can be confident that I will adequately prepare my finances so that I am not a burden on my children or society.

I am done with this topic for now but I reserve the right to rant more on it someday.

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