[SK in CV]

[quote=bearishgurl]
Actually, I think we should have the option of taking a lump sum of our contributions at 62. I’ve seen too many people die after working their entire lives without collecting a dime (exc spouse $250 benefit).

[/quote]

I have problems with that option, but almost that exact thing happened to my dad. He paid in maximum every single year from when FICA began (save for 2 years in the service during WWII) until he was 70. At that time, if you were still working and earning a living, you couldn’t collect until 70. He got exactly one check. And died.

[SK in CV]

[quote=AN]BG, what you say about gen before you will be what us Gen X/Y will say about your generation. I can say with a certainty your generation will live longer than the gen before you. You’ll have access to stuff like, new cancer treatments, new AIDS treatments, new body party replacements using your own stem cell, etc. So, yes, on average, Boomers WILL live longer than their parents. So, you will use more than you put in to SS.[/quote]

You’re probably right, but the difference isn’t all that great. Overall life expectancy has almost no bearing on calculation. What’s important is life expectancy AFTER benefits begin. Seventyish years ago, when SS benefits began being paid, infant mortality was much higher. Over 400,000 future SS recipients died in WWII. If I remember my stats right, people who lived until they were 65 had life expectancies about 5-6 years less than they do today. With normal retirement age already increasing to 67 over the next couple decades, most of that increase has already been factored into the calculation. That life expectance has not significantly increased over the last few decades. Whether it will in the future remains to be seen.

[SK in CV]

[quote=livinincali][quote=SK in CV]
How far can you go taxing the rich? That’s a good question. Certainly much farther than we’ve gone so far. We’ve done it in the past during boom times and they didn’t stop working, they didn’t get poorer as a whole. The rich have had extraordinarily low taxes over the last 10 years, when compared to prior decades.
[/quote]

There’s a theoretical Laffer curve which says there’s some optimal tax rate in which the most tax dollars. There’s probably also a curve for the most optimal tax rate for economic growth. History says the best economic time have been associated with an effective tax rate of around 18-20%. I could see revenue increases to 2.8, maybe a little higher but you still have a ton to cut. Of course with medicare and social security growing faster than GDP it just gets worse. In essence you need to slow the growth of SS and medicare to something less than GDP. Maybe the easiest solution is to just have people wanting to join those programs wait in a queue. You could arrange that queue based on need, but you stop the uncontrollable growth.

Based on the actions taken by many high wealth individuals towards the end of 2012 I’d be willing to bet right now that 2012 tax revenue is higher than 2013 tax revenue.[/quote]

I think your numbers are wrong wrt to the best economic times being when the effective tax rate was 18-20%. It’s been in that range during the last 10 years. During most of the 90’s, it was over 22%, and never dropped below 20% for more than the last 2 decades of the last century. I can’t quickly find numbers older than that, but I’ve seen some pretty well laid out arguments that the greatest economic growth has come when top tax rates were substantially higher than they are today.

Laffer was probably right that there is a optimal point on the curve, all else remaining equal. He was just way way low on where it is. He wasn’t even close.

[SK in CV]

[quote=livinincali]

How far can you go taxing the rich and putting the youth in debt until they say F U? Because once you get to that point you can’t take it back.[/quote]

How far can you go taxing the rich? That’s a good question. Certainly much farther than we’ve gone so far. We’ve done it in the past during boom times and they didn’t stop working, they didn’t get poorer as a whole. The rich have had extraordinarily low taxes over the last 10 years, when compared to prior decades.

As to debt, the question should be whether current levels are sustainable. Many of us live with high mortgages. Many with debt of three or four times our annual income. Often with the hope that we will have them all paid off by retirement age when we stop getting a paycheck.

But the government won’t retire. So the right thing to do is to maintain the debt, at sustainable levels in bad times, and pay it down in good times. We had that opportunity 10 years ago and it wasn’t done. We still can afford additional debt, but there is a limit.

As to the cost of medical care, while our system of health care delivery has improved, our system of paying for it remains irreparably broken.

[SK in CV]

[quote=moneymaker]Interest rates will go up but it won’t be the banks decision. I think there is a correlation between 30 year rates and people getting out of the bond market and back into securities. Right now conventional wisdom seems divided on wether it is going to be a good year for banks or not. I don’t know about this year but in my mind banks that carry mortgages are no different than the bond market, which I think more people are getting the idea to get out of.[/quote]

Banks don’t carry the mortgages. They make their fees and sell them.

[SK in CV]

[quote=AN]So, what you’re saying again, which is what I’m also saying, the house gave a budget that the democrat senate doesn’t like while the president gave a budget that the republican senate doesn’t like. But the Democrat controlled Senate doesn’t produce a budget of their own. So, like I said, it’s stuck in the Democrat controlled Senate.[/quote]

No. It is a fallacy to call the Senate “Democrat controlled”. In order to get to a vote, bills require 60 votes. Republicans in the Senate have held up more votes than any other Congress by far. In 2009, they held up twice as many votes as during a 20 year period a generation ago. It’s only gotten worse since then. Republicans have effectively held up votes on every substative issue, including budget resolutions. Democrats can’t get a bill passed if they can’t vote.

[SK in CV]

[quote=AN][quote=SK in CV]As I said, the 8 to 10% barely covers 1/2 of SE tax. If I remember correctly, she left Sharp and Scripps because both were permanent part time positions, to get more hours at other facilities. She has a specialty that is in high demand, but very few facilities need her specialty full time.[/quote]
But they have full benefits. Why not just stay put instead of moving somewhere else that only pay 10% more but then after all the benefits, you’re actually taking a pay cut?[/quote]

She’s my ex-wife. Need I say more?

(Actually, now that I’m thinking about it, in addition to more hours, I think she left both of them because they were too physically demanding. She has a bad back, and couldn’t lift patients anymore, and moved to facilities where she didn’t have to.)

[SK in CV]

[quote=AN]
Ok, so 10% of $80-100k = $8-10k. Wouldn’t that be enough to cover the health insurance. All the while, people who are not working for Sharp/Scripps can constantly try to get into Sharp/Scripps? Why did your ex-wife quit Scripps/Sharp?[/quote]

As I said, the 8 to 10% barely covers 1/2 of SE tax. If I remember correctly, she left Sharp and Scripps because both were permanent part time positions, to get more hours at other facilities. She has a specialty that is in high demand, but very few facilities need her specialty full time.

[SK in CV]

[quote=AN][quote=enron_by_the_sea][quote=AN]The other 2/3 have no room to complain about the bad budget from the other 1/3 if they haven’t passed one of their own. That’s the whole point of negotiation right? Put your budget on the table and see where they can come together?[/quote]

* Obama can’t “pass” budget but do not complain that he did not propose one .

http://money.cnn.com/2012/02/13/news/economy/obama_budget/index.htm%5B/quote%5D
Did that budget pass in the Democrat controlled Senate? How many Senator vote for it? So, what we have is, the House offered a budget, Obama offered a budget, and the Democrat controlled Senate is the road block?[/quote]

No, the President has presented budgets and while budget resolutions technically require only a majority vote, in order for the budget to take effect, it must survive a cloture vote on an identical bill passed in the House. It was effectively (though not technically) filibustered by Republicans in the Senate.

[SK in CV]

[quote=AN][quote=SK in CV][quote=AN]Interesting, I didn’t know that. That would suck for people in those industry. Why would people do freelance in those industry then. It doesn’t make any sense to me.[/quote]

Because that’s what the market pays, and there are limited employee positions available. It’s not exactly “freelance” work. Many are long term part and full-time per diem contract positions. Slightly higher pay that barely covers 1/2 the SE tax, but no benefits. It’s just how some industries work.[/quote]
Why don’t those contractors say to their employer to let them be full time and they’ll take a pay cut?[/quote]

If only it were that simple. My dear ex-wife is an allied health professional. She’s reasonably well paid, between $80 and $100K a year for most of the last 20 years, but most of that time she worked multiple permanent part time per diem or hourly positions, never worked for the same company for more than 5 or 6 years. Despite her specialty being in relatively high demand, only two of her probably 20 employers over that time offered W-2 positions to licensees (scripps and sharp). All the rest were independent contractor positions.

[SK in CV]

[quote=livinincali][quote=SK in CV]
Except we haven’t taxed more. And we haven’t spent much more. Taxes have gone down for almost everyone over the last 4 years. And spending is growing at the smallest rate in decades, and most of that increase has been purely a function of the economy and demographics.[/quote]

Notice how revenues have stagnated over the past 10 years yet spending has increased. Revenues are based on number of people working, their nominal wage gains and the tax rate. Everybody agrees that wages have stagnated. Look at a chart of number of people working and that hasn’t gone up much, and the tax rate has basically remained the same or gone down.[/quote]

If you go back another couple years, revenue decreased over the last 12 years. If revenue had simply kept up with inflation since 2000, the current budget would be balanced. Revenues are not solely based on the number of people working. It’s also based on the effective tax rates on all income.

Again, much of the increase in entitlement spending is purely demographics, and more recently, a function of the economy, not statutory increases in entitelments. Almost 1/3 of the increase in entitelment costs are SS old age benefits, yet SS as a whole still does not materially contribute to the deficit. And net OASI taxes collected (including SE tax) increased by more than 1/3. (SS benefits paid are roughly equal to additions to the SS trust fund.)

[SK in CV]

[quote=AN]Interesting, I didn’t know that. That would suck for people in those industry. Why would people do freelance in those industry then. It doesn’t make any sense to me.[/quote]

Because that’s what the market pays, and there are limited employee positions available. It’s not exactly “freelance” work. Many are long term part and full-time per diem contract positions. Slightly higher pay that barely covers 1/2 the SE tax, but no benefits. It’s just how some industries work.

[SK in CV]

[quote=AN]BG, I had HMO before and I went to both Sharps and Scripps. So, you don’t have to get Kaiser’s HMO. I’m not self employed, so I don’t have to worry about self-employing. However, my point is, freelancers tend to get paid about 80-100% higher than their W-2 counter part. That 80-100% extra pay is supposed to be for paying for these insurance and such. If you don’t want to deal with that, you can try and get a job at a corporation then. They’ll take care of your health insurance for you.

[/quote]

The bolded part. It isn’t true in most industries for the equivilent of full time work. In health care, for instance, it tends to be 10% more at the top of the scale.

[SK in CV]

[quote=SD Realtor]Well SK you paint a portrait that indeed everything is okay and perfectly acceptable. I guess we simply agree to disagree.[/quote]

No, I haven’t said that at all. The economy is still limping along. More than 12 million people who want jobs don’t have them. I don’t think there’s any part of that which is acceptable.

[SK in CV]

[quote=SD Realtor]Of course it is the economy.

Thus the senate is then justified in not passing a budget since 2009, and the govt in general is continuing to spend a trillion more then it takes in because it will all take care of itself when the economy heals.

In the meantime it is okay to spend more and tax more.

Because that is (speculation about the economy aside) exactly what we are doing.[/quote]

Except we haven’t taxed more. And we haven’t spent much more. Taxes have gone down for almost everyone over the last 4 years. And spending is growing at the smallest rate in decades, and most of that increase has been purely a function of the economy and demographics.

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