Growth in Social Security Take

Your inflation list sez

"$1.00 in 1937 had about the same buying power as $15.02 in 2009." Current dollar power then is 1/15.02 or 0.0666 of that in 1937.

Your rate table sez

1% in 1937 went up to 15.3% in 1990 and later. An increase of, well, you get it, 15.3 times.

Without knowing a person's total earnings, max taxable doesn't do anything for me. I will assume all earnings are taxable, as mine are, which means I don't need that figure.

So, 15.3 x 0.0666 = 1.019... Damn close to parity.

This can't be right. How am I missing the 36x increase?

I have mixed feelings about Medicare...

It's a Ponzi scheme. It pays highly discounted fees to doctors, etc. But it, in "free" form, covers only basic medical care and requires substantial "co-pays". Thus I have to pay premiums for Part-B and Part-D, plus a premium to a "supplemental" (private) insurer... out of pocket ~$500/month.

That combination is _wonderful_. I receive excellent and speedy treatment.

Wait until you're pushing 70 and let me know what you think then (if Obama hasn't already declared you "surplus ;-)

...Jim Thompson

--
| James E.Thompson, P.E.                           |    mens     |
| Analog Innovations, Inc.                         |     et      |
| Analog/Mixed-Signal ASIC\'s and Discrete Systems  |    manus    |
| Phoenix, Arizona  85048    Skype: Contacts Only  |             |
| Voice:(480)460-2350  Fax: Available upon request |  Brass Rat  |
| E-mail Icon at http://www.analog-innovations.com |    1962     |
             
 I love to cook with wine     Sometimes I even put it in the food

The maximun Taxable earnings in 1937 was $3000 at 1% tax rate so you paid $30. $30 in 1937 is equivalant to $450 in todays dollars. The Maximum Taxable earning today is $106,400 you pay 15.3%. That is $16,279. $16,279 / $450 = 36.1

Working your way;

To find what we pay today in 1937 dollars we multiply .0666 x $106,400 = $7086

The rate today is 15.3% so .153 x $7086 = $1063

In 1937 we paid $30 on our $3000.

Then $1063 / $30 = 35.4

If my logic is wrong someone else needs to explain it to me. I didn't follow your logic and you have spouted so much nonsense I wouldn't believe you anyway. Have a nice day, Mike

Jim, I can't argue that its not _wonderful_ , anytime someone else buys you something expensive it's wonderful. But is it good for society as a whole to pay for something you could pay for youself. It might get into your expensive wine drinking, is that to high a price to pay? Maybe :-) Jim would you check my logic and math, I'm not absolutely sure I have it right, at a 36 multiple. Seems unbelievable, and it's still going broke.

Mike

So, what you are saying is, I have to switch jobs too?

If I made $3000 in 1937, based on inflation I'd be making $45,060 today, not $106,400.

If you want to switch jobs in the middle, you'll need a ratio.

Well, I guess now you understand why the governemnt has outlawed all Ponzi schemes except their own...

By using your non-existant math skills? Did you make it through the third grade (yet?)

Null response.

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15.3% of your entire income versus 1% of a smaller portion of your income.

It's a bigger chunk no matter how you spin it. As it must be, since, like the car companies and the UAW, fewer and fewer working people are supporting more and more retired people.

Cheers, James Arthur

No same job, making $7,068 in 1937, with a tax rate of 1% on the first $3,000

That's correct.

But now your taxed up to $106,400.

I see your error now, inflation and the increase in tax rate are a wash but the max limit that you pay on is 36 times higher. Mike

I made no error. Your problem setup was "Between 1937 and 2009, I calculate it as 36** times increase in the amount government takes from you to pay for social security." - but apparently you meant "maximum amount the government can take from you" instead.

Ok, so a large amount of people are paying 36 times more than they would have in 1937. And I don't believe you think a plan that started with 36 people supporting

1 person, can survive on the same dollars (inflation adjusted) now that we have 3 people supporting 1. The point was if you start a government program, it grows and grows and grows! Pretty soon we're going to run out of money, Oh, we already have, trillion in debt, social security is going broke. When will you grow up and realize goverment takes to much and is inefficient with what they take. Mike

You left out the "up to" again. It would be interesting to see actual figures.

Nice hypothesis. You now have one data point.

Means testing, problem gone. So's your data point.

So two families earning an average of $40,000 a year four 40 years. Family #1 lives very frugally and has $800,000 of assets at retirement. Family #2 lives paycheck to paycheck and retires with partially paid for house and debt for two cars and credit cards. Assets of $26,000. Now you think family #1 should not get the benefit of the money they paid into the system but family #2 should! Ever heard the term personal responsibility? Mike

I shouldn't point this out, but I will, just for fun ;-)

The more you pump into SS, the more you get back, though nothing like you would with private investments.

Thus a whole bunch of you yellow-belly leftist-weenies are paying dearly to provide MY large SS retirement income... Bwahahahahaha ;-)

...Jim Thompson

--
| James E.Thompson, P.E.                           |    mens     |
| Analog Innovations, Inc.                         |     et      |
| Analog/Mixed-Signal ASIC\'s and Discrete Systems  |    manus    |
| Phoenix, Arizona  85048    Skype: Contacts Only  |             |
| Voice:(480)460-2350  Fax: Available upon request |  Brass Rat  |
| E-mail Icon at http://www.analog-innovations.com |    1962     |
             
    Obama: A reincarnation of Nixon, but without ANY scruples, 
           masquerading in politically-correct black-face.

800K would require saving $28,500.00 @ 5.5% interest ( compounded annually). At 10%, it's $17,000.00. Just don't have a down year. Assuming the 40K is post-tax, 17k leaves a monthly budget of $1,916.

You can do this with 401k plans, but what happens when 40% of GDP floods into the stock market every year? Yields plummet, earnings per share goes to .. zero, really. Gettin 10%? Only if you manage to ride a Ponzi wave....

And now assume everybody - *everybody* - is saving proportionally the same. Guess what interest rates on savings were in Japan in the '90s ( where they did this )? As low as 0.5%. That requires *more than* 40K per year in savings.

Just saying - it's like thermodynamics - you can't win, you can't break even, and you can't quit the game.

Saving is in a person's self interest. Spending is in everybody else's self-interest. You can't easily frame a moral objection in terms of self-interest, unless there's a tort. Taxes ain't torts.

-- Les Cargill

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us.

What Jim hasn't noticed that he could get the same level of care in France or Germany for about half the price. He'd also be paying for the system to provide much the same level of care for his indigent neighbours, but he'd still only be paying half what it costs him in the US.

The US system can provide good health care for the well-off, but it is ridiculously expensive. Some of the extra money being wasted on over- treatment to minimise the doctor's risk of being suded for malpractice, and quite a lot more on malpractice insurance, but a large chunnk of the xtra money is pure profit for the medical insurance business, which is why they are now funding the sort of idiotic propaganda that Jim (amongst other) has been peddling here recently.

-- Bill Sloman, Nijmegen

Two problems with your assumptions: First, if they were taking some percentage of the first $3000 back in 1937, then they shold be taking some percentage of only the first $45,000 today. Not $106,400.

Second, if we're talking about parity with inflation, then taking 1% of $3000 back in 1937 would be the equivalent of taking 1% of $45,000 today. Not 15.3%.

--
Paul Hovnanian     mailto:Paul@Hovnanian.com
------------------------------------------------------------------
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replaces it with.       -- Tennessee Williams

Check your math, 40 years x $20,000 is $800,000 without any interest.

If you saved $10,000 for the first 12 yrs only, @ 5.5% interest for 40 years you would have over $800,000, The next 28 years of savings could pay for Jim's extravagances. :-)

Mike