Comments on: Survey: Half Of Workers Would Opt Out Of Social Security If They Could http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could Building a conservatism that can win again Sat, 11 Feb 2012 17:50:44 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: agbiggs http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could/comment-page-1#comment-50622 agbiggs Fri, 20 Mar 2009 14:28:44 +0000 #comment-50622 dendup: I did something of an update of the market risk paper here (http://www.aei.org/publications/filter.all,pubID.28971/pub_detail.asp). The key finding was that people retiring today would not have suffered great losses had Social Security accounts been passed. Had accounts been in place for workers' entire lives, a typical worker retiring in late 2008 would have increased his total Social Security benefits by around 15%. The reason for this is that today's terrible returns would have been matched by higher returns in previous years. <br><br>Even if accounts were passed just a few years ago and people started accounts as the market was beginning to decline, losses would have been very small (under 1% of total benefits). The reason is first, the amounts invested in accounts would have been small, and second, under the Bush plan accounts would automatically shift to a "life cycle" portfolio that had older workers holding very little stocks. dendup: I did something of an update of the market risk paper here (http://www.aei.org/publications/filter.all,pubID.28971/pub_detail.asp). The key finding was that people retiring today would not have suffered great losses had Social Security accounts been passed. Had accounts been in place for workers’ entire lives, a typical worker retiring in late 2008 would have increased his total Social Security benefits by around 15%. The reason for this is that today’s terrible returns would have been matched by higher returns in previous years. Even if accounts were passed just a few years ago and people started accounts as the market was beginning to decline, losses would have been very small (under 1% of total benefits). The reason is first, the amounts invested in accounts would have been small, and second, under the Bush plan accounts would automatically shift to a “life cycle” portfolio that had older workers holding very little stocks.

]]> By: Ind55 http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could/comment-page-1#comment-53141 Ind55 Tue, 17 Mar 2009 22:43:56 +0000 #comment-53141 Andrew Biggs seems correct (pending information on the wording of the questions) in saying that this survey shows a remarkable level of concern about SS. I'd guess that people are voting that the Federal debt is growing so fast today that it will become too big to allow SS benefits. However, the real policy question would be worded something like this "Would you opt out of SS, if that meant you paid no more taxes, forfeited your benefits, and that currently retired people would see their benefits immediately drop to zero?" Or, maybe, "Would you opt for a system where SS taxes continue at their current rate, your future benefits are about 75% of the current schedule, and you are also required to pay __ percent of your current income into a government mandated savings program with these restrictions [ enter whatever investment and withdrawal restrictions seem likely here ]" These questions are more representative of the actual decisions we need to make. Andrew Biggs seems correct (pending information on the wording of the questions) in saying that this survey shows a remarkable level of concern about SS. I’d guess that people are voting that the Federal debt is growing so fast today that it will become too big to allow SS benefits.

However, the real policy question would be worded something like this “Would you opt out of SS, if that meant you paid no more taxes, forfeited your benefits, and that currently retired people would see their benefits immediately drop to zero?”

Or, maybe, “Would you opt for a system where SS taxes continue at their current rate, your future benefits are about 75% of the current schedule, and you are also required to pay __ percent of your current income into a government mandated savings program with these restrictions [ enter whatever investment and withdrawal restrictions seem likely here ]”

These questions are more representative of the actual decisions we need to make.

]]> By: dendup http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could/comment-page-1#comment-52364 dendup Tue, 17 Mar 2009 17:59:53 +0000 #comment-52364 agbiggs: My point in mentioning that you reprinted much of a press release is this - we don't know the actual wording of the questions and we don't know all the response breakdowns. The methodology appears sound, but again, there's a lot we don't know. What we do get is the company's characterizations of the results without the data to come to our own conclusions. I've worked on enough opinion research to be suspicious when a presentation consists only of the characterizations that support the case being made. After all they are selling something here. I do not mean to imply that "unretirement" isn't a real problem which is why I reference the Gallup info. But rather than a possibly self serving press release, I would be more interested in you updating your 2001 article on SS privitization. http://www.socialsecurity.org/pubs/articles/art-biggs010410.html agbiggs: My point in mentioning that you reprinted much of a press release is this – we don’t know the actual wording of the questions and we don’t know all the response breakdowns. The methodology appears sound, but again, there’s a lot we don’t know. What we do get is the company’s characterizations of the results without the data to come to our own conclusions. I’ve worked on enough opinion research to be suspicious when a presentation consists only of the characterizations that support the case being made. After all they are selling something here. I do not mean to imply that “unretirement” isn’t a real problem which is why I reference the Gallup info. But rather than a possibly self serving press release, I would be more interested in you updating your 2001 article on SS privitization.
http://www.socialsecurity.org/pubs/articles/art-biggs010410.html

]]> By: dacookson http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could/comment-page-1#comment-41767 dacookson Tue, 17 Mar 2009 17:33:15 +0000 #comment-41767 Sorry to be pedantic but isn't forced retirement savings the same as insurance? It's insurance against not having enough money in the bank when you retire to live independently. I'm a bit out of my depth I admit, but how would splitting the system help? You can't use the private sector because of the inherent risk so why have two government funds when one will do? Sorry to be pedantic but isn’t forced retirement savings the same as insurance? It’s insurance against not having enough money in the bank when you retire to live independently. I’m a bit out of my depth I admit, but how would splitting the system help? You can’t use the private sector because of the inherent risk so why have two government funds when one will do?

]]> By: agbiggs http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could/comment-page-1#comment-45705 agbiggs Tue, 17 Mar 2009 15:49:46 +0000 #comment-45705 Sinz54: For what it's worth, Social Security is PART insurance, but a good part is simply forced saving. Yes, Social Security pays insurance benefits to the disabled and survivors, and acts as a welfare program by redistributing to poor retirees. But much -- probably most -- of the taxes received and benefits paid are simply requiring people to save for retirement through Social Security, when we could just as easily require them to save through other means. If we can establish universal retirement savings, then a smaller Social Security can fulfill the program's insurance functions more effectively. Dendud: I also looked for the exact question wording, but couldn't' find how they phrased things, which is important. It appears they did tell folks that if they opted out they also lost their benefits, which is key. Sinz54: For what it’s worth, Social Security is PART insurance, but a good part is simply forced saving. Yes, Social Security pays insurance benefits to the disabled and survivors, and acts as a welfare program by redistributing to poor retirees. But much — probably most — of the taxes received and benefits paid are simply requiring people to save for retirement through Social Security, when we could just as easily require them to save through other means. If we can establish universal retirement savings, then a smaller Social Security can fulfill the program’s insurance functions more effectively.

Dendud: I also looked for the exact question wording, but couldn’t’ find how they phrased things, which is important. It appears they did tell folks that if they opted out they also lost their benefits, which is key.

]]> By: dacookson http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could/comment-page-1#comment-52829 dacookson Tue, 17 Mar 2009 01:27:55 +0000 #comment-52829 sinz54's point is right of course, SS is insurance. The fact that it is universal and mandatory is because the government realised that a lot of people, including investment bankers, tend to think short term. The SS insurance protects society from the negative effects that would come with poverty, increased crime, begging, people becoming unemployable, full hospitals and so on. It's not perfect at the moment by any means, but it is logically sound and the same principles apply to healthcare. It's another issue that has been utterly clouded by ideology and short term thinking. When you pay SS you are paying for your own security even if you never draw on it yourself, it's in everyone's interest to make it work. 'You are less likely to be mugged with SS' would be my slogan... sinz54’s point is right of course, SS is insurance. The fact that it is universal and mandatory is because the government realised that a lot of people, including investment bankers, tend to think short term. The SS insurance protects society from the negative effects that would come with poverty, increased crime, begging, people becoming unemployable, full hospitals and so on. It’s not perfect at the moment by any means, but it is logically sound and the same principles apply to healthcare. It’s another issue that has been utterly clouded by ideology and short term thinking. When you pay SS you are paying for your own security even if you never draw on it yourself, it’s in everyone’s interest to make it work. ‘You are less likely to be mugged with SS’ would be my slogan…

]]> By: dendup http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could/comment-page-1#comment-46865 dendup Mon, 16 Mar 2009 19:58:48 +0000 #comment-46865 The Sun Life website didn't include the actual questions or response breakdowns. so its dificult to really draw any conclusions about what it said. (Other than we should all go out and but Sun Life annuities.) That aside, http://www.gallup.com/poll/107146/One-Five-Americans-Expect-Work-Retirement.aspx provides perhaps a more neutral picture of "unretirement" (SL word for the problem its products address.) So other than printing an insurance company press release, what does this article say? SS has problems of both funding and public confidence and Reps should come up with something better than Bush did. Even as a liberal, I can get behind that. As to the effects of asset ownership Andrew discusses, the words chicken and egg come to mind. Sinz makes an important point about the insurance aspect of SS. The Sun Life website didn’t include the actual questions or response breakdowns. so its dificult to really draw any conclusions about what it said. (Other than we should all go out and but Sun Life annuities.) That aside, http://www.gallup.com/poll/107146/One-Five-Americans-Expect-Work-Retirement.aspx provides perhaps a more neutral picture of “unretirement” (SL word for the problem its products address.) So other than printing an insurance company press release, what does this article say? SS has problems of both funding and public confidence and Reps should come up with something better than Bush did. Even as a liberal, I can get behind that. As to the effects of asset ownership Andrew discusses, the words chicken and egg come to mind. Sinz makes an important point about the insurance aspect of SS.

]]> By: sinz54 http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could/comment-page-1#comment-42382 sinz54 Mon, 16 Mar 2009 19:14:22 +0000 #comment-42382 SS is not an investment program like a 401(k). It's an insurance program, with old age, death, and disablement benefits. Last year, I became sick and disabled (kidney failure). I qualified for SS disability payments, which helps pay my bills now that I'm no longer working. Folks w-h-o would like to opt out of the SS system don't think much about that. I bet that many of them don't have private Long Term Disability (LTD) insurance. So without SS, if they became disabled like me due to sudden illness or accident, they would have no recourse. SS is not an investment program like a 401(k). It’s an insurance program, with old age, death, and disablement benefits. Last year, I became sick and disabled (kidney failure). I qualified for SS disability payments, which helps pay my bills now that I’m no longer working. Folks w-h-o would like to opt out of the SS system don’t think much about that. I bet that many of them don’t have private Long Term Disability (LTD) insurance. So without SS, if they became disabled like me due to sudden illness or accident, they would have no recourse.

]]> By: JJWFromME http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could/comment-page-1#comment-53292 JJWFromME Mon, 16 Mar 2009 18:09:59 +0000 #comment-53292 The main reason their confidence is shaken is because of sustained fear mongering campaigns blowing the problem out of proportion. If nothing is done, there will be no problem until 2042. And even then, benefits will be paid at 75%, still better than today's SS recipients adjusting for inflation. Also, if you explain to them that "opting out" defeats the way the program is supposed to work, I bet you'd get a different polling result: http://www.washingtonmonthly.com/archives/individual/2008_09/014810.php If the fear mongering had more than an ideological slant, you would start with Medicare, which is actually in trouble. (But that's a policy area that conservatives are much less comfortable discussing, because they wouldn't like the resolution of that discussion.) The main reason their confidence is shaken is because of sustained fear mongering campaigns blowing the problem out of proportion. If nothing is done, there will be no problem until 2042. And even then, benefits will be paid at 75%, still better than today’s SS recipients adjusting for inflation. Also, if you explain to them that “opting out” defeats the way the program is supposed to work, I bet you’d get a different polling result:
http://www.washingtonmonthly.com/archives/individual/2008_09/014810.php
If the fear mongering had more than an ideological slant, you would start with Medicare, which is actually in trouble. (But that’s a policy area that conservatives are much less comfortable discussing, because they wouldn’t like the resolution of that discussion.)

]]> By: gblittle http://www.frumforum.com/survey-half-of-workers-would-opt-out-of-social-security-if-they-could/comment-page-1#comment-47381 gblittle Mon, 16 Mar 2009 17:45:25 +0000 #comment-47381 As much as I wish SS would change, be revamped, done away with -- your last sentence will hold true -- sad but true. As much as I wish SS would change, be revamped, done away with — your last sentence will hold true — sad but true.

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