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Penyprity
Skeptic Friend
64 Posts |
 Posted - 09/05/2007 : 18:32:19 [Permalink]
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Originally posted by JohnOAS
Originally posted by Penyprity
Originally posted by JEROME DA GNOME
By the way, Social Security is a Ponzi scheme. You are better off being out of that system. It does suck that they confiscated your production from labor.
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I dont know what you mean by 'Ponzi'.
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The introductory text from Wikipedia's article is a pretty good summary:
| A Ponzi scheme is a fraudulent investment operation that involves paying abnormally high returns ("profits") to investors out of the money paid in by subsequent investors, rather than from net revenues generated by any real business. |
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Thank you for the definition. Given that definition, I must disagree that Social Security is a Ponzi scheme. But I also think this would be another thread. I only brought it up to make my point about my company not having tax support.
A useful thing to know about in the grander scheme of things. If you're out and about on the Internet, sooner or later you're bound to bump in to a ponzi scheme or three. If you understand pyramid schemes in general, you're essentially there.
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Boy, thats true.
A completely fallacious comparison in relation to social security, but it seems to me that Jerome loves that sort of thing.
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So I am learning, but it makes for interesting reading. |
Make your vote count. Become a supreme court justice......Peny |
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JEROME DA GNOME
BANNED
2418 Posts |
 Posted - 09/07/2007 : 19:42:42 [Permalink]
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A Ponzi scheme tells you that if you put in a small amount now you will receive a larger amount later from others. Please explain how Social Severity is not a Ponzi scheme.
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What a man believes upon grossly insufficient evidence is an index into his desires -- desires of which he himself is often unconscious. If a man is offered a fact which goes against his instincts, he will scrutinize it closely, and unless the evidence is overwhelming, he will refuse to believe it. If, on the other hand, he is offered something which affords a reason for acting in accordance to his instincts, he will accept it even on the slightest evidence. The origin of myths is explained in this way. - Bertrand Russell |
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JohnOAS
SFN Regular
Australia
800 Posts |
Posted - 09/07/2007 : 21:36:49 [Permalink]
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Originally posted by JEROME DA GNOME
A Ponzi scheme tells you that if you put in a small amount now you will receive a larger amount later from others. Please explain how Social Severity is not a Ponzi scheme.
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Kind of makes me wonder why we needed a different word then.
I can't think of any investment scheme that doesn't promise a return greater than unity at some future time.
Excuse me while I get started on drafting letters reporting my bank, superannuation fund, stock broker and accountant to the appropriate authorities.
BTW, would you please explain the "social severity" joke to me, if it was deliberate. |
John's just this guy, you know. |
| Edited by - JohnOAS on 09/07/2007 21:37:48 |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 09/07/2007 : 21:44:34 [Permalink]
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Actually, Social Security is very much like a Ponzi scheme now. Older people today are being paid out with the money put in by younger people today. Few seem to disagree that eventually there are going to be too many old people and not enough young people for the status quo to continue. That will lead to Social Security's collapse, just like it leads to every single Ponzi scheme's collapse.
But, this only happened to Social Security because it's been a political football. When it was conceived, it was never intended to be a retiree's sole source of income (and people paid into it something like 12% of what we pay into it today), but now people feel entitled to just that, so that's what Congress has done to it. Plus, when there's been a decent surplus in the fund, Congress has usurped it, and not repaid it. |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 09/07/2007 : 21:52:14 [Permalink]
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Originally posted by JohnOAS
I can't think of any investment scheme that doesn't promise a return greater than unity at some future time.
Excuse me while I get started on drafting letters reporting my bank, superannuation fund, stock broker and accountant to the appropriate authorities. |
Ponzi schemes can't actually generate the return-on-investment that they promise. They use the investments from later investors to make it look like the early investors got paid from their fantastic investment plans, when they did not.
Banks, funds, brokers and accountants usually can grow your money as promised, if not moreso because they take some of the growth for their own profit. Paying your dividends doesn't require them to sign up five or ten more customers. |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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JEROME DA GNOME
BANNED
2418 Posts |
Posted - 09/07/2007 : 22:09:16 [Permalink]
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JohnOAS asked:
BTW, would you please explain the "social severity" joke to me, if it was deliberate. |
It was initially a typo. It seemed to fit, so I left it. 
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What a man believes upon grossly insufficient evidence is an index into his desires -- desires of which he himself is often unconscious. If a man is offered a fact which goes against his instincts, he will scrutinize it closely, and unless the evidence is overwhelming, he will refuse to believe it. If, on the other hand, he is offered something which affords a reason for acting in accordance to his instincts, he will accept it even on the slightest evidence. The origin of myths is explained in this way. - Bertrand Russell |
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Penyprity
Skeptic Friend
64 Posts |
Posted - 09/08/2007 : 11:48:26 [Permalink]
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Originally posted by Dave W.
Actually, Social Security is very much like a Ponzi scheme now. Older people today are being paid out with the money put in by younger people today. Few seem to disagree that eventually there are going to be too many old people and not enough young people for the status quo to continue. That will lead to Social Security's collapse, just like it leads to every single Ponzi scheme's collapse.
But, this only happened to Social Security because it's been a political football. When it was conceived, it was never intended to be a retiree's sole source of income (and people paid into it something like 12% of what we pay into it today), but now people feel entitled to just that, so that's what Congress has done to it. Plus, when there's been a decent surplus in the fund, Congress has usurped it, and not repaid it.
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This is very true. Not to mention that we are living longer than we used to. So the amount of pay out has increased because we are around longer. If Congress had left it alone, it would be working fine and the future of Social Security would be safe. Even with the baby boomers starting to retire. Social Security was supposed to be a supliment to retirement, not the entire income for a retiree.
But to call it a ponzi scheme...I still dont think so. Unless you die relatively young, you will probably get more out of it than you ever put in. And with more and more young people entering the work force... I dont think Social Security will just go away. |
Make your vote count. Become a supreme court justice......Peny |
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JEROME DA GNOME
BANNED
2418 Posts |
Posted - 09/08/2007 : 13:14:49 [Permalink]
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Originally posted by Penyprity
This is very true. Not to mention that we are living longer than we used to. So the amount of pay out has increased because we are around longer. If Congress had left it alone, it would be working fine and the future of Social Security would be safe. Even with the baby boomers starting to retire. Social Security was supposed to be a supliment to retirement, not the entire income for a retiree. |
The most you can currently pay in per year today is $5,580 plus $5,580 from the employer. This is $11,160 per year. Assuming inflation corresponds with wage increases this is a maximum of a little over $500,000 you would have payed in over a 45 year working career. | The average monthly payment is $895, or $10,740 a year. |
http://www.socsec.org/publications.asp?pubid=507
At this level of payment a retiree would need to live 46 and 1/2 years after the age of 65 just to break even. How many 111 year olds do you know?
Lets assume a worker that only pays half as much as the maximum. This worker still needs to live until the age of 88 to break even.
Keep in mind that whist this money is deducted from the workers check each week that is money that they can not pay debt with; thus interest on debts not payed and everything costs more. This also is a detriment to the worker. This program cost a lot more than it seems on the face.
But to call it a ponzi scheme...I still dont think so. Unless you die relatively young, you will probably get more out of it than you ever put in. And with more and more young people entering the work force... I dont think Social Security will just go away.
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Remember that congress doubled the social security tax in the early 1980's. They have increased its funding. I do not see how this squares with your assertion that if left alone it would have been " working fine and the future of Social Security would be safe." If congress had not increased the taxes collected the system would have been gone long ago. |
What a man believes upon grossly insufficient evidence is an index into his desires -- desires of which he himself is often unconscious. If a man is offered a fact which goes against his instincts, he will scrutinize it closely, and unless the evidence is overwhelming, he will refuse to believe it. If, on the other hand, he is offered something which affords a reason for acting in accordance to his instincts, he will accept it even on the slightest evidence. The origin of myths is explained in this way. - Bertrand Russell |
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Valiant Dancer
Forum Goalie
USA
4826 Posts |
Posted - 09/08/2007 : 20:58:04 [Permalink]
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Originally posted by JEROME DA GNOME
A Ponzi scheme tells you that if you put in a small amount now you will receive a larger amount later from others. Please explain how Social Severity is not a Ponzi scheme.
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BUZZZZZZZZZZZ! Tacky buzzer. Got to your room and eat a booger.
A Ponzi scheme is where previous investors are paid by the current investors. Person A joins. They put in $100. Ponzi scheme drinks the $50 in beer. Porson B joins a month later for $100. Ponzi pays $100 to person A and buys more beer. |
Cthulhu/Asmodeus when you're tired of voting for the lesser of two evils
Brother Cutlass of Reasoned Discussion |
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Penyprity
Skeptic Friend
64 Posts |
Posted - 09/08/2007 : 21:46:30 [Permalink]
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Originally posted by JEROME DA GNOME
Originally posted by Penyprity
This is very true. Not to mention that we are living longer than we used to. So the amount of pay out has increased because we are around longer. If Congress had left it alone, it would be working fine and the future of Social Security would be safe. Even with the baby boomers starting to retire. Social Security was supposed to be a supliment to retirement, not the entire income for a retiree. |
The most you can currently pay in per year today is $5,580 plus $5,580 from the employer. This is $11,160 per year. Assuming inflation corresponds with wage increases this is a maximum of a little over $500,000 you would have payed in over a 45 year working career. | The average monthly payment is $895, or $10,740 a year. |
http://www.socsec.org/publications.asp?pubid=507
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What kind of fuzzy math is this. 45 years ago, the average wage wasnt $5,580 a year, so they sure werent paying in nearly that much. Also, most people these days dont work 45 years before they retire.
At this level of payment a retiree would need to live 46 and 1/2 years after the age of 65 just to break even. How many 111 year olds do you know?
Lets assume a worker that only pays half as much as the maximum. This worker still needs to live until the age of 88 to break even.
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Not true. Since they started off paying way less then you suggested. Also, your break even point does not include what the employer pays in for you. We are talking about what comes out of your pocket and goes back into your pocket...right?
Keep in mind that whist this money is deducted from the workers check each week that is money that they can not pay debt with; thus interest on debts not payed and everything costs more. This also is a detriment to the worker. This program cost a lot more than it seems on the face.
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You dont think they should have been paying into some kind of retirement plan, and that perhaps the debt they created was their own bad judgement? I suspect that if a person needs the money that is going to social security to pay their debts, they would be spending that money unwisely as well. Yes, it would be theirs to do with as they wished, but when they get older and dont want to work anymore, they will still have debt(no doubt) and no retirement income at all.
But to call it a ponzi scheme...I still dont think so. Unless you die relatively young, you will probably get more out of it than you ever put in. And with more and more young people entering the work force... I dont think Social Security will just go away.
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Remember that congress doubled the social security tax in the early 1980's. They have increased its funding. I do not see how this squares with your assertion that if left alone it would have been " working fine and the future of Social Security would be safe." If congress had not increased the taxes collected the system would have been gone long ago.
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The government was taking money out of social security way before the 1980s. Money they never paid back. So they doubled the tax to rescue their own mis-managed funds. I am suggesting that if they never screwed with it in the first place, it would have been just fine.[quote] |
Make your vote count. Become a supreme court justice......Peny |
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JEROME DA GNOME
BANNED
2418 Posts |
Posted - 09/09/2007 : 07:44:11 [Permalink]
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Originally posted by Penyprity
What kind of fuzzy math is this. 45 years ago, the average wage wasnt $5,580 a year, so they sure werent paying in nearly that much. Also, most people these days dont work 45 years before they retire. |
Inflation. The cost of goods is comparable to wages over time.
| Not true. Since they started off paying way less then you suggested. Also, your break even point does not include what the employer pays in for you. We are talking about what comes out of your pocket and goes back into your pocket...right? |
Inflation. I did include what the employer pays. This is a tax on the employees labor.
| You dont think they should have been paying into some kind of retirement plan, and that perhaps the debt they created was their own bad judgement? I suspect that if a person needs the money that is going to social security to pay their debts, they would be spending that money unwisely as well. Yes, it would be theirs to do with as they wished, but when they get older and dont want to work anymore, they will still have debt(no doubt) and no retirement income at all. |
So, because you suspect that people make incorrect choices the government should take their money and as you said mis-manage it? I do not understand this logic.
| The government was taking money out of social security way before the 1980s. Money they never paid back. So they doubled the tax to rescue their own mis-managed funds. I am suggesting that if they never screwed with it in the first place, it would have been just fine. |
As you see the system is a slush fund for the government on the backs of the common worker. Why again do you think this is a good system? |
What a man believes upon grossly insufficient evidence is an index into his desires -- desires of which he himself is often unconscious. If a man is offered a fact which goes against his instincts, he will scrutinize it closely, and unless the evidence is overwhelming, he will refuse to believe it. If, on the other hand, he is offered something which affords a reason for acting in accordance to his instincts, he will accept it even on the slightest evidence. The origin of myths is explained in this way. - Bertrand Russell |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 09/09/2007 : 08:28:32 [Permalink]
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Originally posted by JEROME DA GNOME
As you see the system is a slush fund for the government on the backs of the common worker. Why again do you think this is a good system? |
Jerome, it was crystal clear from Peny's posts that she thinks if the original system were left alone, it would have worked. Leaving it alone would obviously include not using it as a slush fund. How is it you are able to misunderstand so drastically? |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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JEROME DA GNOME
BANNED
2418 Posts |
Posted - 09/09/2007 : 08:59:03 [Permalink]
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Originally posted by Dave W.
Originally posted by JEROME DA GNOME
As you see the system is a slush fund for the government on the backs of the common worker. Why again do you think this is a good system? |
Jerome, it was crystal clear from Peny's posts that she thinks if the original system were left alone, it would have worked. Leaving it alone would obviously include not using it as a slush fund. How is it you are able to misunderstand so drastically?
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The point is she does recognize it as currently a slush fund.
Besides, when they instituted the program they still thought understood that it was a slush fund. The life expectancy was low enough that few would have ever been paid. It was a scam from the start and continues to be a scam.
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What a man believes upon grossly insufficient evidence is an index into his desires -- desires of which he himself is often unconscious. If a man is offered a fact which goes against his instincts, he will scrutinize it closely, and unless the evidence is overwhelming, he will refuse to believe it. If, on the other hand, he is offered something which affords a reason for acting in accordance to his instincts, he will accept it even on the slightest evidence. The origin of myths is explained in this way. - Bertrand Russell |
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JEROME DA GNOME
BANNED
2418 Posts |
Posted - 09/09/2007 : 09:14:56 [Permalink]
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American life expectancy in 1930
| Life Expectancy: Male, 58.1; Female, 61.6 |
Collecting SS at 62 when life expectancy was 58 was a scam from the beginning.
Keep in mind that currently you can only collect full benefits at the age of 67 years.
Another interesting tidbit. The initial tax was 2% up to $60 as the maximum one could pay per year.
If is was such a good deal, why were federal employees exempt until 1983?
Today it is the largest government program in the world at $500 Billion per year.
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What a man believes upon grossly insufficient evidence is an index into his desires -- desires of which he himself is often unconscious. If a man is offered a fact which goes against his instincts, he will scrutinize it closely, and unless the evidence is overwhelming, he will refuse to believe it. If, on the other hand, he is offered something which affords a reason for acting in accordance to his instincts, he will accept it even on the slightest evidence. The origin of myths is explained in this way. - Bertrand Russell |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 09/09/2007 : 10:05:20 [Permalink]
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Originally posted by JEROME DA GNOME
Collecting SS at 62 when life expectancy was 58 was a scam from the beginning. |
It wasn't intended to cover everyone, and less than half the citizenry had to pay into it.| Keep in mind that currently you can only collect full benefits at the age of 67 years. |
Irrelevant.| Another interesting tidbit. The initial tax was 2% up to $60 as the maximum one could pay per year. |
Indeed. So what?| If is was such a good deal, why were federal employees exempt until 1983? |
Because Federal employees already had retirement programs available.| Today it is the largest government program in the world at $500 Billion per year. |
Depending on whom you ask, the defense budget may be $23 billion larger. |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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Penyprity and Thoughts of Scholl Taxes
