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Do you see justification for making interest payments to the truly rich on the government bonds they own?
Sure, they paid for the bonds.
Do you see where I am going with this?
I do. They bought bonds because they are an investment offering a return. They paid SS as it is required to participate in the program that is basically insurance against running out of money in retirement. They are in no danger of running out of money. Do you see where I am going with this?
Do you see justification for making interest payments to the truly rich on the government bonds they own?
Sure, they paid for the bonds.
Oh, they may get their interest - just not all their principal - if Trump's latest brainstorm (I had a better word in mind, but decided not to devolve to his level) comes to pass.
In other words, the US would reorganize its debt similar to Chapter 11 or 13 - pay back less than 100c on the dollar.
I am clearly very naive - because as outrageous and unthinkable as this 'possible' solution for US debt/interest burden sounds - there was not a very big hoot or holler on CNBC or other stations. For the most part, people were laughing - but I'm not so sure. Given where Trump is today, there are clearly no absolutes in any area any longer.
Nothing is sacrosanct. Nothing - and that includes all "entitlements."
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In other words, the US would reorganize its debt similar to Chapter 11 or 13 - pay back less than 100c on the dollar.
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Now the US must churn to keep 20 trillion afloat... maybe soon 50 trillion... at what point are the buyers (except for the fed) hard to find? So you look to get it from those that already bought.
I do. They bought bonds because they are an investment offering a return. They paid SS as it is required to participate in the program that is basically insurance against running out of money in retirement. They are in no danger of running out of money. Do you see where I am going with this?
Yes. You want to rob Peter to pay Paul. Such proposals are not uncommon and can count on the support of Paul.
By the way, the Heritage plan (supported by Paul Ryan in some particulars) would do this, and we have to rationalize our government spending, but I think it is too harsh on thrifty middle-income savers who could very easily go from having more than enough to less than enough because they planned their savings around the Social Security promise.
I re-read your short post several times trying to understand it. Are you actually questioning that federal income taxation of SS benefits constitutes means testing? How could it be any clearer? If some people pay income tax on SS and other people do not, and the reason for the difference is other income (income in addition to SS), then that is means testing. In other words, if you receive SS benefits but then have to pay a part of them back, and the reason you have to pay part of them back is that your income exceeds a certain level, but people whose incomes do not exceed the threshold do not pay part of them back, then that is absolutely, clearly means testing. It isn't even arguable.
Unless I am failing to understand something, your reasoning does not make any sense at all. Please enlighten me.
I'll take a stab at it and I'll even use your own words to make my point. First of all, do you consider your pension to be means tested? How about your salary when you were still working as a teacher? If not, why not? There's absolutely no difference between taxing your salary and/or pension and the taxation of Social Security. It's income, plain and simple, and income is taxable at certain levels. Now, on to using your own words with a minor change....
Quote:
Originally Posted by Escort Rider
...In other words, if you receive (a salary and/or a pension) but then have to pay a part of them back, and the reason you have to pay part of them back is that your income exceeds a certain level, but people whose incomes do not exceed the threshold do not pay part of them back, then that is absolutely, clearly means testing. It isn't even arguable.
Even if I haven't changed your mind and you continue to believe that Social Security (apparently along with salaries and pensions) meet the definition of means testing, you at least have to concede that it certainly is arguable, because that is exactly what is transpiring in this thread, lol.
I'll take a stab at it and I'll even use your own words to make my point. First of all, do you consider your pension to be means tested? How about your salary when you were still working as a teacher? If not, why not? There's absolutely no difference between taxing your salary and/or pension and the taxation of Social Security. It's income, plain and simple, and income is taxable at certain levels. Now, on to using your own words with a minor change....
Even if I haven't changed your mind and you continue to believe that Social Security (apparently along with salaries and pensions) meet the definition of means testing, you at least have to concede that it certainly is arguable, because that is exactly what is transpiring in this thread, lol.
You act as if you've scored some debating point, but I don't see that you are saying anything different from what I said. Of course my salary was means tested and my pension is currently means tested. Income taxation, unless it is a flat rate where everyone who has income pays the same rate, is a form of means testing. The different tiers of Medicare Part B premiums are a form of means testing. The provisions for low income people to pay a lower rate on their electric bills are a form of means testing, as you and I don't get that lower rate. I don't consider it arguable from the point of view of logic, no matter how many people actually argue about it.
What can be legitimately argued is whether a given form and amount of means testing is good, bad, or indifferent. Means testing provides funding for various safety nets and in the case of Social Security provides a bigger return for low-income people (percentage wise). I think in general that is justifiable - a good thing.
The debate here in this thread, a legitimate one, is about whether further means testing of Social Security, in addition to that which already exists, is desirable. But as we debate that, at least we should be honest in our use of terminology and not pretend that Social Security is not already means tested.
Yes. You want to rob Peter to pay Paul. Such proposals are not uncommon and can count on the support of Paul.
By the way, the Heritage plan (supported by Paul Ryan in some particulars) would do this, and we have to rationalize our government spending, but I think it is too harsh on thrifty middle-income savers who could very easily go from having more than enough to less than enough because they planned their savings around the Social Security promise.
I would love for Peter to pay Paul a living wage so he didn't need so much assistance but after roughly 4 decades of looser regulations and lower taxes for Peter, I am ready to conclude that the experiment has failed. Peter seems to be driven by profit only. The crazy thing is that we have to pay for assistance well before retirement to help Paul get by and we are subsidizing Peter by doing this, so my sympathy is a bit limited.
I don't have the magic answer for the details. Proper grandfathering and consideration of career income could help with the middle-income savers. In the interest of full disclosure - I planned mine around it; I am an idealist but I live in the real world. One other problem seems to be that by the time most of us become aware of how much the system needs fixing we are so far down the path we want to make the change in a way that doesn't affect us. "Every generation. Blames the one before. And all of their frustrations. Come beating on your door."
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