A Green New Deal……..please……

We The People were advised, by “experts”, to stop eating red meat and eggs in 1961. This advice was issued because, “settled science” deemed cholesterol to be the root cause of heart disease and heart attacks.  The government continued this guidance from “experts”, “for the greater good”, of course.

Just recently, however, that advice was retracted.  The “experts” discovered that the “settled science” was not so “settled” after all.

But what happened in the fifty ensuing years after the 1961 announcement? Many small businesses raising beef or eggs were hurt, or forced out of business. Families changed their lifestyle for no reason.  People complied with “settled science” and died from a heart attack anyway.

Now we are to believe that “experts” have “settled science” about the climate.

I am NOT a “denier”.

The climate has ALWAYS changed.

And anyone who believes that humans do not have an impact is also delusional.

However, I must ask why climate change “experts” are better than “experts” about diet?

How are “experts” “certain” about something as complex as climate change when diet’s affect on heart disease (complex, but not nearly as complex as global climate) is not “settled”?

Finally, I’d feel much better about the “advocates” and “experts” if they attended international climate conferences “virtually” instead of flying there.  When Al Gore sells the jet and “travels” via Skype, and AOC lobbies for a rules change so that she can participate in House activities virtually from New York City, I’ll feel better.

I have a very difficult time with people who don’t walk the talk.

But elites and elite wannabes are eager to set rules that The People must live under, while they are exempt.

#TheFoundersWeep
#NotSoSettledScience
#EatMeatAndEggs

Social Security Hurts The Poor, Reprise

Social Security is a bad deal for the American People.  We could, instead, be a nation of Millionaires.  The example used so far focused on a fictitious individual who worked their entire life at minimum wage.

Yes! ONLY minimum wage.

In this post, we are going to change the example to someone who works at the twentieth percentile of wages.  That is, our fictitious worker’s wages are greater than nineteen percent of the population, but LESS than eighty percent of the population.

Click here for the spreadsheet detail and calculations.

In this case, the Social Security benefit is $1,261.27 each month.
The Privatized monthly benefit is $1,650.58, or $389.31 MORE each month.

The Privatized solution provides these benefits from age sixty-six to age ninety-one.

The total retirement fund accumulated by our fictitious worker is $495,174.42.  In addition, the worker will have $106,893.68 with which to purchase a catastrophic healthcare plan in retirement.

Now, let’s assume, as we did for the minimum wage worker, that they marry someone who also works their entire career at the twentieth  percentile of wages.  The combined household retirement fund would be $990,348.84!!  The household funds with which to buy a catastrophic health insurance plan would be $213,787.36!!

Soon we will publish the same information for someone working at the median wage for their entire career.

I am still waiting for someone to tell me how Social Security is NOT Regressive?

And The Founders Weep.

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An Alternative to Single Payer Healthcare

Recently, I was asked for my alternative to a single payer healthcare system.

It was not that long ago when:

    1. A Doctor employed a receptionist, a nurse, and himself.
    2. Big practices may have had one other person in the office.
    3. Visits to the doctor were not hurried.
    4. Doctors also made house calls.
    5. A very intimate, personal, relationship was formed between patient and doctor.
    6. Pricing was FULLY known by patients.
    7. If the patient or their family didn’t have sufficient resources, a mutually acceptable arrangement was made to pay over time.
    8. That arrangement was normally NOT formalized legally.
    9. When you saw a new doctor, it was not necessary to spend a half hour filling out forms about privacy and payment terms and insurance information.

That is what I would attempt to bring back. And it is important to note that it IS coming back on its’ own in what is now called Concierge Medicine.

But, instead, the sixties came.

Everything changed in the sixties.

To be sure, there were difficulties before “the change” in the sixties.  Catastrophic illness could dig a big financial hole for a family.  Sometimes needed treatments could not be had.  It is certain that some died needlessly.

And so, the government galloped in on its’ noble steed to “fix” all ills.  And  the most tragic event in my lifetime occurred.

The “Great Society” Programs were signed into law.

We were told that all ills would be solved.  Poverty would be no more.  The elderly would not have to be concerned with healthcare and EVERYONE would prosper.  The poor would have healthcare, too.

As usual, the “cost” was  to be “minimal”.  To care for the elderly, a small 0.35% withholding was required from paychecks in the first year, matched by the employer.

And now?

    1. No one knows pricing.
    2. Instead we have ICD-9 codes, ICD-10 codes, HCPCS Level II codes.
    3. Office staff now outnumbers medical staff.
    4. Practices are now consolidated among several Doctors in the hope of holding down the exploding overhead costs.
    5. Employee withholding quadrupled to 1.45%.
    6. The employer contributes 2.9%, eight times the original rate.
    7. Yet, even with 4.35% of gross wages, an unfunded mandate measured in tens of TRILLIONS threatens our country’s financial future.
    8. And do NOT forget the arbitrary cuts to reimbursement rates to providers!
    9. Many Doctors have begun to refuse Medicare and Medicaid patients because of those draconian cuts and the egregious bureaucratic demands.
    10. Catastrophic illnesses STILL dig big financial holes for families.
    11. It is certain that there are STILL needless deaths.
    12. We still have poverty!
    13. TRILLIONS spent!
    14. Growing wealth inequality! (VERY ironic, given the goal of “The Great Society” aims!)
    15. TRILLIONS in the hole!
    16. Some of the elderly are still not served.

And so, of course, we need MORE government “help”!?!?!???!?

I think not.

Can I opt out?  Where do I opt out?

And we haven’t even TOUCHED the very real need for Tort Reform!!!
NOR have we discussed allowing insurance to be sold across state lines!!!

And The Founders Weep.

#TheFoundersWeep
#LessGovtHelp

 

How To Privatize Social Security-Part One

Previous posts have outlined how Social Security hurts the poor.  We’ve also shown how, instead, we could be a nation of millionaires.

But what might a privatized account look like?  How would it work?

Here are the  key parts of a Privatized program to which examples in previous posts conform.

    1. Payroll withholding is STILL mandatory, no exceptions, just like the current system.
    2. Withheld funds are STILL inaccessible until retirement, just like the current system.
    3. Withholding rates from the current system are retained in the new system at 6.2% for retirement and 1.45% for medical insurance during retirement.
    4. Employee withholdings are FULLY invested in the S&P 500 Index.
    5. The Employer matching portion is FULLY invested in the NASDAQ Composite Index.
    6. The funds are held in a brokerage account in the retiree’s name.
      1. Congress can’t touch it or spend it.
      2. The employee owns the account in full. In the current system, the employee has NO right to any of the funds withheld from their paycheck.
      3. Therefore, the account is inheritable by the employee’s designee.
    7. To be very clear, the employee has NO direct control of the way the withheld funds are managed or invested, just like the current system.  This means NO stock picking or trading. (No Enrons)
    8. Because the system is so simple and the dollar amounts and number of accounts are so vast, fees would be quite minimal.
    9. Distributions from the retirement fund will use the “4%” rule; meaning that no more than 4% of the retirement fund balance may be withdrawn in any year of retirement.
      1. Importantly, this means that the retirement fund will last twenty-five years, until the retiree reaches ninety-one years old.
      2. And the previous point assumes that the retirement fund earns zero after retirement.
      3. To those who are risk averse, the retirement fund can be changed in whole or in part to fixed income instruments.  Even that will extend the time horizon beyond the age of ninety-one years for the retiree.
    10. The accumulated amount generated by the 2.9% currently earmarked for Medicare MUST be used to purchase a catastrophic healthcare plan when retirement begins.

Leave your thoughts and comments below, please.

#PrivatizeSocialSecurity
#ANationOfMillionaires
#ItsJustMath
#TheFoundersWeep

“Socialist” Security Or Privatization???

Social Security hurts the poor.  We can, instead, have a nation of millionaires. The first case study focused on a fictitious individual who worked his entire life at minimum wage.

Yes, the individual received a wage increase ONLY when Congress mandated  a minimum wage increase.  That individual would have accumulated $374,608 in retirement funds, and $79,860 with which to purchase a catastrophic health care plan in the private market. (well….if the private market isn’t destroyed by politicians….)

Combined, that is $454, 468.  If our fictitious individual married someone who also worked their entire career for minimum wage, their household would have $908,936 in wealth on their day of retirement.

I’d call that nearly a million dollars!!!

The retirement portion $374,608 provides $1,248.69 per month until the individual is ninety-one years-old.  Or $2,497.38 per month for the household.  That compares with the Social Security benefit of $1,056. 50 for each individual, $2,113.00 for the household.

Between retirement age and age 86, the private solution earns the household $92,251.20 MORE than the Social Security “benefit”.  Being as the privatized monthly amount covers the retiree until age 91, an inheritance would be available to their heirs, if they pass away when Social Security believes they will.

And please do not forget that the household also has a combined $149,720 on the day of their retirement with which they can purchase a catastrophic healthcare plan.

Not bad for a couple who never earned more than minimum wage!!

Is this perfect?

No.

Are

    • ownership,
    • inheritability,
    • a higher monthly retirement check that lasts until your 91,
    • a smaller government bureaucracy,
    • a pool of capital that will grow by a trillion dollars a year for a generation,
    • low interest rates because we are awash in capital,
    • and a nation of MILLIONAIRES

worth a try?

I think so.

And The Founders Weep.

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#SocialSecurityHurtsThePoor
#ItsJustMath
#TheyCantGiveItToYouUnlessTheyFirstTakeItFromYou
#TheFoundersWeep

Social “Security”, In The Words Of A SUPPORTING Organization…..PART 2!!

The previous post demonstrated these three points about America’s first Socialist program, Social Security:

1.  That Social Security benefits DEcrease as retirement eligibility age increases.
2. That the retiree receives barely a third of what they earned while working.
3. The benefits will DEcrease as the Unfunded Mandate of Medicare continues to skyrocket.

For this post, we will focus on the following quote from this site: https://t.co/Y16JzxSkQz

“The [Social Security] trustees estimate that, if policymakers took no further action, Social Security’s combined Old-Age and Survivors Insurance (OASI) and Disability Insurance trust funds will be exhausted in 2034. After 2034, even if policymakers took no further action, Social Security could still pay three-fourths of scheduled benefits, relying on Social Security taxes as they are collected. Alarmists who claim that Social Security won’t be around when today’s young workers retire either misunderstand or misrepresent the projections. The long-term gap between Social Security’s projected income and promised benefits is estimated at 1 percent of gross domestic product (GDP) over the next 75 years (and 1.5 percent of GDP in the 75th year).

“Policymakers should address Social Security’s long-term shortfall primarily by increasing Social Security’s tax revenues. Social Security will necessarily require an increasing share of our nation’s resources in the coming decades as the population ages, and polls show a widespread willingness to support it through higher tax contributions. Recent trends also justify boosting Social Security’s payroll tax revenue: Social Security’s tax base has eroded since the last time policymakers addressed solvency in 1983, largely due to increased inequality and the rising cost of non-taxed fringe benefits, such as health insurance.”

YAY!!! Social Security is “only 1% of GDP for the next 75 years. GREAT NEWS, right???  Maybe not.  United States GDP is $20.66 Trillion.  There are 118,825,921 households in the United States.

It seems that each household would need to “only” contribute an additional $1,738.67 for each household in the United States, every year, for seventy-five years.

Do you have your checkbook out yet?

So, decreased benefits, or increased taxes, or both. AND, it hurts the poor the most.

Or…..do we modify the Social Security system to privatize the withdrawals, invest them in broad based stock indices, and create a Nation of Millionaires?

#ItsJustMath
#SocialSecurityHurtsThePoor
#TheyCantGiveItToYouUnlessTheyFirstTakeItFromYou
#TheFoundersWeep

Social “Security”, In The Words Of A SUPPORTING Organization…..

A gentleman said some unflattering things about me on Twitter because of my position on Social Security.  I responded stating that I provided facts and data and challenged him to do the same.

His entire response was this URL: https://t.co/Y16JzxSkQz

There is far too much to address on Twitter, hence this post and several future posts.

Briefly, much of what is presented by The Center On Budget and Policy Priorities supports my positions.  Following is ONE quote from the URL, titled (no joke) “Social Security Benefits Are Modest”.  (EMPHASIS  in quote below are added)

“For someone who worked all of his or her adult life at average earnings and retires at age 65 in 2018, Social Security benefits replace about 39 percent of past earnings. This “replacement rate” will slip to about 36 percent for a medium earner retiring at 65 in the future, chiefly because the full retirement age, which has already risen to 66, will climb to 67 over the 2017-2022 period.

“The average Social Security retirement benefit in June 2018 was $1,413 a month, or about $17,000 a year.

Moreover, most retirees enroll in Medicare’s Supplementary Medical Insurance (also known as Medicare Part B) and have Part B premiums deducted from their Social Security checks. As health care costs continue to outpace general inflation, those premiums will take a bigger bite out of their checks.”

So….they admit

1.  That benefits DEcrease as retirement age increases.
2. That the retiree receives barely a third of what they earned while working.
3. The benefits will DEcrease as the Unfunded Mandate of Medicare continues to skyrocket.

The existing system is a slow motion train wreck.  It represents a massive unfunded mandate.  The “Promise” must be broken, because #ItsJustMath My modest proposal gives the retired worker OWNERSHIP of a benefit that pays more, for a longer period of time.

#ItsJustMath
#SocialSecurityHurtsThePoor
#TheyCantGiveItToYouUnlessTheyFirstTakeItFromYou
#TheFoundersWeep

Promises Broken

Social Security hurts the poor in many ways.

Possibly the most tragic fact about Social Security (the first Socialist program instituted in the United States) is that benefits will be cut in the near future.

The following quote is from this document created by the Social Security Administration:  Social Security Administration Agency Financial Report 2018

“Social Security’s financing is not projected to be sustainable over the long term with the tax rates and benefit levels scheduled in current law.  Program costs will exceed noninterest income in all years of the 75-year projection period.  In 2034, the combined OASI and DI Trust Fund asset reserves will be depleted according to the projections  by Social Security’s Trustees.  Tax revenues are projected to be sufficient to support expenditures at a level of 79 percent of scheduled benefits after….Trust Fund depletion in 2034….”

So, someone retiring today at 66 years old will have a 21% reduction in benefits when they turn 82.  If they live to the expected age of 86, their last four years will be hit very hard as their Social Security check will be cut 21%.

It is VERY important to note that the Privatized solution to Social Security not only pays MORE, but the HIGHER monthly payment lasts until the age of ninety-one!!!  IT’S JUST MATH!!!

Social Security (…that is SOCIALISM….) HURTS THE POOR.

The Founders Weep

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How Is Social Security NOT Regressive?

As we’ve seen, Social Security hurts the poor and, instead, should have made us a Nation of Millionaires.

But WAIT!!  There’s MORE.

A general impression among The People is that the money withheld FROM THEM is held FOR THEM in a Trust Fund.

They are wrong.

The Trust Fund exists. But NO ONE has ANY claim to ANY of the money withheld from their paychecks.  Those funds can be (and are) redistributed in any way the government may choose.

One simple, unalterable, undeniable, fact illustrates this quite clearly.

Assume that our minimum wage couple  planned a trip celebrating their retirement.   Their children are grown and are no longer dependents.  The couple has not received their first Social Security checks.

Tragically, the couple die in a solo car accident on the first day of their retirement trip.

Who receives the $506,000 that the couple would have received from Social Security if they lived to eighty-six?  Indeed, who receives the more than $130,000 that was withheld from this couple? Surely their children will AT LEAST get back what was withheld from their parents?

No.

The federal government keeps ALL of the money.  There is absolutely NO benefit to the couple’s grown children or other chosen heirs. The money confiscated from them is gone, completely and irretrievably gone.

How does this socialist program benefit the poor?

        • The payroll withholding is MASSIVELY REGRESSIVE.
        • The poor have NO ownership of the funds withheld from them “For Their Benefit”.
        • The rate of return provided by the Socialist program is far below that provided by a privatized (real) solution.
        • The privatized solution pays 18% MORE than the socialist “solution”.

And The Founders Weep

#TheFoundersWeep
#SocialismHurtsThePoor
#SocialSecurityHurtsThePoor
#PayrollTaxesAreRegressive

“Corporate” Taxes: A Study

ALL “Corporate Taxes” are paid by consumers at the cash register.

Any “Tax On Corporations” is REALLY a HIDDEN TAX on the consumer.  These HIDDEN TAXES are VERY REGRESSIVE, meaning that the poor are hurt by these taxes.

A recent exchange on Twitter demonstrated that few understand this simple fact.  The person commenting on my Twitter post said, “You’re literally just making things up. How is a corporate tax regressive?”

I thought it may be helpful to illustrate. Following is a spreadsheet for the fictitious “Denim Jeans Company”.   In this example, the company sold exactly 100 pairs of jeans.  One pair of jeans to a billionaire (the one percent), the other 99 were sold to individuals making minimum wage who will wear the jeans to work. (the ninety-nine percent)

The price for the jeans is $70.00.   In California, a 9.5% sales tax is added.  So each purchaser pays $76.65 at the cash register.  The purchase price without Sales and HIDDEN TAXES calculates to $67.55.

Total taxes of $8.12 are included in the price everyone pays.

It is critical to understand that the ninety-nine percent (THE POOR!!) paid $145.53  (99%) of the “Corporate Tax”!!!  The one-percent (THE RICH!!) paid $1.47 (1%) of the “Corporate Tax”!! Similarly, THE POOR pay 99% of the Sales Tax!!  How is that helpful to the poor?

This is, of course, simplified.  But that does not diminish the truth of the point.  This concept applies to ALL of the poor’s purchases.  Gas, Utilities, food, vehicle repairs, and any other goods and services.  “Corporate Taxes” are paid by consumers and are HIGHLY REGRESSIVE.

These simple mathematical facts prove that the “Corporate Tax” is REGRESSIVE!!

This is NOT “ideology”!!  This is NOT “spin”!!

#ItsJustMath

#TheFoundersWeep

The Myth of Corporate Taxes

A brief pause on exposing the ripoff that is Social Security.

I am weary of hearing constant demands to tax corporations.  Corporations, it is believed, are hoarding money that The Establishment believes they (and they alone) can put to better use.  Many preach that the unmitigated greed of corporations is an affront to all fair minded people and a chief cause of poverty.

However, the simple fact is any corporate tax is paid with funds collected from consumers when they purchase goods and services. 

To illustrate, General Motors’ 2017 Annual Report shows Income Tax Expense of $11,533,000,000 and 9,600,000 total vehicles sold.  Quite simply, the price of the average vehicle sold by General Motors in 2017 included $1,201.35 that was collected from the consumer and then handed to government as “corporate” tax.

This simple fact, that funds collected from YOU AND ME are used to pay “corporate” taxes, is true for all corporations including manufacturers, wholesalers, steel plants, theaters, grocery stores, doctor’s offices, drug stores, and gas stations.  It is ALWAYS paid by the consumer.

These hidden taxes are highly regressive, pushing up the cost of living on the poor.  Curiously, The Liberal Establishment who advocate for higher corporate taxation hold themselves out to be champions of the poor when the poor are the most egregiously injured by this hidden tax.  Shouldn’t the left be advocates for NO corporate taxes because of their inherently regressive nature?

Also, The “Conservative” Establishment says that lower corporate taxes will mean more money to pay employees or to distribute to stockholders.  That is not surprising as The Establishment is always focused on who gets the money, and not who pays it.

#TheyCantGiveItToYouUnlessTheyFirstTakeItFromYou #YOUpayCorporateTaxes   #RepealTheSixteenthAmendment #TheFoundersWeep

So…..Where Did All That Money Go???

The previous post demonstrated that a husband and wife who never earned more than minimum wage could have amassed nearly one MILLION dollars in wealth if the Socialist “solution” (Social Security) had been replaced by a Privatized system.

Well, if they don’t have the money, where is it?

In their case, much of it was given to wealthier people.  And in some cases FAR wealthier people.   Multi-billionaires like Warren Buffet receive Social Security checks.  The funds paying for Mr Buffet’s benefits is obtained from the pool of money confiscated from working people, like our minimum wage couple.

You see, Social Security is an “Entitlement”.

Sounds comforting, doesn’t it? YOU are “Entitled“!!!

But “Entitlement” means that EVERYONE receives the “benefit”.  There is NO Means Test.  Warren Buffet, by law, receives “his Entitlement”.  To his credit, Mr Buffet donates any amounts he receives from Social Security to charity.  But that does not answer the question, “Why is a multi-billionaire receiving ANY kind of government benefit check?”

In return for surrendering any and all claims to 14% of their gross earnings, our minimum wage couple will receive payments from the federal government until they die…….provided they meet the criteria of the federal government.

They can NOT choose when to retire.  The government decides that.

They have NO input into their monthly benefit.  Everything about calculating their “benefit” is dictated by the government.

They can NOT even work to augment their “monthly benefit” without government rules and restrictions applying, including the possibility of taxing their “benefits”!!

I’m waiting for anyone to explain to me how this is a good deal for the minimum wage couple.

A Nation Of Millionaires

It is tragic that so many of We The People believe that “government solutions” exist.  Calls for Socialist “solutions” is gathering momentum.  Nothing could be more disastrous for you as an individual, or for our country.

A central goal of this blog is to  fully expose and demonstrate the fallacy of that cornerstone of progressive “solutions”, Social Security.

Establishment “solutions” to “fix” the myriad problems surrounding Social Security are always “more of the same”: less personal Sovereignty, more government intrusion, higher taxes, or lower benefits.

The TRUE solution, always ignored by The Establishment, creates a nation of Millionaires.

The attached spreadsheet assumes that an individual starts working at eighteen years old, and works their ENTIRE CAREER at MINIMUM WAGE. 

The spreadsheet then calculates the Social Security benefit as prescribed by law.   Under current law, that “benefit” is calculated to be $1,056.50.

The spreadsheet also calculates the monthly income if the employer and employee withholdings are, instead, invested in the S&P 500 and NASDAQ Composite indices.  That monthly income is calculated to be $1,248.69, and would be available until the taxpayer lived to ninety-one-years-old, well beyond the current life expectancy.

So, the Socialist “solution” is $192.20 per month LESS than the Privatized solution.

The total accumulated by investing as described is $454,468.73.

It is important to understand that this accumulation was amassed during a  time that includes the DOT COM bubble burst, the great recession of ten years ago, 1970’s “stagflation”, and other crashes and detrimental events.

The two indices include thousands of stocks.  So, the investments are VERY diversified. (SAFE!!!)

If the individual marries someone who lived the same career path, their household would have total assets of $908,937.46.  I’d call that damn close to a million dollar household…..but that isn’t true with the Socialist “solution”.

Click HERE to see the calculations supporting this post. Link will open in a new tab.

#ItsJustMath #TheyCan’tGiveItToYouUnlessTheyFirstTakeItFromYou #SocialismHasNeverWorked

Social Security Hurts The Poor

Avowed Socialists were elected to several state and federal offices in the latest election.  Such candidates, and now office holders, relentlessly attack capitalism as a failed system and extol the socialist “solution”.

The more you understand the previous paragraph, the more you should be concerned.

Quite simply, the socialists are mistaken.  Let’s examine the first socialist program implemented in the United States: Social Security.

The simple, objective, fact is that Social Security is a bad deal for workers; especially the poor and middle classes.

Here are simple FACTS about Social Security:

    • Social Security taxes are SEVERELY REGRESSIVE.   It’s levied on the first dollar earned.  There are no deductions or credits.
    • Social Security confiscates more than 11% of the working poor’s compensation. (Medicare withholdings drive that up to more than 14%.)  For the working poor, 11% of gross compensation can be several MONTHS rent, OR it can be a VERY significant portion of their food budget.
    • There is no right of inheritance.  To illustrate, if you and your spouse die the day before you retire, and your children are independent adults, the federal government KEEPS ALL of the money withheld from you and your spouse during your careers.  That is HUNDREDS OF THOUSANDS OF DOLLARS, even if you only earned minimum wage throughout your career!!!
    • The government calculated “benefit” is FAR less than that provided by a Privatized solution.
    • Social Security represents an unfunded mandate of tens of Trillions of dollars.
    • In fourteen years, a 23% CUT in benefits will be implemented unless payroll taxes are increased. (Workers lose either way.)
    • We can, instead, be a nation of MILLIONAIRES.

Stay connected to see how.  (and it ISN’T Socialism…….)