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White House Announces Apple Pay Support for Federal Payment Cards
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Umm considering it is one more choice to access those funds. A lot of people collecting ss do not have a bank account of any type it gives an option to those people to access their funds and in a cheaper way honestly. Heck I would not be surprised if they already issue them to a check card. I know with ss you can say direct deposit the funds into your bank account if you have one.
Better that say Texas unemployment which only goes to a chase bank card and it is a pain to transfer to your own personal account.
Isn't the idea of superannuation that the money you pay in gets invested and grows, then you get to access it for retirement? That's how they tell us that Aussie superannuation and KiwiSaver works. Because otherwise SS will run out of money as western countries have an increasingly aging population. A huge chunk of the younger people aren't even working anyway, or if they are it's crappy part time jobs that aren't nearly as good as the jobs their parents and grandparents had. So how could such a system where the retired people's income is paid for by younger working people?
It's actually pretty well documented that this is a myth.
"Social Security doesn’t look like a pyramid. Quite the opposite, actually. Its current funding shortfall is a product of the baby boomers retiring and birth rates declining. That means more beneficiaries and fewer workers than there were when, say, the boomers were working and their parents were retiring. So Social Security has a funding gap equal to 0.7 percent of GDP over the next 75 years. We could wipe that gap out by lifting the payroll tax cap (right now, payroll taxes only apply to the first $107,000 of income) or by adjusting benefits downwards. Once it’s done, however, it’s done. Stable. Again, quite unlike a Ponzi scheme."
It could be seen as a Ponzi scheme if it continues to be underfunded to the point where it's allowed to collapse. Curiously though, the people most interested in underfunding this insurance plan (which is what it is) so that it does eventually collapse, are often the very people calling it a "Ponzi scheme."
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Of course, none of that takes into account the many times the federal government takes money from Social Security to pay for other things.
The mistake is the SS money should not go into general funds and should be completely separate off. Untouchable funds for general usage.
Issue is ss money is lumped under general revenue and spent as such.
State governments mandate that we get car insurance, but because people move from state to state and economies of scale, retirement systems are more efficient at the Federal level.
Typically, the Social Security Trust Fund is kept separate; however, Congress has at various points raided it.
What is more like a tax is that the portion of income subject to social security "tax" is capped at just a bit over $100k a year. That means anyone making significantly more than that is paying less as a proportion of their income than the middle class. Removing the SS-covered income cap would make it stable for as far out as economic projections go.
Yeah, right.
I know a few people on welfare, and they have small 17" tube TVs with VCRs attached for recording, and old ps2s.
The real issue is that at some point someone on Welfare is offered a credit card! They are accepted, then spend it up to the limit quickly, like someone who 'won' money. They spend like $10,000 very quickly then can't even pay the minimum, thus declare bankruptcy. They buy all their welfare friends phones, game systems, tvs, etc. for a few months to a year until they can't anymore.
There's no downside for those people - someone 'gave' you $10,000 - whoo hoo! It's Christmas! You could NEVER afford this stuff - get it while you can! That's the mentality. People are NOT spending their welfare checks on this stuff, they can't afford it on a welfare check. They DO spend credit cards like crazy if some stupid company gives them credit cards with high limits.
It's the credit card companies that want to take advantage of the welfare people that is the problem. They're losing, but don't understand. This is why they charge 19-24% interest, because of these people that in no way can pay.
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Social security is the biggest Ponzi Scheme in history. The whole system started by giving people money for free, tax-bled from others. Today's workers are paying for current retirees. Do you seriously think the money people are receiving is coming from funds they themselves "paid into the system"?
There are many problems with Social Security, mostly created by politicians against the advice of the Social Security trustees.
But, this is not one of them. Every dime "taken from Social Security" has been accounted for in the trust fund. The excess revenue collected by Social Security was loaned to the general fund, in the form of a long-term US Treasury Bond created for that purpose.
They are a bit different than a US Treasury Bond you might have bought for yourself, but the obligation is the same. They actually exist in paper form, in a file cabinet in West Virginia -- not really relevant, but I always thought it was fun piece of trivia.
If you are wondering why Social Security bought the equivalent of US Treasury Bonds instead of something with a better return: until recently, it was considered the safest long-term investment in the world. And, one can only imagine all the restrictions that Congress would have imposed on any investment in the private sector: it would have been a huge "political football".
I don't remember the exact year, but around 2013, Social Security expenditures for "old age and survivor benefits" started to exceed the revenue collected. It had been projected to begin in 2016, but the recession led to a wave of early retirements and reduction of wages.
At that point, trust fund redemptions began. The bonds are being cashed in, and paid out of general revenue. The net effect has been to convert them into regular US Treasury Bonds sold to private investors and public pension funds, as long as there is a net deficit in the general fund.
This will continue until the Trust Fund is exhausted. So, the federal government will pay back every dime that it borrowed, with interest. The problem is that the Trust Fund is expected to be exhausted around 2033. After that, Social Security revenue is projected to only meet about 75% of the current projected benefits. By law, Social Security benefits must be reduced to a level that meets the incoming revenue.
How it got this way is a longer discussion. But, it really comes down to this: all parties have have put their heads in the sand, for too long. The problems have been known for a long time, but no one wanted to make the hard choices. The opportunity has passed to solve the problems without a lot of pain, and every month that it is delayed will just make the pain worse.
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SSI is administrated by the Social Security Administration. But, the benefits are separately funded from general revenue, not FICA tax revenue.
I grouped these replies together, because they are somewhat related.
I'm going to burst a lot of bubbles, but Social Security is not a pure insurance plan, or even a public pension plan. The reason: the benefits you receive are not directly related to the amount of taxes that you pay.
Explaining why will require a bit of detail. Here's the calculation directly from the SSA:
http://www.ssa.gov/oact/cola/piaformula.html
For an individual who first becomes eligible for old-age insurance benefits or disability insurance benefits in 2015, or who dies in 2015 before becoming eligible for benefits, his/her PIA will be the sum of:
- 90 percent of the first $826 of his/her average indexed monthly earnings, plus
- 32 percent of his/her average indexed monthly earnings over $826 and through $4,980, plus
- 15 percent of his/her average indexed monthly earnings over $4,980.
If you go through all the calculations, someone earning less than the median income (over their lifetime) will collect more Social Security benefits than the value of their contributions. Someone earning more than the median income will collect less than the value of their contributions. That makes it a welfare program, at least partially.
And now the last poster above may be able to see the flaw in his suggestion: eliminating cap on wages taxed by Social Security cap would also increase their benefit. There would probably be some net gain, but it wouldn't be as much as most expect. And, it also overlooks another problem: high-income individuals get the majority of their income from sources not taxed by Social Security. And, they have many opportunities to change their compensation plans to shift income away from wages.
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Again no it is not. This has been proven wrong multiple times over. It is a lie that you are buying hook line and sinker fed by conservatives.
Money you put in to SS is supposed to be invested in a trust fund and grow. Later in life when you retire/need the money you pull from that growth.
Now SS does also handles cases like disability that hit people unexpectedly and earlier in life than one ever plans. It also pays for things like that as well to make sure you are not screwed because you got disabled. It to help slow down bleed on funds. How much you are going to get on disability depends on age and how much you put in. You pretty much get more credit for years worked and type of disability. It is there to help.
But hey you can keep trying to push the complete lie. You can even believe the lie but believing in the lie does not change the fact that it is a lie.
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how I would say plug SS fund problem. Take away the cap but do cap benefits at where they are at now (inflation adjusted) so if you are making what I believe is 108k your benefits are capped at that point but you are taxed all the way up to your max income.
Also throw in capitals gains as taxable for SS but also include those benefits pay out calculations same max cap. It basically readjust everything and plugs a lot of holes.
Except... it's not. The taxes you pay to Social Security are paid to current recipients. That's how it has always been. Whether it is a Ponzi scheme or not depends on your definition.
The trust fund contains the excess taxes collected in the past few decades -- when there was a net positive cash flow. It was up to about $2.5 trillion. But, as I noted in an earlier posting, the net positive cash flow has ended and the trust fund is now being redeemed. When its gone in about two decades (according to latest projections), there won't be enough taxes to fund current benefits.
I explained the problems with this proposal in another posting above. And, all it really does is accelerate the redistribution of income that is already occurring. It doesn't solve the basic problem: Social Security is actuarially unbalanced. Those are not my words: it's from the Social Security trustee's report. They've been writing them every year for at least a decade.
And every year for almost a decade they have shown easy long term fix. Issue is every year they delay the bigger the issue.
If they had been doing it right it would never of been a real issue. The trust funds builds up and by the time you start having a negative drain and pull from the trust fund it should be making more in interest than paying out. Really problem is they have been ignoring fixing it for decades so yet again never would be an issue.
That trust fund was suppose to be building up for a long time so by the time money stop going in that it would be fine but hey neither party really wanted to fix the issue.
And therein lies the problem that you aren't grasping.
Social Security has NEVER been "doing it right". That would have been like a fully-funded private pension plan, where worker's contributions are invested and the benefits are actuarially balanced: meaning that they only receive what they contributed (plus return on investment).
Social Security has never been as you describe, from day one. Many people "believe" it is run like that, but they are either misinformed, or willfully ignorant. The only ones that made that kind of promise were either wrong, or intentionally misleading.
Another poster asked if it is like an Australian plan in which they claim it is done that way, and points out that otherwise, it is doomed to run out of money due to Western demographic trends. He was exactly right, and that's the fate of Social Security if it isn't converted to something similar. Any "tweaks" that are made today will just kick the can down the road a bit farther, like the last time they "saved" Social Security in the 80's.
But, what do we do about current or near-term beneficiaries? Unfunded liabilities for Social Security are about 10 trillion dollars through 2087. They have paid Social Security taxes, and deserve at least some return on their "investment". There's nothing to fund it, and it wasn't "stolen". It went exactly where it was intended -- to their parents and grandparents, almost immediately.
Another commentator who does not know what a "Ponzi scheme" is. Sigh.
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There may be some misunderstanding of what an "unfunded liability" is. It simply means the future income is projected to be less than the future expenditure. It won't run out of money; it just won't have enough money to pay 100% of what is promised to certain individuals unless something (the benefits, the qualification, or the revenues) is modified. I don't know the exact figures, but without modification there might only be enough income for some future beneficiaries to get, for example, 70% of the current benefit. They won't get "nothing". Moreover, the system could be fixed pretty straightforwardly, by either raising the retirement age, reducing benefits, or supplementing with additional tax revenues. It's a political problem, not a financial one.
You do make a lot of good points though, otherwise
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Another tea party spin. Of course the Federal Government borrows from the SS trust fund. SS should be investing surplus funds, and this is done by buying Treasury Bonds. Everyone other than tea baggers understands that Treasury Bonds are a high quality investment vehicle, and returns interest to the SS trust. Buying Treasury Bonds is exactly the same as the Federal government borrowing from Social Security to pay for other things.
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It's been at least 500 years since people figured out that there are alternatives to hiding cash under your mattress. We now have this thing called "accounting" that makes cash fungible-- it actually is possible to keep track of who owes money to whom.
To be clear, this is NOT for welfare payments.
People, please drop the welfare idea from this discussion.
So big broither and uber big brother working together?
Somebody at apple should put that 1984 on a screensaver at all computers in apple. Just to remind them what the company once stood for .
You were really close: current projections are that revenues will only provide enough for about 77% (correcting my earlier posting) of legislated benefits, starting around 2033 when the trust fund is depleted. You can find that information here:
http://www.ssa.gov/OACT/TRSUM/index.html
But, I think you missed my point: I was trying to explain how difficult it would be to convert Social Security into the fully-funded plan the OP thought it "should" be, where each contributor has an actual "balance" in their name. It has been done by other countries, but I think we passed that opportunity long ago.
Back in the 80's, this was exactly what was attempted. They accelerated tax increases that had already been enacted in the 70's: from 1970 to 1990, the rate increased from 8.4% to 12.8% -- a nearly 50% increase. The "full" retirement age was also gradually increased by 2 years, from 65 to 67. That shortened average remaining life expectancy by about 2 years, thus reducing benefits about 10%.
The result? All it did was kick the can down the road a little farther. Would a new round of "tweaks" be any different?
The SSA has already prepared a series of reports on the effect of individual changes:
http://www.ssa.gov/OACT/solvency/provisions/index.html
Here's what is projected if the cap on taxed payroll is eliminated:
It just delays the inevitable by about 27 years. And here's the projection if taxes are increased from 12.4% to 15.5% in 2015:
It just kicks the can down the road a bit longer.
There are many proposals that were evaluated. You might find one you like there, but be sure that is actually solves the problem, rather than pushing the problem out for the next generation to deal with it.
This was an unnecessary use of a pejorative. I've found that as a group, conservatives in general, and Tea Party members in particular, are more likely to understand the composition of the trust fund. And, they also understand that it only delays the inevitable. Of course, there are exceptions, but it's usually people that are tired of being called "greedy geezers".
On the other hand, the left cranks up the demagoguery when anyone proposes the need to address problems in Social Security before it becomes a crisis. Social Security is known as the "third rail" in politics. That's why nothing has been done since it became obvious the "fix" back in the 80's wasn't sufficient.
while that is true. Look at every federal budget put out. SS is counted as part of the budget. They need to break it out and not put it as part of the budget that gets "approved" every year. Instead have say short falls put as part of the budget that needs to come out of general revenue. Followed by all SS money not counted as part of general revenue on things that get approved. Otherwise it leads to confusion and gives the Tea Idiots room to scream about all that money.
We've been hearing this argument for decades and the system still works. It will start to break one day but it might take many generations to do so. So many things can happen in that time so I think it's wiser to spend resources on improving the economy and job creation.
@ptb42
Put a 1 cent tax on all high frequency trades that goes exclusively into the Trust Fund. Problem solved. Millions of transactions a day, that serve absolutely no purpose to humanity other than to skim money off the market. If we aren't going to outlaw that kind of trading at least have it fund the last remaining shreds of the social safety net that this country has.
As for Apple Pay, good, this is way more secure than current systems.
Put a 1 cent tax on all high frequency trades that goes exclusively into the Trust Fund. Problem solved. Millions of transactions a day, that serve absolutely no purpose to humanity other than to skim money off the market. If we aren't going to outlaw that kind of trading at least have it fund the last remaining shreds of the social safety net that this country has.
As for Apple Pay, good, this is way more secure than current systems.
Where did I say that it was funded by FICA or OASDI? I was responding to a poster who said that SS was not a welfare program, which is generally true, however Title 16 of the Social Security Act is essentially a welfare program for disabled people. If you're saying that Social Security Supplemental Security Income isn't "social security" in the context of this discussion regarding government benefits and payment cards, I don't know what to say.
As far as your other points regarding means-testing and issues with removing the cap, I never said it was as simple as a one line change to the lawthat was your straw man. Any time you mess with benefits, you need to consider the consequences. Means-testing is one way of handling that.