Las Vegas Sun

April 28, 2015

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Letter to the editor:

Social Security is unlike insurance

Another view?

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Regarding the Oct. 26 letter from Janice Herr: She stated that Social Security is an insurance program and not a Ponzi scheme because it is named Federal Insurance Contributions Act with no guarantee of a payback. I do not agree, so let us compare.

Purchasing insurance is a voluntary decision made by the person seeking coverage from which, as Herr says, “you may not get a dime back.”

Contributions to Social Security are mandatory with the expectation of payback upon retirement. And, typical of Ponzi schemes, more recent contributions are used to pay earlier contributors with no guarantee as to the safety of principal.

While Social Security is not, in the strictest sense, a Ponzi scheme, it is more Ponzi-like than insurance. Let’s hope that proper management will allow future participants to realize some security in the return it promises.

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  1. Amen. Letter writer is dead on center correct. Social Security needs reform. Else it will be insolvent and bankrupt. If not, the ponzi scheme will prevail and pervade.


  2. I received a screwy letter from an incoherent leftist that rambled on and on filled with misspellings, incomplete sentences and just plain nonsense because I wrote that my costs for a Medicare supplement will rise 10-fold beginning in 2013. The guy (or gal) is getting a lot of "free" stuff from the feds and is terrified he/she will lose it if Socialists such as Osama Obama are kicked to the curb and he/she is probably right. The rate of spending by the creepolas in Washington, D.C. is unsustainable and, sooner or later, the incoherent one is going to have to pay the price. But, being economically ignorant, the writer lives in a bubble that is going to burst and then will have to take on the burden of caring for him/herself. What a concept! Taking responsibility for oneself. I guess that never occurred to the incoherent one.

  3. The average SS check is a grand. Even with SS millions of seniors live in poverty. We need a strong national pension system. There is no wealth creation taking place among the young because of lousy wages and high aggregate costs. These folks need more than a grand a month when they retire in 40 years.

    Supplements are going up by 10 fold????They are not going up by 10 dollars. Jerry is spending too much time on Fox news.

  4. "It doesn't contribute to he national debt."

    The earnings on the IOU's to the SS fund adds to the national debt and the deficit.


  5. There was a form of whole life insurance that provided an annuity payable at retirement and included death benefits. It's just hype, though. The politicians want those who pay in to pay MORE IN--you will get to pay more income taxes to fund war and welfare. And, you'll get to pay more to get reduced SS / Medicare benefits -- so the "extra" you pay in can cover the additional MEDICAID recipients who refuse to pay anything, even payroll taxes.

  6. Gerry 9:37: Insurance premiums will go up, perhaps not 10 fold, but they will increase to cover all the "mandatory" obamacare costs like keeping the kids on til age 26. SS started out providing for our great-grandparents--who didn't live all that well on the old age pensions they got--but we don't have first-hand evidence of what life was like for old-timers without SS--the stories are that during the Depression, many hurt real bad. Anyhow, our parents parents got "taken care of." Our parents are now getting their SS checks and doing OK, not wonderfully, but more than OK. We are starting to see the austerity in that our benies of $1K a month are likely to lose purchasing power as soon as the Federal Reserve drops the QE nonsense and allows interest rates to return--and we'll see the economically-required devaluation of our currency. So we will see the austerity any year now--probably starting quickly with Obama's next "budget" and tax "plan." A national pension might be a good idea but what you gonna do with the fools who refuse to contribute above the minimum? When they "retire" from part-time work, they will qualify for every welfare program on the books, so you and I will get to keep supporting them and theirs UNLESS we have the backbone to LIMIT WELFARE to 2 / 5 years. Perhaps we can do a work-program of building "housing projects" that are senior dorms with communal kitchens--rather than "medicaid" fund their nursing home care.

  7. Roselenda:

    Social Security stared in 1935 as a "retirement program". If you were 30 years old, I'd buy your comment about "great grandparents" getting Social Security. But judging by your posts, you're not 30 so your point is off.

  8. <<When they "retire" from part-time work, they will qualify for every welfare program on the books, so you and I will get to keep supporting them and theirs UNLESS we have the backbone to LIMIT WELFARE to 2 / 5 years. Perhaps we can do a work-program of building "housing projects" that are senior dorms with communal kitchens--rather than "medicaid" fund their nursing home care>>


    Again, you are misinformed about things. Yes, Medicaid does pay for nursing home care more times than not, especially after one's money runs out and that can be very quickly. Average cost for nursing homes is $3000 a month. And nursing homes have medical staff because the facilities are for those with moderate to serious medical problems that prevent them from living independently or even in Assisted Living facilities (which are ALWAYS private pay and can cost at least $5000 a month).

    Nursing homes (and assisted living facilities) are totally different then "independent housing" for seniors. There are two types of independent housing for seniors: there is housing where you have to be over 55, in some cases 62, and your rent is market rate and you are responsible for any utilities not included in the rent. The second type is "subsidized housing" where the rent is pro-rated on your monthly income. Usually, some utilities are included in the rent such as water, electricity or gas. There is a special formula that is used to come up with the subsidized rent number. And a LOT of times, the subsidies come from the State where the housing is located, with some help from the federal government, HUD. Without this type of housing for seniors, seniors would be living on the street.

    I don't know who you are referring to when you say "When they "retire" from part-time work..." - are you talking about seniors?

    I can't wait until you hit your 60's. Are you in for a rude awakening!!

  9. Det_Munch @ 4:58am...

    "Again, you are misinformed about things."
    ('Entitled to own opinion; not own set of facts')

    Good post, munchie!

    @ zippert1...

    "Jerry is spending too much time on Fox news."

    Him & Bocephus!
    I'm hearin' a duet...a mashup; like capturing rage in a bottle!

    @ Carmine...

    "The earnings on the IOU's to the SS fund adds to the national debt and the deficit.

    Well, true DAT, Mr. Happy...
    but that's beside the point, isn't it?

    Vidi V...
    Always a pleasure; Welcome back.

  10. Here's the facts, doubters: In addition to the money taken from my Social Security benefit, I currently pay $31 a month extra for vision & prescription coverage. The company (which shall go unnamed) dropped my Medicare Advantage plan and, for a plan that contains lesser benefits (no vision coverage except for cataracts & glaucoma), now asks for close to $310 per month (in addition to what is taken from my SS). I realize many of you graduated from pulic school and thus are inacapable of multiplying 10 X 31, so I'll do the math for you - it's 310. That's a fact. Don't believe me? Ask any math teacher how much 10 x 31 is. He/she will back me up, that is unless he/she is doing what so many public school teachers do - indoctrinate rather than educate!