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Journal pudge's Journal: Social Security Calculations 12

Journal by pudge

Our new old friend Harry Reid was on NewsHour last night, plugging his social security calculator on "democratic.gov." I guessed and then confirmed that no such site exists, and tried http://democrat.gov/ which I thought might be right until I noticed this is the *House* Democrats. So I tried http://democrats.gov/ (the 'S' stands for 'Senate'!) and saw Harry's happy shiny face.

I found the calculator and punched in some numbers. I was born in '73, and I picked a nice round number, $100,000. To my surprise (*cough*), Reid's calculator said with that income I would get less money from a private account than from social security.

But another calculator said I would get more. A lot more. Like, more than twice as much.

Who to believe? Well, it won't be Harry, that's for sure. Especially since the Heritage calculator gives me all the details and assumptions, and the Democrats aren't nearly as detailed in the assumptions listed in their linked PDF. And because it runs against common sense that if I put that much money in an account for 30-something years with compounded interest that I would get only $8,000 a year in return. But as I cannot evaluate their exact assumptions, I can't tell what the heck they are doing (I could try to read their JavaScript I suppose ... maybe for another day).

One thing I do think is hilarious is that in that linked PDF, they say there's a "privatization tax." A what? They take the concept that half my money goes into a private account instead of social security, and thus half my benefits come from same, and say that my social security benefits are getting "taxed" because I am not getting the full government-funded benefits I otherwise would. They call this a "tax:" not getting benefits I choose to not get, and don't pay into in the first place. This is doublespeak at its best. I almost admire it.

Another thing worthy of note is this little bit on the page: 'Since [Bush] has not made a specific proposal, these estimates assume that benefits are "price indexed," a proposal made in Plan 2 of President Bush's Social Security Commission.'

Huh. Bush has not made a specific proposal? Yes, that appears to be correct. This is one of the plans on the table from other people working for Bush, and Bush has not endorsed or pushed that one in particular.

Then why does Reid keep saying he has, such as in this quote from his response to Bush's state of the union?

There's a lot we can do to improve Americans' retirement security, but it's wrong to replace the guaranteed benefit that Americans have earned with a guaranteed benefit cut of up to 40 percent.

Make no mistake, that's exactly what President Bush is proposing.

At least I agree with the Democrats on something: that Reid was lying when he said to the nation that Bush was proposing guaranteed benefit cuts.

This discussion was created by pudge (3605) for no Foes, but now has been archived. No new comments can be posted.

Social Security Calculations More

Social Security Calculations

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  • Well it's just javascript, so the code for the calculator is right there in front of you. So, I'm sure you can figure out what the formula assumes and doesn't assume. But you're right, it's no surprise that no matter what data you enter it shows a cut. The one question I have is where does the data in that huge lookup table come from?
  • My big problem with privatization is that is ceases to be social insurance and becomes government mandated savings. Basically they're saying that I'm not responsible enough to invest money for retirement, so instead of lowering the tax, they take the difference and then give me some lame choices in the way to "invest" it.

    Why can't the government just own up to the fact that social security was never intended to be a retirement plan? Remove the limits completely, lower the tax rate down to 1 or 2%, and t

    • My big problem with privatization is that is ceases to be social insurance and becomes government mandated savings.

      Yep. It's like if we gave car insurance payments to everyone regardless of whether they got in an accident.
  • the code seems broken. Under IE & Firefox I cannot get the Heritage foundation to say anything other than "Sorry this is for people that haven't already retired."

    jason
    • Are you sure you're putting your age instead of the year you were born?
      • Duhhhhhhhh. Nope. I was using my birth year and not the age. Looks like someone doesn't know how to read instructions. Although that is an interesting behavior for an application. Seems like there is no upper bounds checking on the age so the calculations continue but some error is thrown and caught by some default catch statement.

        jason
  • My favorite part about how private accounts are going to fix Social Securities ills is the part where it doesn't fix crap.

    Good plan.
    • Security's....

      Damn... Slashdot needs an edit option. And I need to make judicious use of the Preview button.
    • My favorite part about how private accounts are going to fix Social Securities ills is the part where it doesn't fix crap.

      It does not fix the shortfall in social security, not directly. But it does make the shortfall cost less in the long run by bringing the costs up front instead of putting them off later, where they will cost more to pay off. And it also lowers the liabilities in the long run, which means that if we run into more problems down the road, it will be less of a problem to fix.

      But yes, pr

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