Laboring Longer a Growing Trend For Americans 603
AxSpark writes "More and more Americans have the tendency to work after retirement and this number is growing day by day. Last year this number was 6 million people of 65 and over working. The reason for that is quite evident: pensions are not enough for sufficient living."
Um, or... (Score:5, Insightful)
It could be that a lot of people are still healthy enough to continue working after age 65... and some people actually want to!
One more way it could be. (Score:3, Insightful)
Investments! (Score:4, Insightful)
Sure, blame the income (Score:5, Insightful)
The reason for that is quite evident: pensions are not enough for sufficient living.
Or: expenses are not enough under control for sufficient living. We all spend too much money on frivolous nonsense during spring and summer of life, but we don't have to.
(Not blaming anyone personally, I'm the first to realise I might have a big problem if all the drinking and smoking just doesn't kill me in time.)
Re:If only... (Score:5, Insightful)
If only people didn't look to government solutions and planned for own retirements.
"Quite evident"? (Score:5, Insightful)
Sure, some people are going to keep working because they need the money, but that's hardly proof of the fundamental reason for the trend. I think it's much more likely that it's related to the fact that people are living longer and healthier, and a lot of people (most?) don't want to just lie around the house.
In the "old days", 65 was one foot in the grave. These days, there are a lot more healthy 65 year olds that aren't content to believe that life is over and you might as well start waiting to die.
"pensions are not enough for sufficient living" (Score:2, Insightful)
Neither are hobbies.
Just sayin'.
Comment removed (Score:5, Insightful)
Not pensions, but health coverage (Score:1, Insightful)
Ask the oldies why they're working, they cannot afford the medical insurance on their own. My neighbor recently turned 80, his health insurance is $1200/month. Ask around, you'll find all the crusties doing crap jobs are doing it purely for medical coverage. Good job we're the richest country in the world, imagine how bad our system would be if weren't the most powerful nation on earth.
When I was a child (Score:4, Insightful)
Re:Um, or... (Score:3, Insightful)
Understand, it was the fact that there were no dependent young that made those boomers rich all their lives.
Society is indeed wealthier if that young man and that young women stay single and work overtime than they are if she gets pregnant, only works part time and creates a new dependent who will have to be cared for for 20 years.
Well, it's wealthier for almost 50 years, anyways... Then, it collapses because there are hardly any people around to participate in maintaining the critical infrastructure upon which everyone has grown to depend.
Rome is burning. Shut up and dance.
Re:Um, or... (Score:5, Insightful)
Think again.... Most people don't have the resources. I know people over 65 who work 2 jobs, 7 days a week, to pay medical bills, rent, and food.
A handful of people work because they want to. Most work because they have no choice. Do you think the greeters at Wal-Mart are there because they want to? Or because they have to eat?
Your statement is the sort of spin I'd expect from the neocons. Ultimately, people want to work because the alternative is starving, or not taking your meds, or living on the street....
As someone who is nearing that age, I'm trying to figure out how I'm going to retire without working. It's not easy, and our broken medical system is a huge part of it.
Re:So what? (Score:5, Insightful)
Yes, I too blame this problem on the "entitlement attitude."
It's not like people running out of retirement money has anything to do with people living much longer than in the past, or the skyrocketing cost of health care.
Expectations need to be LOWERED (Score:4, Insightful)
pensions are not enough for sufficient living."
Not everyone can have a house. Not everyone can have a car. Not everyone can live close to all the cool stuff in a city. That definition of "sufficient" is clearly debatable.
Certainly sufficient for survival is not what was meant. Sufficient for a comfortable existence relative to history? I don't think that is what is meant either. I think sufficient in this case means "as good or better than everyone else."
This insufferable materialism is killing us by inches. There's not a lot of inertia behind avoiding it either. I've never seen so many people fall so willingly into slavery.
Re:Investments! (Score:1, Insightful)
If more government is the answer, try a Cuban retirement.
Or maybe things are more complicated (Score:3, Insightful)
Re:If only... (Score:4, Insightful)
Re:Investments! (Score:3, Insightful)
Re:Investments! (Score:1, Insightful)
So let me get this straight ... people are too dumb to figure out how to save their money, so those of us who are smart -- let's call ourselves the Elites of Society -- can take their money from them, invest it for them and figure out how much they need and when they need it. Brilliant! I'm in.
Re:Um, or... (Score:5, Insightful)
How is health care related to old age pensions being insufficient ?
Fix health care, and all you do is make old people live longer, thus further burdening the pension system.
The fact is, in most western countries, the average age is increasing. The people on pensions now are being paid with the taxes you and I pay today. When 30 years down the road, we are pensioners, there simply won't be any money left to pay everyone a pension.
I was advised as far back as 1987 that I shouldn't rely on the UK state pension, and should think about a private one ... here we are 21 years later, and oops, pension payouts aren't sufficient ... anyone surprised ?
Re:One more way it could be. (Score:5, Insightful)
Re:Um, or... (Score:3, Insightful)
It could be that a lot of people are still healthy enough to continue working after age 65... and some people actually want to!
This reason gets my vote. Boredom is a sure way to the grave, as well. I know people who are retired from TWO different jobs, and they still enjoy working. Granted, it isn't full-time, but once you get used to living a certain way, hold habits die hard.
Re:Um, or... (Score:5, Insightful)
Why should we trust someone else to plan retirement for us? Yes, yes, I know, 40 years ago was a different time, but for those who didn't work a cushy job that came with a pension (my paternal grandparents were farmers, my maternal grandparents knew the pension would be insufficient), you realize you need to sock money away for retirement.
Myself, I plan on being financially independent by 55 (and have the plan to do it), although I have no intentions to stop working. At that point in time, work is no longer a necessity, you aren't doing it because you NEED it, but because you WANT it, and I can stop to take a trip with my wife whenever we feel the urge, or go visit the kids, etc. It's a good place to be in.
Re:Investments! (Score:2, Insightful)
Re:If only,if only... (Score:2, Insightful)
Hooray for big government! Who's with me!?
saving? (Score:3, Insightful)
It's the government, stupid (Score:3, Insightful)
"The reason for that is quite evident: pensions are not enough for sufficient living."
People are also working 40% or more of their lives to support the political class.
Re:Investments! (Score:5, Insightful)
Make it optional. I am smart enough to save for my retirement, so let me do it myself. I've already realized that there won't be any social security for anyone my age so I'm already saving with that in mind. Lets go ahead and take the next step and let me opt out of paying the social security tax completely. Obviously this won't happen since SS was never a 'savings' program anyways. SS was always designed as a wealth transfer program. A way to take care of the old by taking money from the young. The problem is that this plan only works when you have enough young people to take care of the old people.
Re:Um, or... (Score:4, Insightful)
In the US the cost of healthcare outstrips what you can expect from pensions and government programs, so healthcare eats into your retirement income.
Yes, we all know that no one who isn't within 10-15 years of collecting isn't going to. This doesn't mean that people who are collecting today are stupid for doing so. The spiking costs of healthcare make what would have been a livable stipend insufficient.
Re:Italians have spent pensions funds already (Score:3, Insightful)
That's why it is irresponsible to have an unfunded system. If workers were paying for their own retirement instead of other people's, then the system would be able to handle population changes a lot better.
We started out with an unfunded system because we had a generation that already needed care. Fine. But instead of using the last 60 years to crawl our way back to a funded system -- say, by making one year of progress for each year we ran the program -- we just decided to run it that way forever. So saving one generation from poverty has saddled us with a system that we can't ever get out of, even though it is a lot worse financially than individual retirements savings.
Re:Investments! (Score:4, Insightful)
Re:Sure, blame the income (Score:3, Insightful)
Don't forget credit card interest, aka The Stupid Tax. As a shareholder of a credit card company, I would like to thank all of those who finance their unnecessary consumption with a 30% interest rate.
It's amazing how many people voluntarily accept a permanent decrease in their income because they absolutely had to buy lots of crap years back, but never made more than the minimum payments.
Demographics Is Indeed Key (Score:2, Insightful)
Western Europe, Russia, Japan will be going into population decline. America is holding steady.
But holding steady isn't good enough if you want to have some huge nanny state (universal health care, Social Security, etc.)
Ironically, the people who support all those expensive long-term program are the ones having the fewest amount of babies.
As to retirement, less young folks mean you'll have to work longer. Unless there is a major leap in productivity.
Comment removed (Score:3, Insightful)
Re:Um, or... (Score:1, Insightful)
No, you're not. You make immigrants feel like criminals and second class citizens, people are afraid to come to your country on business these days. Plus, after absorbing Fannie May and Freddie Mac into the Fed, and being about to absorb a major bank into the Fed, you're poised to lose your AAA borrowing status from the world bank. Which means no more printing US dollars so the rest of the world can hoard them as oil currency instead of cashing them in for US domestic production. Which means you're going to move from being an empire to being a nation.
Face it. You're fucked.
Re:Um, or... (Score:5, Insightful)
My Dad is 78 years old and still runs his own accounting business. I truly suspect, as does he, that if he didn't, he'd be dead by now.
He uses the extra money he gets during tax season to take expensive vacations, usually in the late summer or fall, with my mom.
Nearly everyone my parents knew that didn't keep active have already passed on.
That said, if people can't afford things, I'd say it's partial evidence of the giant failure of social security. Would those pensions have lasted longer if that extra 12% went into a 401k instead of the SS black hole? Do people realize that SS has, since the first year, taken in more money each year than it's paid out? Where did all this money go? There'd be trillions of dollars if they'd have saved and invested it (even at safe moderate rates of around 5%). So where is it? The federal government takes every penny extra and leaves a worthless IOU.
When Bush pushes a spending deficit of $400 billion, he's not including $200 billion (yes, nearly $200 billion) that the federal government is "borrowing" from SS.
Even people earning minimum wage would generally have sufficient retirement funds if they were saving 12% in a personal retirement plan.
People also don't understand their pensions. They should be able to tell way ahead of time if they will receive an adequate amount of money.
The band-aid solution that was SS is making less and less sense. A real goal would be to create an environment that allows people to save enough of their money for retirement. Get the government out of the SS boondongle, refine the tax structure so that people are encouraged to save. Hey, even make it mandatory if you have to, but at least allow people to decide for themselves how to do it.
Also (Score:3, Insightful)
If people are living longer, well then they are probably going to need to work longer. Basically the simple economic way to look at retirement is that for the first part of your life, you spend less than 100% of what you make. That is saved for later. Then, when you retire, you stop making anything and start spending out that money you've built up.
All well and good, however the amount you save need to be balanced against how long you are going to retire for. If you live to 66, and work to 65, well then you don't need much savings. Saving 1% per year would probably do just fine. However if you live to 120 and work to 65, well you are going to need some serious savings. You might need to save damn near half your income.
Of course we don't know when we are going to die. However what we do know is that we are likely to live longer. So, the choice is save more or work longer. Well, many probably feel that work longer is a good option. As you said, many people don't just want to lie around the house. So instead you work for a longer period of time.
As life expectancy extends, this is what we as a society will have to deal with. We can either work for longer, or save more when we do work. Can't really have it any other way. You can't have the same retirement for 50 years as you can for 20 saving the same amount of money.
I personally don't see either as a bad option. I've no problem with people who want to live very thrifty lives so that they can stop working at a rather young age. Nor do I think it is bad for people who want to spend more and work for a longer period of time. Hell, maybe some people want to do both.
Regardless, it is a simple fact that as people live longer, they are going to have to deal with retirement differently. That many choose to work longer doesn't surprise me. Hell we have professors that work well in to retirement. These people don't need to work, if you've held a university job for a number of years you get a nice retirement plan. However, they like to work, and the university will allow you to work half time or less once you are retired. We have a number who do just that, some right until death. We had one professor die not long ago. Great guy, and in quite good health. Regularly played sports and such. Not sure his exact age, but over 70. However, one night his heart had simply had enough and stopped in his sleep. He worked his whole life, because he wanted to, not because he had to.
Re:Laboring longer . . . as we should be (Score:3, Insightful)
At 70 or 80 you just don't have the energy anymore, and you'll wish you had more time earlier in your life to do the things you wanted to do. At least this is the general feeling I've gotten from the elderly people I've met through my grandparents.
Re:Um, or... (Score:5, Insightful)
Private pensions aren't actually that good an idea. Lot of industries (steel, auto, airline) that gave pensions to employees are currently struggling under massive pension debt because of technological advances that have substantially reduced the workforces in those companies
That wouldn't be a problem if they had properly funded the pension plans to begin with instead of making promises that they had no intention of keeping.
Re:Um, or... (Score:5, Insightful)
You're wrong about immigration... people still come here in droves. The only unwelcomed ones are the ones that come here illegally, and that's always been the case and it's always been quite clear.
On the rest... I have to agree. The federal government has phenomenally screwed things up for about the past 80 years or so. It's a bipartisan screwup that's been going on for generations.
There absolutely needs to be zero deficit. I know some would argue about deficit as a percentage of GDP; I hear things like "Well, you bought a house, right? That was like 3 times your annual salary! Sometimes it's OK to have debt." Yeah, sometimes the government has a war [insert witty thing here] sometimes there's a natural disaster... but to go deeper into debt, year after year, with no end in sight, is just plain ridiculous.
Anybody who has any financial difficulty right now (carrying debt, interest rates go up, spending too much of their income to repay debts) knows this... if you were the federal government's accountant, you'd quit at such reckless spending. And it's been shown time and again how if a private corporation or individual tried some of the accounting "tricks" the government pulls, they'd be spending time in jail.
Re:Um, or... (Score:5, Insightful)
Either they choose to keep working, or they didn't put enough of THEIR OWN money away for retirement.
It is not possible for a significant fraction of the population to "put enough of THEIR OWN money away" so that they can sit on their asses for 25 years while enjoying a middle class lifestyle.
At the end of the day, somebody has to produce the goods that will be consumed each year. If too many people try to make "investments" for an extended retirement, they'll find that when they try to redeem them that the investments will be devalued until it matches the available goods produced by active workers.
The total goods consumed each year must be produced by people who work each year. The only way to manage this is to delay the average retirement age to maintain the overall ratio of workers vs. ass sitters. This really has nothing to do with whether the mechanism of supporting idle retirees flows through government paper notes or private paper notes.
Re:Um, or... (Score:3, Insightful)
You willfully blind people, always talking about money. Look at demographics. Look at how they are affecting what is currently happening in Japan. Old folks homes with robots and minimal staff, looking like the worst elements of the Matrix
Look at hyper-inflation.Watch some old videos of Russian grandmothers trying to buy bread with wheelbarrows of cash.
Understand that this is the future for all western cultures. Blame the chemist who sells the birth control and the feminists and capitalists who tell young people they should get an education and a mortgage and put off child rearing till their 30s or later. Blame the aftermath second world war for creating the cultural trauma that created this malignant social order. But for fucks sake, understand what is happening.
(Emphasis added)
I would like to understand "what is happening". I'm assuming as a pre-requisite for that, I would first need to understand what you are talking about. Do you have any recommendations for further reading starting from scratch for someone who knows nothing about history nor politics nor economics? I'm so uncertain about what you are talking about, I'm not even sure if those are the appropriate domains one needs to be knowledgeable within to understand what you're saying.
Re:Um, or... (Score:5, Insightful)
You can be financially secure by the time you're 60, though. All it takes is living below your means, something Americans just simply refuse to do. You are absolutely right that we've become a debtor nation, but as individuals as well as a whole country.
You know what? I don't care what anyone says; 99% of you don't need $100/month cellphone plan. If you are leasing your vehicle, you've likely made a really bad choice. I could go on and on... it's quite possible to save enough money to live purely off the interest (not touch the principle... and have a really nice "gift" to leave your children or favorite charity) if you make it a goal. Unfortunately, for most people, their lifestyle choices come first.
As we've delayed the maturing process in this country for so long, many people don't ever "grow up" and become responsible people. A nation of instant-gratifiers who whine that the government needs to help them out because they spent all their money on expensive cars and trips, put it all on credit so that they've ended up spending twice as much for something than they would have if they paid cash, and end up retiring with a buttload of debt that takes up half their retirement income.
Re:Um, or... (Score:3, Insightful)
So... lets outsource the caregiving to countries with young populations...
Re:Um, or... (Score:3, Insightful)
Why oh why is it that the folks who try and set up retirement plans seem to ignore this fact? I think what happens is that they look at an individual who is able to save up a lot and retire free - this works great for a single person, but when everyone tries it must fail. Just an example of the principle for which my econ profs would be disappointed to know I forgot the name where "what is good for one, is bad when everyone tries it".
In my opinion, the best "investment" is not in things which yield currency units, but in things which increase production (or increase robustness of production to environmental shocks) so that in the future there will be enough goods to go around.
Re:Um, or... (Score:2, Insightful)
Re:Um, or... (Score:4, Insightful)
The problem isn't the pension, the problem is that while we have "legacy" companies saddled with pension liabilities, we have simultaneously exported most manufacturing to countries to avoid paying fair wages and benefits.
50 years ago, consumer goods were made here, so your money represented an investment in your community, state or country. Today, when you buy something, you benefit employees of the mass retailer, the retailer's shareholders, and a few other players in shipping.
Better keep working-it's gonna get bad! (Score:3, Insightful)
The USA has 10 Trillion dollars in off-balance-sheet liabilities. Because of the way Social Security, Medicaid and Medicare are funded, when people in my age group (I'm 60) really start retiring, it's going to be expensive. There is no money there. If a private company ran it's finances the way the government does, somebody would go to prison.
Ok, ask anyone if they expect to collect Social Security, Medicare and Medicaid; everyone says yes, they paid, they're entitled. However, 80% of the people drawing these benefits will be capable of paying their own expenses. They are not poor. I am all for helping the economically disadvantaged, but why should the government steal money from productive workers and re-distribute it to people who are not needy?
I suspect that sometime in the next eight years, the money will be purposely inflated (making the benefits debt less expensive to pay out), taxes will rise dramatically, the retirement age will be pushed close to age 70, and finally, after all fails, the government will establish a means test, so that only the most desparate will be able to go to the front of the line for benefits.
Privatization of benefits actually worked for Chile. It could work for us, but it is almost too late.
Re:So what? (Score:2, Insightful)
You know what's cool?
More and more people these days, especially under 40 or so, are recognizing this kind of "I've-got-mine-so-fuck-everyone-else" screed for the blinkered, juvenile, simpleminded cack it is.
Re:So what? (Score:2, Insightful)
Needless to say, it certainly has nothing to do with three decades of stagant or declining real wages, obscene higher-education costs, or anything like that.
Nah. It's all because people are buying bigger TVs.
Re:Um, or... (Score:3, Insightful)
If you want to know why pensions are dying, look no further than the auto industry - most US auto companies offer(ed) pensions and were not able to compete with Chinese and Japanese companies that do not. It also looks bad from a debt load on the company's bottom line (unless they saved for it, but this is America - since when did anyone save? - they do, however, have to set aside some money). Pensions also put the employer at risk - it counts against their debt and ability to borrow.
401k has no such disadvantage - the entire burden and risk is put on the employee. Employers that still have pensions are those with nearly no risk - the US Government, for instance (can't pay the pensions? raise taxes!). I've had pensions twice, both times in large companies, and by (bad?) luck or coincidence my group was spun off just before the majority of employees vested in those pensions (I was a week away and had to transfer that money to an IRA). Incidentally, both times my company was spun off it was so the horribly unprofitable parent could skim a huge amount of cash off their profitable child so their stock wouldn't go junk (and neither company exists today because they sold off all their profitable groups).
Re:If only... (Score:3, Insightful)
Planning for your own retirement requires discipline and sacrifice (unless you make ludicrous amounts of money). Discipline and sacrifice are (generally speaking) in short supply here in America. The less money you make and the more necessary expenses you have (i.e., children) the more discipline and sacrifice is required. That's neither fair or unfair; it's an unavoidable ramification of the fact that not everyone makes the exact same amount of money and not everyone has the same necessary expenses.
There are some people who (for whatever reason) are unable to ever make more than a certain salary. Some of those people will cut their expenses to the bone just to survive and still won't have enough left over to save for retirement. This post is not about those people.
Most people that claim that they can't save for retirement haven't learned to sacrifice to that level or they don't have the discipline to sacrifice to that level. There is a large sense of entitlement and expectation of comfort here in America that is hard to overcome.
If you actually talk to people that are at or near retirement age and quiz them on their spending and saving habits for the past 40 years, you will in almost all cases discover that they either didn't address savings at an early enough age or they didn't sacrifice enough creature comforts to enable them to save sufficiently (and, more likely, both).
Americans need support to help them plan for retirement, because it's a hard thing to do. The kind of support they need is assistance in overcoming the constant bombardment of advertising that instills that sense of entitlement and learning to live within their means. They need assistance in understanding at an early age that they need to start planning for retirement as soon as they enter the workforce, and that it is not something they can put off or do casually but must do consistently and agressively.
What Americans do not need is assistance from the government. Seeing senior citizens at Wal-Mart working as greeters is not a sign that the government has failed its citizens. It is a sign that the culture that produced those senior citizens is not a culture that enables and encourages the kind of responsible behavior that would have led to a different outcome.
Every social ill that can be observed is not a candidate for government involvement. Government should not be brought in to solve the obviously visible symptom of an underlying cultural problem. If a social problem can be solved by people learning to be better and more responsible than they have been in the past, then that is what needs to happen. It is not in any way reasonable for the citizens of a country to say "We have been irresponsible and self-indulgent. We don't want to be responsible, so we would like for our government to provide us with a solution that allows us to continue to be irresponsible."
Re:Um, or... (Score:2, Insightful)
No thanks.
Re:Um, or... (Score:0, Insightful)
"Your statement is the sort of spin I'd expect from the neocons."
Really? Well this
"I know people over 65 who work 2 jobs, 7 days a week, to pay medical bills, rent, and food."
is the kind of anecdotal hyperbolic bullshit I expect from liberals.
Let me ask you a question, liar. What the fuck were those people doing with their money when they should have been investing it and saving for retirement?
Oh right, not investing and saving for retirement. They made choices, and no amount of pretending they aren't responsible for those choices changes that.
"As someone who is nearing that age, I'm trying to figure out how I'm going to retire without working"
As someone who is obviously smarter than you, I'm asking why the fuck you're thinking about this now, instead of when it would have made a difference.
Re:Um, or... (Score:5, Insightful)
No, but living for today doesn't mean not planning for the future.
What's irresponsible to is to put yourself in a position where other people must take care of you.
Re:Um, or... (Score:4, Insightful)
Now sum up 20% of my income power by 30 years or so, in interest-bearing accounts, minus inflation and it's enough to retire off of around 55-60 if you are determined and have your debts paid down.
Interest-bearing accounts minus inflation is negative now (and it's only going to get worse), so raised to the power of 30 that 20% of your income is pretty damn little.
Re:Investments! (Score:5, Insightful)
Make it optional.
Bad, bad, bad idea.
Social security is supposed to be the bare minimum income to subsist post retirement. By definition, anything less than that means you're can't survive. (If you really think social security today provides for luxuries, then we could debate reducing the percentages and payments.)
If you make social security optional, many people will chose to opt out (like you). Of those, some will invest on their own and earn more than social security would get them. Some though will earn less. By definition, the people who earn less can't survive.
What happens to all those people who lost their self-invested social security money and can't afford to survive? Simple. Government handouts . Just look at what's been happening recently with mortgages or the financial industry. You'd be foolish to think that the government wouldn't rescue any large group of destitute Americans whether those Americans did it to themselves or not.
Let me summarize then: Optional social security costs taxpayers no less than mandatory social security, because the government will have to pay for it all one way or another.
Oh, and producing large groups of destitute Americans is bad for social stability - and unstable societies protect its wealthy citizens far less than stable ones. It's sound planning to keep the masses subsisting regardless of your wealth.
Re:Uhhh, what the hell are you talking about? (Score:4, Insightful)
You need to look at history, not present day. It's not that the boomers didn't have kids - they *delayed* having kids, and had fewer of them. There is a significant dip in the number of births in the late 60's (i was born in '68). I noticed when I was a kid that there seemed to be a lot fewer kids in my grade than the higher and lower grades; their response was that, when I was born, it was very "unfashionable" to have children.
So now the boomers are starting to retire, and their kids are in their 20's, maybe early 30's - not peak earning years. the bulk of the taxes comes from those later in their careers, and there are a lot FEWER of them than there needs to be. So, IF we can get through the next 20 years without bankrupting the system, the boomer's kids will be supporting me. I'm not holding my breath.
As for population growth in the US, it is mostly due to immigration and higher birthrates among immigrant populations. Xenophobia aside, this is a GOOD thing - Japan and Europe are about freaking out right now because they are simply not reproducing enough to support their aging population, but they won't accept immigrants into their society in any meaningful way. Americans are going to have to deal with their caregivers probably speaking a foreign language and having different color skin, but they will deal. Japan is placing their hopes in robots - anything but outsiders. And Europe is placing their faith in...?
Re:Um, or... (Score:4, Insightful)
Here's the rub though... Money is created from debt... With the current monetary system, a reduction in debt also means a reduction in money. And since debt increases exponentially, there is always more debt than money. Running a balanced budget would cause an exponentially accelerating monetary collapse.
Basically, the banks have pwned you!
Re:Um, or... (Score:5, Insightful)
Fortunately for us, we're still in a position to attract skilled immigrants to make up the labor shortfall...That gives us the benefit of their labor, without having to have paid their costs as they were growing up.
Some are skilled, some are not and many are here illegally. There is no labor shortfall--only a wage shortfall. When you've got companies that are allowed to take their business overseas to use what amounts to slave labor without fear of tariffs. Or using illegal labor here, which has driven down wages. These are not jobs that American's won't take. These are jobs that Americans expect a fair wage to be set.
And illegal immigrants are hardly cost-free. We're paying for their medical, their children's education and medical. They're paying no income tax, they send the bulk of their money back over the border and have no plans to become American citizens. That's hardly a recipe for a successful country.
Re:Investments! (Score:3, Insightful)
"Social security is supposed to be the bare minimum income to subsist post retirement. By definition, anything less than that means you're can't survive."
No - that's what Social Security was SUPPOSED to be. It was originally and anti-poverty program, not a government pension program. But 2 things happened:
1) The government used a flawed measure of inflation, overestimating it substantially and therefore increasing the amount of benefits in excess of that required to keep up with the REAL rate of inflation. This had the effect of turning SS payments from a last ditch backstop to a substantial portion of retirement income over time.
2) Having been inadvertently (or purposefully) been given such largess, the elderly have made it quite clear that they intend to keep on getting it, and since they are retired they have nothing better to do on Tuesdays in November so they may as well vote. So now SS is the "third rail" in Congress - can't touch it, or it will kill you.
The ONLY thing that has kept this Ponzi scheme from collapsing is the large slug of baby boomers filling the coffers for a small number of retirees, thinned out by WWII, a lifetime of factory labor, and smoking. But now it is reversed - the boomers are retiring AND living longer, and there is a much smaller pool of workers to support them - the "baby bust".
I'm not sure what is going to happen over the next 20 years, but I know it won't be pretty.
Re:Um, or... (Score:3, Insightful)
Companies off-shored those obs to save costs. If they didn't the cost of everything would be higher the nit is now. Would you want to pay $10 for a gallon of milk? Or how about $50,0000 for that basic car?
Look at the companies that are having pension issues. Most (if not all) also have unions. Those unions were needed back in the 1920s and 1930s. But they have out lived their usefulness. They are now dragging down the companies and the people they are supposed to be protecting.
Airlines, auto makers, truck drivers, manufacturing all have major unions in them. The contracts almost always cost more to the company forcing it to either raise prices or look else where to cut costs. How many jobs do you still get paid even if your job goes away? Welcome to a lot of those contracts. The companies is paying past employees for years after they were laid off. The loopholes are huge. Look at GM's $17 million a year just on Viagra ( http://www.consumeraffairs.com/news04/2006/04/gm_viagra.html [consumeraffairs.com] ) The systems is messed up.
Re:Um, or... (Score:4, Insightful)
The AC is right. The insurance that doctors must pay to protect themselves in case they are sued is huge. often the insurance pays off the person rather then go to court so the doctor's rep is not tarnished. Which raises the insurance rates. These costs are passed to the doctors customers (us) and out insurance raising our rates.
Re:Um, or... (Score:2, Insightful)
Like it or not, we don't have the sort of workforce for a traditional manufacturing economy anymore. You don't put someone through 12 years of school so they can do a job that can be done by someone straight off the farm with little or no education (e.g. our workforce, 50 years ago).
We export those jobs for a reason. We have a highly educated workforce that is capable of doing work that not everyone is capable of doing. To keep those people from having to make shoes, pillow cases, and misc. plastic crap, we export those jobs to countries whose workforces are suited to those types of jobs, theoretically saving our skilled population for more skilled work.
Trying to re-import those jobs flies in the face of all modern economic thought. If they can do it cheaper, then we should use that to our advantage and focus our competition in areas where they are weak. We should not try to beat them at a game where they hold a strong advantage. The only way to make our good cheaper would be to jack up tariffs, and that would only make the same crap cost more, and thus sell poorly.
Re:Um, or... (Score:2, Insightful)
Try the filthy-rich health companies, including private hospitals, drug industry, etc. When you're paying for healthcare you are spoon feeding incredibly rich businesses.
Costs are less and less related to labor. It's been a steady trend for decades. The share of dividends and profits has been growing a lot more than salaries, in every business. Talk about "rich getting richer"...
I would simply forbid private healthcare, if I had the chance. It's like selling heroin, you can charge how much you want, people that need it will do anything to get it. You can even sell the most shitty product, you'll never be out of business.
Society, organised as a State, should provide quality health care for everyone. Throw away the greedy middlemen.
Comment removed (Score:4, Insightful)
Re:So what? (Score:3, Insightful)
I'm not sure how wages are stagnant, people have many more luxuries than ever. Hell three decades ago, most households could barely afford one shitty car, now they whine if they can only afford three SUVs.
Re:Um, or... (Score:4, Insightful)
Re:Um, or... (Score:3, Insightful)
Re:Um, or... (Score:3, Insightful)
Without state-run, mandatory retirement fund, people living on the edge will never save a penny. In my own country (and yours), millions of people make just enough to eat and pay rent. How are they supposed to make retirement plans and pay health insurance?
Fortunately we have a mandatory retirement and health care systems, if those people are ill they are entitled to medical care and when they are old they'll have a pension.
Re:Um, or... (Score:2, Insightful)
Maybe if we actually had a good plan. I mean, this statement:
I just ... I don't know where to begin. SS was created as a band-aid solution to an immediate problem; it was never meant to be a long term solution, it was always meant to revert to private accounts that created compound interest... this is simply not how SS works; it's a pyramid scheme that any private individual running would be thrown in jail for. Your money is already squandered... every single year SS has had a surplus; for closing in on a century, SS has collected more money every year than it's had to pay out. Where is that money? The federal government takes every penny of excess and leaves a worthless IOU.
There's no compound interest, there's no "lock box" where they keep your money... it's just gone. With an eighty year track record like that, I can only respond with the fact that the government has proven themselves untrustworthy... you HAVE to save on your own if you want a comfortable retirement, SS alone won't do it, and you'll be lucky to collect at all.
Re:Um, or... (Score:5, Insightful)
What you're saying is that laissez faire economics that favors the plutocrats is preferable to are more logical nationalist or even socialist system.
Thousands of highly skilled workers made shoes in Maine in the 1980's. Today they are chronically underemployed and their communities are in disarray because our society allows Chinese children with an inadequate standard of living to manufacture them instead.
The fallacy that Chinese are only fit for stupid assembly work is just as racist as the notion that African-Americans should be restricted to the fields that was common among white folks in the 19th and early 20th century.
The United States imports millions of laborers from places like Mexico and Guatemala specifically because they are easy to exploit. There are thousands of unemployed, low-skill workers languishing on the streets or eventually in prisons because they have no place to work.
Re:Um, or... (Score:3, Insightful)
Uhhh... I think you meant MediCARE. Eligibility is 65... so your saying your poor, pitiful parents have to WORK at age 57?!? What a tragedy!
Re:Um, or... (Score:3, Insightful)
Good post. People simply don't have their priorities in order. As I've said, we've delayed maturity for so long that many adults on into their 30s and higher have never reached the mental maturity they need to be responsible for themselves. They've just spent too many years being dependent with parents willing to string them along.
By and large, people don't need cable, or cellphones, or anything of the like. We need to keep pointing out that the "poor" people in the U.S. have a higher standard of living than the average European, with a bigger house, air conditioning, cars, color televisions...
Somethings not right. People need to get a grip, stop looking at what their neighbors are doing, and figure out the best plan for themselves.
Re:Um, or... (Score:3, Insightful)
No, what I'm saying is, if something costs a dollar to make here, and ten cents to make somewhere else, it benefits everyone who wants the product to buy the 10 cent version.
Only a Socialist would try to convince people that they're better off paying more for the same thing.
Nice strawman. The Chinese have an immense labor surplus; by and large it's not an educated population. That gives them an advantage in this sort of work. That's common sense, and it has nothing to do with their race, but only economics.
The reason the illegal immigrant workers are such a problem is because people like you are so protectionist of the crappy tree cutting, chicken gutting, fruit picking jobs that those people are willing to work, that we are unable to pass laws that allow them to work legally while protecting them from being abused by unscrupulous businessmen.
The problem with people like you is that you have this demi-religious faith that has nothing to do with the actual reality of the world, and you're determined to demonize anyone who disagrees with you. It's not a black and white issue. I suggest you educate yourself.
Re:Um, or... (Score:3, Insightful)
Consult a financial advisor that offers a flat rate for the meeting (Maybe around $300-400, be sure to confirm how they're compensated)
While this might sound like a bit of bank, they'll have no incentive to bullshit you since they're paid for the advice, not for selling you investment products. They'll just be there to maximize your money with no conflict of interest.
Tell them your life goals, and they'll help you price it out, compensate for inflation, look at your salary and expenses, look at investment vehicles, and help you set a savings number that you need to match to hit all of these things on time. It may need to be revised every 5 years or so to make sure it's still on track or if there are major changes in your life, but you're straightened out with a clear plan of how to afford your long-term plans.
Is it /really/ impossible to pay your own way in life? Have you seriously gone through the full calculations involved to confirm this? If this is true, then you'll just have to face grim reality. However, if you haven't done the math because, like most of the population, don't feel that you're prepared to do so much planning, don't be afraid to get help. There's no shame in feeling like you don't know how, nobody is just born with the knowledge, but it still needs to be dealt with. Remember, your money today is more valuable than your money tomorrow due to time value and compound interest. Get started ASAP, as in today, or tomorrow.
Re:Um, or... (Score:4, Insightful)
You're confusing the symptoms with the disease.
The union companies are the last ones left, because the bargaining power of the workers made it more difficult to just fire everyone and move to Mexico, Indonesia or China.
Prices have stayed low because the US has essentially been selling off its assets for the last 30-40 years to pretend that everything's all good. Sorta like getting laid off and selling your furniture so your neighbors don't think you're broke.
Re:Um, or... (Score:3, Insightful)
Re:Um, or... (Score:5, Insightful)
Well, you're wrong.
It benefits the offshore trading partners when a country like the US stops adding value to products and instead simply consumes. One way trade isn't trade, it's wealth transfer. The Europeans called it colonialism.
When you bought a widget for $1 made within your country, that money contributed to the US economy. The workers, the people who build factories, the people to harvest raw materials, power companies, the sandwich cart, the uniform supplier, etc. You're creating value.
When you buy the same widget for $0.10, you're injecting capital into the offshore trading partner's economy and gaining nothing in return. The offshore economy is adding value and creating wealth.
Just like the other guy who responded to me blaming the unions for all of our ills, you're misidentifying the symptoms with the disease. Immigrants aren't a problem, the problem is that government policy has made it increasingly difficult for low-skill Americans to get appropriate jobs.
Re:Um, or... (Score:5, Insightful)
Someone has a child; how does that put themselves into a position of dependency? And if it does, they shouldn't have had a child to begin with.
Wow. You really need to consider that life is a lot more complicated and messy than a couple of econ books.
First, 80% of the US population would have to wait beyond child bearing years, if ever, to be assured they have enough resources saved to have children. Do we really have to belabor what that does to society?
Second, there is no such thing as assured even when you have created a pile. People get sick or injured. Investments go sour. Jobs are lost and industries go away. It can be shocking how quickly a nest egg evaporates.
I am not suggesting that your message of responsible behavior is bad. It just needs to be tempered with reality and maybe a little compassion. I have met any number of people singing that song over lunch one day and quite a different song five years later.
Re:Um, or... (Score:2, Insightful)
Suffiecient living (Score:3, Insightful)
Maybe if people didn't buy flat panel TVs, new cars, laptops and homes they cannot afford they could live "sufficiently". The inflation of the past 3 decades certainly doesn't help either, but a pension manager is supposed to grow the fund to deal with inflation. I guess you get what you deserve when you trust a stranger to manage your future.
The less you save the longer you must work. It's simple as that. Of course if you want to work later in life, then by all means go ahead. We need some more people to shoulder the social security burden.
Re:Um, or... (Score:2, Insightful)
syea i am sure you make the "economic decision" that something that normaly costs 400$ is going to be over 1200$ i acouple years.. yea.. i am sure you saw that coming...
of course i saw it coming! health costs have been increasing double digits per year for well over a decade now. everyone knows this. this is widely available information.
Re:Um, or... (Score:3, Insightful)
Awesome! Then we can have the great customer service and dedication that the government is most known for!
Re:Um, or... (Score:3, Insightful)
And they'd be happy to do so too, sweetheart. More, when an illegal gets a job with a fake SS-card [yahoo.com], the SS-taxes are deducted from their pay-check, but they are not going to get the SS-benefits. They are taxed without being represented, and yet, these people are happy to work on these conditions — why aren't the Americans willing to work for the same money, while still getting the SS-benefits, and the representation?
The "minimum wage laws" are a misnomer, that we inflicted upon ourselves. But I digress — what's wrong with "cheap Mexicans", exactly? Oh, I know, it goes like this:
Sorry, not convincing...
Re:Um, or... (Score:3, Insightful)
Corruption. And careless disregard for costs. There's far too much incentive to inflate those costs. The more your medical care costs, the richer that ambulance chaser will be, which is just fine with the quacks-- more profit for them too. The insurance company might seem to be on the patient's side, but too often they try to weasel out and stick the patient with the full bill. Lots of fun when the medical care providers sic a collection agency on you for a bill the insurance should have paid. Your credit takes a hit for their misdeed.
Doctors do not have any incentive whatsoever to go carefully with a patient's money. If they make a mistake, you get to pay for it. Nor are they any good at finance if they did care. Most can't manage their own money, somehow managing to be broke despite making 6 figures. Patients are ill informed. If you want to know, you have to ask and ask and ask how much every "little" thing costs, until you get actual numbers not vague reassurances that it "isn't much" or "not to worry, your health insurance will cover it". You've got to check up yourself about alternatives, or they'll happily stick you with the most expensive one, whether or not something else is just as good or even better.
Into this target-rich environment steps the drug and medical device peddlers. The prices they charge for pills and equipment is an outrage. They'll do their utmost to make sure the patients are prescribed the most expensive, patent protected drugs. They have no interest in what drug is the best, only what is the most profitable. And they have a huge bag of tricks they use to steer and cajole the doctors into playing along. We have heard the effect this attitude has had on the music that is played on the radio-- it's degenerated into corporate crap.
The medical devices are as bad or worse. Here's an anecdote from personal experience: we needed a walker and a wheelchair for a month. A friend had these things, and we mentioned this at the hospital, but we were told we had to buy new ones. Couldn't guarantee the outcome of the medical care if we refused to buy certified equipment, you know. Of course they were ridiculously expensive, being provided by their preferred vendor-- no comparison shopping here! Was a juicy sale for them. Fooled us that time, won't be fooled again. At the same time, one of us was put on this "wound vac". It's just a little battery powered vacuum pump that maintains a constant low pressure. Having some knowledge of engineering, we figure such a device might cost $100 to make. The insurance was charged $1100 per week ($110 copay for us) to rent the thing, for 6 weeks. Had no idea it cost that much until it was all over because the bills didn't come right away. What is particularly infuriating is that the last week the pump was not used-- the doctor told us to keep it around "just in case". That was just the cost of that device, the full cost of all the care, the doctor's appointments, supplies such as bandages, saline solution, etc, was of course much more.