Social Security?

No, I'm not according to the normal usage of "cherry picking." If you want to redefine "cherry picking" to your personal definition, OK but don't expect people to respect you or your misuse of language.
Wow. Did you really just say that? Let's see what life expectancy is..
Life expectancy is an AVERAGE of the life span. If they excluded everyone that died there would be no average, would there? Since the life expectancy is an average that includes those that died any formula based on life expetancy DOES include those that died. They are in the formula because life expectancy puts them in.

Picking between forecasts for specific scenarios doesn't make my use of that scenario "cherry picking." Since no one that is 30 years old has yet received any SS in retirement yet, all scenarios are projections. I have to use projected scenarios unless I want to use only existing SS recipients to show what SS returns and that would be deceptive, don't you think?

You have only proved you don't understand what terms mean. Life expectancy includes those that don't reach 65.
So? You however accused me of cherry picking in choosing that particular subset.

So.. just to be clear... the market return over 10 years was less than the return for the following groups according to Heritage numbers on SS return rates.
30 year olds married- 2 earners - low income
30 year olds married - single earner low income
30 year olds single female - low income
30 year old single males - low income
30 year olds married- 2 earners - average income
30 year olds married - single earner average income
30 year olds single female - average income
40 year olds married- 2 earners - low income
40 year olds married - single earner low income
40 year olds single female - low income
40 year old single males - low income
40 year olds married- 2 earners - average income
40 year olds married - single earner average income
40 year olds single female - average income
50 year olds married- 2 earners - low income
50 year olds married - single earner low income
50 year olds single female - low income
50 year old single males - low income
50 year olds married- 2 earners - average income
50 year olds married - single earner average income
50 year olds single female - average income
30 year olds married- single earner - high income
40 year olds married- single earner - high income
50 year olds married- single earner - high income


Heritage also charted for the ages in between and older than the numbers there. In all instances the older the person in the group was, the better their return on SS. The high income figure used by Heritage includes only about 6% of households. So anyone of an age between the numbers posted or older would also have a return higher of 1.2% or higher.

No, you didn't. Your "data" was not actual data but is based on misinterpreting data from Heritage. Plus you made up a meaning for the phrase "cherry picking".
You only provided made up data based on your misunderstanding of life expectancy and your cherry picking of 21 year old black males which is a subset of ALL males.


Funny stuff there. The data I used was LESS than the return for the majority as I already showed in a previous post. At least 80% of those age 30 or older will have a return of 1.2% or higher according to the Heritage. That means at least 80% would have a return higher with SS than the market has returned over a 10 year period. I don't think I ever said my numbers were the totality of return on Social Security because there is no such thing as a totality since it is an open ended projection. Younger people have a lower return based on changes in retirement age and tax rates. I haven't denied that. People born in 2050 might have a negative return on SS but that is not anywhere in the literature and is a SWAG.


Gosh, I guess that means I can't ever show the true rate of return because I can't project what the people born in 2050 will get from it. If you consider "cherry picking" to excluding ANY data then all science is cherry picking. Statistics is cherry picking. Heck, even common algebra would be "cherry picking" since it excludes imaginary numbers. You don't like the numbers so you have falsely accused me of cherry picking when it is clear I have not done so.
No, it shows you don't know what the hell you are talking about.

I don't really care if you "respect" it or not parados. So feel free to give it your utmost disrespect.



No, it doesn't. Social Security benefits don't directly correspond with the average life expectancy as an average. For example, if you die a year before your benefits start, you get 0, not just a little less. So while these people who die with no benefits bring down the life expectancy it doesn't correspond directly with the return rate of the Social Security program and the return rates you cite are just projections for that demographic.



And thusly all are inaccurate subsets of the data that you are using to extrapolate to the program at large.



You don't have to do anything parados. Cherry picking a forecast as representative of the totality of the Social Security return rate is not any better than acknowledging that you don't know what it is and can't know what it is.

If you want to make an educated guess, you shouldn't just cherry pick a demographic, and should factor in as much of the data as is available and portray the program with its full risk.

After all, you are comparing it to the markets with all their risk.



You throw around words like "prove" very casually. I understand very well what it means parados, but life expectancy does not have a direct correlation with Social Security's return rate. So the average lifespan does not correlate with the average return rate.

So even if you forecast off of the average lifespan with an average salary you don't get a number that corresponds with the average return rate. You just get the forecasted return rate for that particular demographic that is deemed the average scenario.

None of those forecasts will represent the totality of the program and Social Security's true return rate.



Actually, I've been quite clear. Cherry picking any of those forecasts doesn't represent Social Security's return rate except under those circumstances. Using such a subset to compare to the private markets does nothing to assert whether or not Social Security on the whole has a return rate as the market being compared on the whole. It merely indicates whether Social Security outperforms the market on the whole for that individual scenario.



If we suddenly want to be "clear" let's start with another apple you are comparing to an orange. There is no such thing as a 10 year return rate in Social Security.



Admitting your ignorance is better than just picking a forecast and pretending it's representative of the number you are not able to calculate.

It's no knock on you, there's just not data going back enough and reliable ways to project forward enough to get perfect data. But I'm not criticizing your data for not being perfect, I'm criticizing it for not being representative of the totals at all.



What you did was neither scientific, nor was it even statistically sound. You just picked a sample projection of an average scenario and called it the whole.

While you can't get a perfect calculation you can certainly do better than that if you actually try to calculate the total return rate instead of just picking a forecast that you think you can portray as representative of the whole.



Call a waaaambulance already. I don't care about how sensitive you are going to get about having your data discredited. If you can't show the criticism to be without merit this is just much ado about how you like your data to be characterized.

I'm not criticizing you for not getting the data perfect and perfectly inclusive. I'm criticizing you for making no attempt to ascertain what the total data is and just picking a subset to represent the whole.



As much as you'd like to think that, you know perfectly well that you haven't pointed out an error in anything I've said except to take issue with your data being characterized as "cherry picking".

Answer this simple question. When you compared the Social Security's return rate to that of private markets did you compare the programs return rate on the whole or just the return rates under common demographic simulations?

And if you accept that you used a subset, do you think your subset correlates to the total return rate?

If you do, I'll explain to you as simply as I can why it doesn't.

To get the "average" American demographics they are using averages of lifespan and salary. That way they can get a "common man" to run forecasts against. The problem with this is that Social Security's return rate doesn't directly correspond with these separate averages individually. People who die before the retirement age don't just get less, they get none. People who have higher salaries also pay into it disproportionately.

So finding the average salary, and the average lifespan and running the forecast doesn't get you a number that corresponds with Social Security's total return rate. It just gives you a forecast for that one average demographic, and that average demographic rate of return doesn't correspond with what the average return rate is going to be.

You may be right anyway, but your data did nothing so far to establish that.

One thing's for certain, there's no shortage of arrogance in this thread - on any side of the argument

Cycloptichorn

Figure 1-1.

Potential Range of Social Security Outlays and Revenues Under the Scheduled Benefits Scenario



Figure 1-2.
Potential Range of the OASDI Trust Fund Ratio Under the Scheduled Benefits Scenario, 1985 to 2105

The trust fund ratio is the ratio of the total trust fund balance at the beginning of a calendar year to total Social Security outlays in that year.



Figure 1-3.
Outlays for Benefits Under Current Law and Under the Scheduled Benefit Scenario, 1985 to 2105


Source: Updated Long-Term Projections for Social Security (March 2005)

Now, this ignores the fact that the government's deficit spending is currently operating on the surplus between Social Security outlays and revenues.

I imagine there's gonna be quite a shock to the system when we go to the trust fund piggy bank and find that there ain't no cash.

Starting in 2020 (according to the source I quoted), in addition to paying for government spending, we'll have to start finding additional funds to pay back the OASDI trust fund IOUs.

let speak american English.
This subject about SS i had dealt with both in Abuzz and here.
i know you people are individualist without any remorese to uplift the needy.
Your country sir is neither compassionate nor christian one.
See your electoral drama?
how come a country which had tortured more people than any barbaric country around the world.
How come Cuba a nasty blasphemout country had a better educational system.
Sell not your old song.
We are not with u
Rama Fuchs( Original name with civil, moral affliation)

DrewDad, I believe those graphs are now outdated based on the current bailouts of banks and finance companies. The extra billions thrown into our economy will impact not only inflation, the value of the US dollar, and our competitiveness in the world marketplace, there will be a time in the future when taxpayers will have to pay the piker. The value of social security benefits will mean very little under the current debt load of the feds.

C I
I beg you sir to revive issues by posting some subjects here.
I feel bored with the same old non-issue posts..
If i post some issues it will be ignored here for the simeple reason that my name is Rama Fuchs

I'd be happy to look at any updated figures that you can provide.

That's for the feds to provide, but don't hold your breath.

Hello, good morning. That is what some of us have been saying for years. And that is the point of Bush suggesting something needed fixing years ago. Some people continue to live in denial. Funny, some people in Congress claimed Fannie and Freddie were just fine not too long ago, no need to worry. I think some people knew something was haywire, namely Republicans suggested they needed fixing, but oh no, certain Democrats said no way.

Cyclo: Your complete lack of understanding in your own opening post makes this conversation absurd. I'll make it as simple as possible for you and then give up.

A. No one but a complete idiot would be wholly invested in one or two companies... and that certainly wouldn't be allowed as any kind of state mandated investment. That idea and your gotcha moment are equally ridiculous right off the get go.

B. A mutual fund is a bundling of various stocks that by design diversifies your investment dollar into many different companies; so while their performance will vary; it is not possible to lose all your money.

C. An Index, much like a mutual fund, diversifies your investment dollar into a wide range of companies; again making it virtually IMPOSSIBLE to lose all of your money.

D. When you consider that SS would be investing for the retirement of 150 million Americans, realistically, even the S&P 500 wouldn't be able to accommodate that much dough. In all likelihood; such a plan would have to go to a monster Index like the Wilshire 5000... or more realistically still; would involve the creation of its own Index encompassing most or maybe even all of the entire NYSE and perhaps other major markets as well. At any rate; it is beyond unlikely that the plan would be to allow every investor to make his own decisions and it would be ridiculous to think they'd be allowed to invest all their dough in an individual company or two. Such an absurd, to the point of idiocy, risk possibility would never pass muster to be voted into law. Never.

E. While it's probably true that with the retirement of the Boomers; productivity will not continue at a rate that will allow for the continuation of the 6.5 to 7 percent (after inflation) that the Market has averaged since the 20's... there is no reason to believe that it would ever fall below the 2 percent expectations (on the high side) of SS. Considering the market loosely follows the growth of GDP; if it ever did fall to that level; SS funding by comparison would be a veritable nightmare in itself.

F. You have consistently ignored the simple truth that SS as a form of retirement planning is a 40+ year plan. Whether a bad cycle happens at the beginning, middle or end, overall it is still the better bargain. Again; you can pick any 40 years in the history of the market (including those encompassing the Great Depression and WWII; and you will still be unable to show where the Market ever came close to matching the relatively paltry returns of SS.

G. Your frequent straw man about retirees preferring SS to "risk" is absurd, as the Market itself has a multitude of Low risk funds that are virtually as bulletproof as the Federal Government itself. Any honest viewing of the NYSE composite Index over the same lifespan of an SS investment will confirm this.

H. Ultimately, SS could simply be invested in a composite Index and that alone would virtually guarantee it's solvency for as long as the United States exists. While there would certainly be some fluctuation; over no 40+ year period would it be likely to dip below the abysmal return rates of SS.

I. You have also consistently ignored the simple fact that raises in Taxation that are guaranteed to be necessary to save our current system (this I think you've conceded); at worst would only be an occasional necessity for Federal gap protection... as opposed to the friggin guarantee of needing more dough that we are facing in our foreseeable future. Thus; at worst, it would still be a better, cheaper system.

J. ****. I guess that's enough.

ob, nice to see your post going at cyclops instead of me. I agree with most all of your points.

All of this more or less goes to the heart of liberal thinking vs conservative thinking. The nirvana of liberal hearts and minds is government, and any suggestion that private investment might be better than government is the ultimate insult to their emotional well being. Government is who they look to for everything good and benevolent.

For the most part, I attacked his ideas, not him. Just as I tend to yours. Watch:

This enormous Strawman doesn't even make sense. In the proposal I described above, Government would remain in control of the money; they'd just be managing it better. Does my avocation of continued government interference (mandating retirement savings) make me a bleeding heart liberal too? Is it completely impossible for you to have a non-partisan thought?

I feel extremly sorry for this post.
But I have some critical views about the regular participants of this forum.
SS is an important issue and not about the unwed third rate Vice president candidate or about the good old warrior who has no knowledge about the world.
A2k had degraded to such an abysmal level like USA to project a subject or topic which is irrelevant.
there are 248 members while I type this in dark room.
Why not political forum get a little bit attention?