Re: OT: Politics [Was:Social Contract]
On 2006-04-30, Steve Lamb penned:
>
> No, not might. Most people. Some might choose bad investments.
> But by and large it is extremely difficult to do worse than
> Social Security. I think it's so bad that putting the money
> in a simple 3% interest savings account offered by any bank
> yields more in the end.
Even though I just ripped into you a few posts ago, you do have a
point here. It would be interesting if social security could be
altered so that (this is just off the top of my head here, so I'm sure
it's not by any means perfect, but maybe the glimmering of an idea):
1) By default, everyone pays into SS
2) Instead of the current system, every person has an individual SS
account, from which their own retirement would later be drawn
3) That account would invest in CDs or some other extremely low-risk
setup. Perhaps it could work like a bank instead, with an interest rate
based on balance (I'll admit I don't know enough about how banks work to
be sure that could work).
4) There would be a non-trivial, optional exam. If one passed the exam,
one could choose what to do with the money that would typically be given
to SS: leave it there, invest it, spend it on wine, women and song.
Whatever. But the exam would have to be good enough to ensure that the
taker is financially well-educated, and taking the exam would have to be
expensive enough to be a deterrent (shouldn't be a problem since it
would have to cover the costs of formulating the exam, etc).
The main trouble I see with such an approach is that someone could be
financially brilliant in a way not yet commonly accepted, and thereby
flunk the test. But I imagine someone like that could "fake it"
through the exam anyway by knowing the "right" answers.
>> The idea behind the Social Security system is that you shouldn't have
>> to know anything about stocks, bond or any other securities to have
>> your retirement protected.
>
> The idea of Social Security is to make people dependant on
> government and to buy votes.
Can't it be both?
--
monique
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