tag:blogger.com,1999:blog-17206839.post9068173613637088522..comments2023-09-09T09:26:22.175-04:00Comments on Andrew Samwick's Blog: Responding to JohnAndrewhttp://www.blogger.com/profile/13514024573333057559noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-17206839.post-14067951369230102972005-03-15T00:19:00.000-05:002005-03-15T00:19:00.000-05:00At the risk of sounding tendentious: Me: The Democ...At the risk of sounding tendentious: <br><br>Me: The Democratic plan should be...Social Security.<br><br>You: This is a reasonable position. If so, then I think that senior elected Democrats should be able to specify a plan to restore it to solvency.<br><br>Me: In fact, the Democrats have a proposal that’s every bit as substantive as Bush’s: put aside privatization, and come to the bargaining table to hash out a 1983-style fix mixing benefit cuts and tax hikes. Senate Democrats actually called a press conference to announce this position. It’s Republicans who are inveighing against this kind of non-ideological solution. --from Jonathan Chait<br><br>me: There's a good chance it will be fine if left entirely alone.<br><br>You: Based on the simulations in the 2004 Trustees Report, there is virtually no chance that it will be solvent if left entirely alone. Please see this chart. It shows that over the 75-year projection period, there is less than a 2.5 percent chance that the cost rate will be below the income rate at the end of the period. So I don't know what "it will be fine" means here.<br><br>me: http://www.washingtonmonthly.com/blogphotos/Blog_SS_Bankruptcy_2.gif<br>As this graph shows, the trustees' predictions have been laughably conservative. In fact, their yearly reports contain three predictions; a conservative, a middle (the one that gets all the press attention), and an optimistic one. <br>The optimistic one is the one that has historically been on target. The mainstream one, shown above, is consistently too pessimistic, while the conservative one simply needs to be scrapped.Johnnoreply@blogger.comtag:blogger.com,1999:blog-17206839.post-13920944215121200872005-03-15T00:30:00.000-05:002005-03-15T00:30:00.000-05:00You: So even in this scenario, uncapping the payro...You: So even in this scenario, uncapping the payroll tax base would be equivalent to about 0.2*12.4 = 2.5 percentage points of payroll. This compares to an unfunded obligation that is 1.89 percentage points of payroll when measured over the next 75 years and 3.5 percentage points of payroll when measured over an infinite horizon (see this table.) This is more than a tweak, and it doesn't really suffice.<br><br>Using your numbers entirely, it *more than suffices* for the next 75 years. Any measurements beyond that, as in "over the infinite horizon" are Alice in Wonderland numbers.Johnnoreply@blogger.comtag:blogger.com,1999:blog-17206839.post-24145179664519864982005-03-15T12:06:00.000-05:002005-03-15T12:06:00.000-05:00This post has been removed by a blog administrator...This post has been removed by a blog administrator.Anonymousnoreply@blogger.com