A real fix for Social Security!

No, it is not. Read it twice.

It’s literally not stated in the article.

No, it doesn’t. It just makes it tenuous when the worker to retiree ratio is far lower than in the past.

I read it was for county employees. What if those people quit to move to another state and better paying job or are they stuck in that county until retirement age?

I did a quick search and cannot find how the program was originally funded.
But, TBH, that is really irrelevant because we know it works, and I could come up with an initial funding model in about 10 minutes.

It literally is the definition of a Ponzi scheme, there is no argument to that.

They would end up collecting from both the County system and from SS, with them getting a better return from the County system than SS.

Wouldn’t the original funding have come from people that were not yet at retirement age? The program would build up assets over time via contributions and investment returns. Im guessing they started the program initially with people below a certain age. Otherwise there would be nothing to pay people from. Some really great things from the Alternate Plan as its known:

Employees can elect to put their portion of the contributions into riskier investments, like mutual funds and stocks, potentially to generate more interest

At retirement, employees in the Alternate Plan can choose to take the money in a lump sum, take monthly benefits for a given time period or take a lifetime annuity, with slightly reduced benefits

Source: https://www.nytimes.com/2011/09/18/us/how-privatized-social-security-works-in-galveston.html

It doesn’t just outperform our SS Ponzi Scheme, it totally crushes it. This is what happens when you allow privatization of retirement instead of a Federal Government run system. The private system WILL ALWAYS outperform the Federal Government.

That would make sense, which is why I don’t give it much thought, they obviously had that handled early on.

In all aspects, even the disability part.

Im not sure you understand how SS was designed to work and why the flaws make it so unsustainable. Back when it was created there was like an 8-to-1 ratio of workers to retirees and the average lifespan was 65 or so. This meant that the average person was only drawing SS benefits for a couple of years after retirement. The withholdings from payroll flowed into the SS Trust Fund which invested the funds and would pay out the benefits from investment income.

The system was not designed for current workers to pay current retirees, but that is happening because the SS Trust Fund cannot generate enough income to pay out the benefits. This is also why the SS Trust Fund will be empty in around 10 years.

Nowadays the ratio of workers to retirees is substantially lower and the average lifespan has increased. This means there are more retirees living longer and drawing benefits. An additional factor is that the US birth rate has fallen for a long time. So as you can see, the system will not survive unless it gets more contributions or pays out less benefits. This is the common problem with a Ponzi Scheme.

I suspect that workers who retired prior to these plans continued to receive their pensions funded by whatever plan existed at the time. Those obligations would decrease rapidly over time (it’s been 41 years). Usually, when pension plans change, existing workers are given a choice - freeze your vested benefits and move to the new plan (sometimes being allowed to rollover their vested benefit to the new plan) or continue with the old plan. Give the elapsed time, I don’t know what options, if any, were offered. I am more familiar with ERISA plans than governmental plans.

Last numbers I saw were 2.8:1, workers to S/S recipients. Given the 62% labor force participation rate (it was 66% in 2009), I don’t expect that ratio to improve.

Yes it was. Current workers have always paid for current retirees. That’s how it works. The only problem is that the ratio changed because there are fewer workers and people live longer.

Every time someone comes up with some magical solution, such as this alternative plan, they leave this out. You can’t just design something for the future retirement of current workers and say it’s better unless you have a plan for people already retired or just want to leave them to the wolves. Nothing in the article about the alternative plan says anything about how people already retired are dealt with.

Which is why it needs changed.
No tinkering with retirement age, or BS about “fair share”, or any other crap.
Make the system one that makes financial sense.

WHAT??
The alternative plan has been working swimmingly for over 40 plus years, Railroad Retirement has been working for almost 90 years.

Literally nobody is saying that, you are pulling that argument straight out of your ass.

That doesn’t mean it wasn’t dealt with. It obviously was.

Basic economic principles are not “magic”.

You have not shown that in any way. You’re assuming it with no evidence. The article didn’t address it at all. The money for people who are already retired must come from somewhere.

Well, I am not going to take a trip to Galveston County and dig in their fucking archives!
The article didn’t address it because it wasn’t worth being addressed.

I am sure it did.

It wasn’t worth being addressed? It’s key to the whole thing. The alternative plan has money going into accounts apparently. Where does the $ for those who retired before it was created, or before it had enough funds, come from.

If you want to use this, or anything, as a model for reforming SS, you have to include that part. SS always had current workers paying for current retirees, with those who retired before the system existed never having paid in.

The processed worked until the boomers retired. The current and expected future workforce does not have sufficient numbers needed to support this system.

The real solutions is a combo of increasing tax collections currently and lowering payouts. In order to lower the payouts you need to increase the age requirements and lower the payouts via much lower than inflation annual adjustments. Just like the national debt, you can’t tax your way out of the issue. You need to reduce the payouts. This is where the rapid inflation will significantly help.

This isnt a magical solution, its something put in place over 30 years ago instead of SS and is working far better for obvious reasons. I know you love big government and its control over our retirement, but the real-world case study in Texas proves there are substantially better ways.

You keep leaving out how those already retired get funded. Waiting to hear that.

After further reading on it, I found that the new plans did not replace the countys’ retirement plan, it eliminated their employees’ participation in social security. Any prior retiree would have continued to receive their S/S. Any employees in 1981 that paid into social security would have their status and benefits frozen at that time. If that qualified them for future S/S (40 quarters of paying into S/S), they would get S/S. If they had not yet qualified for S/S, they would get none, unless they later changed jobs and accumulated the necessary time.

Sounds like what I have, STRS. I don’t pay into SS, though I have with previous jobs, and I won’t get it, but have my pension. That’s fine for a particular group of people, but you can’t just take that model national as the way to reform SS.

Not in an article 30 years after the implementation.

They figured that out in 1986, whatever they did worked, that is not in dispute except in your imaginary problem.

Like I said, I could figure that out in about 10 minutes.
There literally is already a solution posted on this thread.