Wednesday, February 09, 2005

Social Security

Well someone finally did it. Someone finally explained (to some degree) how private accounts could work and Social security fails. The scenario doesnt even seem plausible but at least it works on some mathematical level. Fewer taxes for corporations and stagnant wages for 75 years. Think MegaCorp Future. Yippee.

The interesting point is stagnant real wages would reduce future Social Security benefits. In effect, the wage index would equal CPI and therefore, it would have the effect of the cuts Bush has proposed. The question becomes is the net effect eliminating any solvency benefit the Bush cuts has and therefore, causing more problems (debt) down the road?

Someone still needs to ask why Bush is such an economic pessmist.

2 comments:

sig said...

It isn't sad. It is complicated stuff. And they don't want you to understand it.

Anonymous said...

You lost me at 'social'
<3
M