"Because in Cyberspace, no one can hear you scream."
Thursday, February 03, 2005
[Media Source*] Hat Tip to In the Agora. According to the Cyber cast News Service (CNS) an experiment involving employees in Galveston County, Texas. Basically local employees opted out of paying into Social Security and instead voted in favor of a locally controlled system whose results have been described as a "phenomenal success."
Under Galveston's "Alternate Plan," the county withholds approximately six percent of each employee's salary for retirement. That money, along with a partial match by the county, is invested in personal accounts for each participating employee. The remaining county match covers the cost of disability and life insurance policies for employees, which also pay benefits much higher than those offered by Social Security.
The U.S. Treasury Bonds purchased with money from the Social Security "trust fund" pay approximately two percent. But for the period from 1982 through 1997 the rate of return on funds invested in the Galveston plan has averaged 8.6 percent, a return more than 400 percent greater than Social Security.
Social Security Reform Now!
It is a wonder that many Democrats oppose Social Security. Look at these results! I only wish that President Bush would have mentioned this. More below:
Data from First Financial Benefits, which administers the Galveston Alternate Plan, shows that county workers earning slightly more than $17,000 a year can retire at age 65 with a monthly payment of $1,285 compared with $782 a month under Social Security.
Due to having more money withheld and the effects of compounding interest, higher income employees in Galveston see even larger benefits under the Alternate Plan. Workers earning $51,263 a year could retire at 65 with a monthly benefit of $3,846, while the same worker participating in Social Security would receive $1,540 each month.
For the doubters who think that I am only showing the "highlights of personalization" read on:
Even the relatively low "guaranteed rate of return" in the Galveston plan roughly doubles the rate of return for Social Security. Funds already invested in annuities have a guaranteed yield of 3.75 percent, according to Bazaman. As for money being placed into private accounts today, Bazaman said the rate is slightly higher at 4.24 percent.
"They have never lost money. They have gone through double recessions in the 1980s, recessions in the 90s, and a tech boom and bust in the 1990s and into 2000," said Charles Jarvis, chairman and CEO of USA Next-United Seniors. "They've gone through another recession, an attack on this country and wars in Afghanistan and Iraq, yet they have steadily provided income for people."
This experiment has been going on since 1981 and look at where these workers are at! It is time the citizens of the free world (and those who claim to be but fight against it's principles) to reclaim the wages they earn from the communistic investment system (aka Social Security) and use them instead to secure their own future independent from the governments. Selah!
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Forget my question about capital gains. They didn't invest in a stock fund. They invested in conservative bonds.
But read the testimony of the judge who helped create the whole thing, and you'll see that this plan is so apples-to-oranges compared to what's being proposed by the administration as to be irrelevant.
These people got great survivor benefits because they purchased insurance -- in other words they paid into a non-closed system. Their money came from money put in by people outside their little group. There's simply no mathematical way for all 294 million of us to enjoy such a peachy payoff because if everybody's in it, only what got paid in can be paid back out. It all has to be zero-sum.
You're being sold the notion that somewhere over the next hill, this game becomes positive-sum, and we'll somehow get something for nothing if only we would all capitulate. It don't work that way.
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By Darnell Clayton â¢ 2:12 PM â¢ Email Post â¢ â¢
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