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That leads me to my question, why on earth does this plan still exist?
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Good question. Because the government forces us to. If it was voluntary it would die.
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That the baby boom generation saved no money and bought on credit to dig their own hole is no ones fault but theirs.
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Many of us have saved plenty including paying FICA taxes for 35+ years which we were promised would give us the right to collect SS when we retire based on the amount of money we paid in FICA taxes..
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A problem for me this does not make.
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It's a problem for you in that you will have to pay for current retirees just like we have been doing all these years. I would have loved to have taken my FICA taxes and put them in a real retirement plan but they wouldn't let me. With personal accounts the younger folks may eventually be able to break away from this transfer cycle and have some real money to retire on instead of the piddling amount SS gives you.
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At it's current trajectory, this will be a problem for the younger generation to shoulder, and nothing about Mr. Bush's plan eliminates this. Even the presidents plan tactily acknowledges that the adminstration is afraid to reduce benifits or eliminate the system for the baby boomers.
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Yep, you will have to shoulder it just like we have all these years.
They are reluctant to reduce benefits because they know that we are already getting so little back compared to what we have paid in. You will notice that the polititians and their fellow government employees have exempted themselves from SS, they know the return is far better in private plans.