Quote:
Originally Posted by Oerets
I see SS as Old Age insurance.
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Well, let's take life insurance. I take out a million dollar policy and your monthly premium is $1,000. (I have NO idea whether that's what it would be but bear with me.) Ten years later I'm dead. I've paid in $120,000 and my heirs get their million.
But let's say instead that I live for twenty years instead of ten. Now, I've paid in $240,000 in premiums. What's the pay-out to my heirs? Is it TWO million now? Of course not. My "deal" with the insurance company was for a million. That's all I'm entitled to.
Now, let's take Social Security. My "deal" with SSA is that my monthly payout will be based on what I paid in over the length of my working life, regardless of how long I worked or how much I made (up to $110K/yr).
With life insurance, the gamble is the amount of premium dollars paid by the insured. I have no more control over that than I do over how long I'll live. With Social Security the gamble's on the other end. It's about how long the government will have to pay out my benefits. They have no control over that.
Means testing would break the deal. It would allow the government to screw around with the payout for reasons outside the bargain between me and them. They shouldn't be allowed to do that any more than I should be allowed to renegotiate a higher monthly payout because I expect to be dead sooner than the actuarial tables say I will.
John