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Path: utzoo!watmath!clyde!burl!ulysses!mhuxr!ihnp4!zehntel!hplabs!hp-pcd!john
From: john@hp-pcd.UUCP (john)
Newsgroups: net.flame
Subject: Re: Social Security
Message-ID: <4000031@hp-pcd.UUCP>
Date: Wed, 9-Jan-85 12:16:00 EST
Article-I.D.: hp-pcd.4000031
Posted: Wed Jan  9 12:16:00 1985
Date-Received: Mon, 14-Jan-85 00:39:51 EST
References: <862@amdahl.UUCP>
Organization: Hewlett-Packard - Corvallis, OR
Lines: 34
Nf-ID: #R:amdahl:-86200:hp-pcd:4000031:000:1436
Nf-From: hp-pcd!john    Jan 10 09:16:00 1985

<<<

   It just goes to show that if you are going to be in a pyramid scheme,then
make sure that your on the top.

   The thing that scares me the most is all of these IRA's and 401K plans that
are popping up. They make great sense if you assume that there will be no major
change in the tax system over the next 30-50 years but that is very unlikely.
Social Security isn't going to just die. There will be years of trouble and
shortfalls that congress will try fix by drastic legislation. Possible examples
include:

1) raise the general tax rate. You shelter $2000 from a 35% tax rate to pay it
   later at 40%.

2) Drop FICA withholding and increase general tax rate by the same amount. That
   will not hurt the working class that are rioting in the street but will pull
   in extra income from taxing investment income. Who lives on investment 
   income? Why all the baby boomers who are retired and on a fixed income.

3) Nationalize all the IRA accounts. All payouts from your account will be made
   through the social security administration after deducting withholding and
   taxes. Of course your social security benefits will be adjusted according
   to your ira income.


You have to assume that in a squeeze between the working class that are taxed
to the hilt and the retired who need social security that the big losers will
be those who locked away large amounts into ira accounts.



John Eaton
!hplabs!hp-pcd!john