Quote:
Originally posted by taxwonk
Well, in a rational world, a large portion of retirees will have invested in a balanced portfolio of both debt and equity, and will be fine, if not as well of as they might have been otherwise.
Those who can meet the means test will in fact wind up getting some public subsidy. However, my estimation is that the total governmental outlays will still be less than the cost of raising taxes or going further into debt to repay the trust fund, plus pay in any additional amounts needed to fund the shortfall for the retiring boomers.
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The world of individually directed retirement accounts is far from rational, and I would think you would be aware of this. How do the comparative costs come out if a bunch of people keep their SS-replacement accounts in CDs or money market or stable value funds?
Also, if the system ends up with one group of people living off their accounts and another (poorer) group getting $ from their accounts and directly from the gov't, it's really identifiable as welfare (instead of being disguised, like it is now) and that will cause issues.
