His failure to privatize Social Security. Italy partially succeeded in the same project. Now look:
The global market meltdown has created losses for those who agreed to shift their contributions from a government severance payment plan to private funds meant to yield higher returns. Anger is rising both at the state, which promoted the change, and money managers such as UniCredit SpA and Arca Previdenza, which stood to profit.Prime Minister Silvio Berlusconi's administration is now considering ways to compensate as many as 1.2 million people who made the switch, giving up a fixed return for private plans linked to financial markets. It's also letting people delay redemptions on retirement funds to avoid losses after Italy's benchmark stock index fell 50 percent in 2008, destroying 300 billion euros ($423 billion) in wealth.
To be fair to Bush and Berlusconi, their solution was flawed, but the problem it was meant to solve -- the inability of governments to meet pension obligations -- was very real. Is very real. You'll recall that long before the crash, US experts were warning that we will not be able to pay out all the promised Social Security and Medicare benefits -- that we would bankrupt ourselves. Now, out of the blue, the US government faces trillion-dollar deficits for years (so says Barack Obama, and I believe him). So, let's be thankful that Bush's reform failed -- but let's remember that we are no closer to solving the problem, and indeed the crash may have made the problem unsolvable. We are all going to be poorer and sicker in our old age, it appears, and there's not a damn thing the government can do about it.
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'Some questions are left unanswered: How many people would have invested that full amount if not "forced" to? IF they invested a much lower amount, what would be the nest egg then?"
sorry BobB but that is not the business of government. We all have decisions that we must make everyday of our lives. why should it matter how much money we set aside for retirement that is my business not the government's and not yours. Why must I retire at 65? Why can't I work as long as I want to?
'what do we do about those folks? Just ignore their plight as self-inflicted?"
to be hard-hearted yes! it is up to families to help each other. why is it the role of society as a whole and as represented by our government responsible for an individual's wrong decisions?
Bobb, I would have been one of those who would have gladly stepped out of SS. People forget how huge 15.4% of ones income is. That would be a huge sum of money. Most don't invest that kind of percent of their income in their Roths, etc. Yet through the years they make more money off their own funds. Lower income people have already been forced to contribute 7.5% of their income to SS with the employer matching. If you're already forcing them, at least let them choose where to put the money. The feds aready haven't cared whether they could afford THAT. But please, let's have some freedom, here! My dad earned a good living as a self-employed person. When he died five years ago, we were shocked at how pathetic his monthly SS check was, considering how much he'd sent in over the years. SS is a bad deal, people.
Re: Rod, our generation will probably make out OK, but the huge deficits piled up by Bush and the even bigger ones in the coming years by Obama will burden your children and their children and be an enormous drag on the mid-century American economy.
One word: 1945. The US government in the war years had piled up far greater debt (proportionally) than we are likely to now. It did not "burden" down the ecoomy in the succeeding years; in fact the economy did quite well for almost 30 years after. This is not to say that we will necessarily do well also with the Debt Of The Aughts, but it does show that high govermment debt levels does not equal economic doom.
Re: You are looking at this through the lense of a possible "outcome" for some people.
I think that looking at policies through the lens of humane concern for individuals is a lot better than looking at policy through the lens of abstract ideological rigor. People matter a whole lot more than mere ideas.
BobB are you aware that many local governments were allowed to opt out of the social security system? Galveston (can't remember whether it is the city or county) established a fairly conservative retirement fund that has done much better for the retirees than social security ever could.
I'm like Michele i would gladly let social security have my employer's 7.5% contribution if I am allowed to put the other 7.5% in financial instruments of my own choosing (most likely a mix of indexed mutual funds, bonds and money markets)
I said: "You are looking at this through the lense of a possible "outcome" for some people."
I think that looking at policies through the lens of humane concern for individuals is a lot better than looking at policy through the lens of abstract ideological rigor. People matter a whole lot more than mere ideas.
So, in your view it is best to bankrupt us all, rather than allow some individuals to do badly. That's not even the choice, but even assuming your incorrect conclusions about privately owning your own retirement, that's your decision. You'd rather have more than 15% of everyone's earnings be used very very badly, rather than do something that's great and good, because the bad makes everyone "equal".
You could take your greater than 15% of your earnings and put them in a coffee can and still it would be better for EVERYONE than Social Security is. You're willing to sacrafice national economic improvement, improved individual retirements, and great benefit to all, on the altar of "there's a chance someone might behave stupid".
Just using your own logic, YOU ARE WRONG.
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