Just a reminder that if we had individual social security accounts, almost everybody could retire as a millionaire.

Let's use the example of Jill. She makes $25,000 a year, and we'll posit that she never makes any more than that.
Social security costs her 12.4% (6.2 directly, 6.2 indirectly) of her earnings, but in our example that money will go into a government mandated investment account composed of index funds.
That means Jill will contribute $3100 a year. Let's say that she does so from the age of 22 to retirement age at 68. At the historical average, inflation-adjusted, annualized return of 7%, she will retire with $1,017,496.
And by the standard 4% withdrawal rule, Jill will likely have enough money to fund her entire retirement and still leave some left over to her heirs. Indeed, Jill will "earn" significantly MORE in retirement than she did while working.
And if she dies early, all of that money goes to her heirs, a generational legacy of incredible socio-economic uplift for her children and grandchildren.
This could be an ordinary story. It is mind-numbingly, eye-boggling, rip-your-hair-out dumb that we haven't reformed our social security system to make it so.
But we almost did! We were one handshake deal in the 90s between Newt Gingrich and Bill Clinton away from getting it done. But then the Lewinsky scandal broke and the window started closing.

For that longer story: libertarianism.org/podcasts/build…
A friend challenged me noting that a 7% return isn't guaranteed. What if the stock market underperforms its historic average?

Good question. Let's run the numbers.
Here's the worst case scenario. The worst S&P 500 annualized return for a 40 year time horizon started in 1969. It was a very sad 4.2%.

If Jill had been 22 in 1969 and then we replayed the scenario above, the result when she retired 46 years later would be: $433,472.
Not nearly as good, no. But at a 4% withdrawal rate, that means she'd make $17,339 a year in retirement. Which is still higher than the $14,928 she make using the traditional social security system. (And, of course, she'd still have the additional benefit of heritability.)
And, of course, it's veeeeery questionable whether Jills of the future will even get that much out of our social security system given the underpopulation crisis. We're currently looking at 25% benefit cuts in the next decade if nothing changes.
In other words, the absolutely worst case scenario for individual accounts is still significantly better than the absolutely best case scenario for social security as usual.

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More from @PMatzko

13 May
It's important to understand the machinery of reactionary thinking so that we can see it as it's happening. The reactionary fears change that is disruptive to the social institutions they value & which undermines the cultural power they wield via control of those institutions.
Take the recent debate in conservative & Christian circles over Critical Race Theory. For those of us with scholarly training, this is bizarre not least because CRT (and the intellectual headwaters from which it flows, critical theory and the Frankfurt school) are old news;
they are products of theoretical trends in the mid-20th century. It's a bit like if your preacher, today, suddenly started decrying the trend of women with bobbed hairstyles and wearing flapper dresses.
Read 15 tweets
10 May
A good example of how a classic libertarian critique -- in this case anti-competitive rent-seeking -- only gets traction on the Left when plugged into a culture war framework w/ a victim from a sympathetic group.

A new ice cream store was delayed by months because an existing ice cream store filed a complaint w/ the Planning Commission.

San Fran has created a regulatory regime that discourages new entrants at the expense of consumers who pay out the nose for goods, services, and housing.
And certainly, the hypocrisy of the incumbent ice cream shop owner rankles! The attempt to frame their store as a small business and the competitor's store--which has one other shop in NYC--as some kind of corporate chain is risible.
Read 6 tweets
8 May
The signs of an impending, inflationary economic collapse are all around us: manufactured unemployment + massive fiscal stimulus + unlimited corporate lending + overheated stock market + increasingly exotic hedges + historic levels of corporate & governmental debt.
I mean, any *one* of these trends would be disconcerting, but it's all of them at once! Image
Read 5 tweets
27 Apr
If we did resurrect the Fairness Doctrine, it would have vast, negative, unintended effects. You couldn't just target Tucker Carlson or whatever pundit/outlet you dislike.

How do I know that? Because I wrote a book about those effects last time we tried the Fairness Doctrine.
First, let me note that the Fairness Doctrine didn't prevent "deadly lies." That was never in its remit. It was meant to balance points of view. So if your goal in resurrecting the Fairness Doctrine is to stop folks from lying, you'll be sorely disappointed.
Second, for half of its functional history (1949-1963), the Fairness Doctrine was essentially unenforceable. I could go into more detail, but for sake of time, think about how many people you'd need to employ to monitor every broadcast outlet to make sure they were being "fair."
Read 19 tweets
23 Feb
It's worth noting that Senate Democrats on the Commerce Committee did something very similar in 1967, sending a letter to every radio station in the country asking which of them aired "Radical Right" broadcasters and notifying them of upcoming hearings on the Fairness Doctrine.
Indeed, the letter was so successful at intimidating stations into dropping right-wing programs, that the point man on the effort, Bob Lowe, told an ally that "The Senate simply was losing interest in the issue" since the broadcasters "were not gaining ground."
This cleared the way for the next item on the agenda, which was to create a nationalized, public radio network to counter-balance conservative broadcasters.
Read 8 tweets
20 Feb
Having spent 2020 telling covid denalists that they were overly optimistic about the pandemic, I now look forward to spending 2021 telling covid maximalists that they are overly pessimistic about the end of the pandemic.
Telling a denialist in May that we shouldn't open bars back up = telling a maximalist in February that we should open schools back up.
Look, folks, the math is straightforward. ~13% of Americans have been vaccinated as of this week.

Read 11 tweets

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