Thursday, May 11, 2006

Culture of Philanthropy

Matt Frei has a nice article on the culture of philanthropy in the United States. I think Americans almost take for granted that when people are in need, whether chronically or as the result of a sudden catastrophe, people will go out of their way to help. They'll donate money, food, clothes, blankets, medical supplies, and even their time and skills to help those in need. Now that's the kind of thing that makes me proud to be an American.

Tuesday, May 09, 2006

There Can Be Only One

Was this really about a parking spot? Or the Gathering?

Relevant News? What's That?

Saturday morning at 8:30 AM, I got on the Beltway to go to my sister’s graduation in Harrisonburg (Congrats, sis!). By my calculations, I would get there with fifteen minutes to spare if I went the speed limit the whole way. Barring congestion on I-66, I expected few problems. After all – it was early Saturday morning. No one’s on the road!

As I approached the area where I-95N diverges from the Beltway, I saw Beltway traffic stopped. I turned on the WTOP traffic station just in time to miss everything but something about College Park and the fact that traffic was being diverted onto 95N. I got onto 95 North and took the next exit, which I knew was an East-West road. However, I’d never been West on that road before, so I made a brief stop to check the map. I saw the road would lead me to New Hampshire Avenue, just north of the Beltway. I figured since that would take me past College Park, where I thought the problem was, I’d be able to get back on the Beltway, having only lost about fifteen minutes.

I turn onto New Hampshire Avenue, only to see a cop car blocking the very entrance ramp I’d been planning to use. What? Okay, New Hampshire can get me to 193, which I know intersects with the Beltway.

The traffic report finally let me know that the problem was all the way in Silver Spring, where they had apparently shut down the Beltway in both directions for a “police investigation”. The radio said they were letting people onto the Beltway at 29 South. 193 West would also take me to 29 South. I’d probably lose another fifteen minutes, but at least I still knew where I was going.

Just as I was approaching 29 South, the traffic report announced that traffic was no longer being allowed onto the Beltway there. What?!? I’d just exhausted my knowledge of roads in the area. In a state of utter confusion, I turned around on 193 and ended up on 29 North. At a stop light, I checked the map again (thank you, Mom, for the map-reading genes). Sure enough, it turned out that 193 West ended at Connecticut Avenue, another road I knew. U-turn!

Finally, FINALLY, I got to Connecticut and the entrance ramp was open. As I merged onto an empty Beltway, the radio announced that the police had just started letting cars through two minutes before. Sure enough, a group of cars was coming up behind me. I’d just beaten them there. It was now 9:30 AM. Yes, I missed the graduation (but I did arrive in time take pictures and eat BBQ. Mmmmm. BBQ.)

Anyway, why the title of my post? Most people I’ve told this story to had absolutely no idea that a good five or six miles of the Beltway was closed for an hour and a half on Saturday morning. When I came back from Harrisonburg on Saturday night, I had to dig around to find out what the deal was. It just makes me wonder. It seems to me that an unplanned closure of the Beltway, a major thoroughfare in a major metropolitan area, should be a pretty big deal, especially to the local media. It affects a lot of people directly (even if it is Saturday morning) and is more relevant to day-to-day life than, say, the love lives of Bradgelina, TomKat, and Bennifer (1 or 2). Yet these things get hours of coverage over several days, even when nothing new has actually happened, while the beltway closure gets four sentences on page C03. The news ceases to be useful if it stops delivering information relevant to your life or at least relevant to a significant number of people. But does the media care? Apparently not.

Sunday, May 07, 2006

Why I Won’t Be Counting on Social Security

(this one's been simmering a while; we now join this argument, already in progress)

My cubicle neighbor and I argue about discuss Social Security on a semi-regular basis. You see, he’s on the opposite end of the career spectrum from me. He’s only a few years away from retirement while I’m just a few years out of school. He fully expects to get his social security check each month when he retires. And I fully expect him to as well. I just don’t think I’ll be getting one.


The U.S. Government will not collapse and the world will not end before I retire. Let’s face it, if the world ends or the government collapses, Social Security is a moot point. So we’ll just assume the end of the Mayan calendar passes without incident and move on.

I will live long enough to retire. Of course I won’t collect Social Security if I don’t live long enough to retire. So we’ll assume this as well.

Life expectancy will continue to increase at the rate of 1 year per decade. Those who believe we will achieve virtual immortality in my lifetime will think this too conservative. Others who see the obesity epidemic increasing the incidence of life-threatening conditions such as heart disease and diabetes may think I’m being optimistic. So we’ll just stick with current trends.

Given the above, the retirement age will increase to compensate for increased life expectancy So by the time I’m ready to retire, the retirement age will be 70. This means I will retire in late 2050, 44 and a half years from now.

Things working for Social Security’s future.

Entitlement programs are hard to get rid of. This is the strongest argument for why Social Security will still be around in 44 years. It’s politically awkward to tell people that they can’t have the money they’ve been expecting. “My grandparents got Social Security. My parents get Social Security. Why can’t I get Social Security?” And then the politicians scramble to find a way to cover the costs, even if it means cutting national defense (but not their own salaries).

Other entitlement programs are closer to a crisis, so “fixing” Social Security will be put off indefinitely. Medicare and Medicaid are the big money black holes in the budget right now, and they’re getting larger. Who cares if Social Security won’t be able to pay full benefits in 35 years?

No one wants to see old people dying broke in the streets. It’s just creepy.

Things working against Social Security

Social Security is NOT a savings plan. When people talk about Social Security, they often talk about “paying into” Social Security. You are not. You are paying for the people on Social Security now. People still working in the trenches and cubicles after you retire will be paying for your benefits then. And what you get out of Social Security isn’t really based on what you put in, as far as I can tell. (Is it just me, or does this seem like another way middle-income earners are screwed?)

The AARP says that Social Security is just fine – 100% of benefits can be paid out until 2041 (9 years before I'll be retiring) and the government is “investing” the money in U.S. Treasury bonds. But a U.S. Treasury bond is simply an investment in the government. The government is taking tax dollars out of one pocket and putting it into another, with the promise that they’ll pay it back with interest. So while Social Security is taking in more than it’s paying out, the government has a nice little slush fund to dip in to. When Social Security starts taking out more money than it takes in, not only will that slush fund be gone, but general tax revenues will also have to go toward paying off what was essentially a loan. To complicate matters, we’re not the only ones investing in Treasury bonds. Other countries are too. So when they start calling up their debt to pay for their own overwhelmed social programs, we may find ourselves in even greater trouble.

Tax reform. Oh, to have a simpler tax code! It would be nice if there were just a consumption tax, or flat tax for all income (Corporate income? Personal income? Dividends? Capital gains? It doesn’t matter! It’s all the same!). Sadly, you would have to eliminate tax shelters like 401ks and IRAs that encourage retirement savings, which would end up increasing people’s dependence on Social Security. But the payroll tax (some of which goes towards Social Security) would have to be eliminated as well. Then the government would be forced to treat Social Security like what it really is – a welfare program for old and/or disabled individuals or widows/widowers and their children. They would have to pull the costs of Social Security out of the general revenue with no regard to how much each person supposedly “put in”. With the switch in perception from “investment” to “welfare”, people would start asking (more so than they might already) why we’re paying perfectly healthy and wealthy people who happen to be older and not working so much money each month. Which brings us to…

Medicare/Medicaid/Social Security reform. Healthcare costs are increasing, making the need to reform Medicare and Medicaid all the more urgent. The need to reform Medicare and Medicaid sooner rather than later may distract from Social Security’s longer-term problems, or Social Security might just be lumped together with Medicare and Medicaid in the next big reform movement. I think Social Security as we know it – with retirement ages and benefits based on the individual’s average income – could be eliminated, replaced by something that would still provide something when our retirement savings run dangerously low (thus avoiding the “old people dying broke in the streets” epidemic of 2042). Maybe you would just be put on plain old welfare. Maybe you’d have to live in subsidized housing or a government-run nursing home. Or maybe you’d have to go on a crime spree and spend the rest of your days in prison. Rest assured, the government would find something to do with you. But your options would be limited.

I feel more in control of my own savings. Let’s face it, a lot can happen in 44 years. I’d rather save with the assumption that I won’t get Social Security and be pleasantly surprised by the windfall when I retire than assume that I will get Social Security, only to find I’m too wealthy, healthy, or young to get those benefits (or Social Security as we know it is simply gone) when I finally decide to flee the cubicle farm. Yes, I could run into problems of my own that would put a huge dent in my savings. But my hope is that all of the money I’m paying for various types of insurance (which I could otherwise be spending or saving) will count for something.

I’m sure I’ve left something out. But I can always address that in the comments.