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Title: Bush: People Should Work More Hours To Grow Economy
Source: Daily Caller
URL Source: http://dailycaller.com/2015/07/08/b ... rk-more-hours-to-grow-economy/
Published: Jul 9, 2015
Author: Blake Neff
Post Date: 2015-07-09 09:31:10 by buckeroo
Keywords: None
Views: 8193
Comments: 97

Democratic operatives are all over Jeb Bush for declaring in an interview that Americans need to “work longer hours” for substantial economic growth to return.

The Republican presidential candidate was conducting a recorded interview with New Hampshire’s The Union-Leader and was answering a question about his tax plan, which he used as an opportunity to state his goals for economic growth. Democratic operatives are all over Jeb Bush for declaring in an interview that Americans need to “work longer hours” for substantial economic growth to return.

The Republican presidential candidate was conducting a recorded interview with New Hampshire’s The Union-Leader and was answering a question about his tax plan, which he used as an opportunity to state his goals for economic growth.

“My aspiration for the country and I believe we can achieve it, is 4 percent growth as far as the eye can see,” Bush said. “Which means we have to be a lot more productive, workforce participation has to rise from its all-time modern lows. It means that people need to work longer hours and, through their productivity, gain more income for their families. That’s the only way we’re going to get out of this rut that we’re in.”

According to OECD data, U.S. workers average 1789 hours of work per year, above the global average for developed countries. Among those with full-time jobs the average work week is 47 hours, according to polling by Gallup, while for part-time workers the average is about 26 hours per week.

Democratic operatives are all over Jeb Bush for declaring in an interview that Americans need to “work longer hours” for substantial economic growth to return.

The Republican presidential candidate was conducting a recorded interview with New Hampshire’s The Union-Leader and was answering a question about his tax plan, which he used as an opportunity to state his goals for economic growth.

“My aspiration for the country and I believe we can achieve it, is 4 percent growth as far as the eye can see,” Bush said. “Which means we have to be a lot more productive, workforce participation has to rise from its all-time modern lows. It means that people need to work longer hours and, through their productivity, gain more income for their families. That’s the only way we’re going to get out of this rut that we’re in.”

According to OECD data, U.S. workers average 1789 hours of work per year, above the global average for developed countries. Among those with full-time jobs the average work week is 47 hours, according to polling by Gallup, while for part-time workers the average is about 26 hours per week. According to the Department of Labor, about 6.5 million Americans are stuck in part-time rather than full-time jobs due to economic conditions. An aide told the AP that Bush’s intent was to highlight how many Americans have been working less than they want to due to President Obama’s policies.

“Under President Obama, we have the lowest workforce participation rate since 1977, and too many Americans are falling behind,” the statement said. “Only Washington Democrats could be out-of-touch enough to criticize giving more Americans the ability to work, earn a paycheck, and make ends meet.” The average hours worked of part-time workers has fallen sharply from just 15 years ago, something critics claim is partly due to Obamacare classifying a 30-hour job as “full time.” (RELATED: Obamacare’s Biggest Impacts: Americans Losing Hours, Losing Coverage)

Update: A transcript of the event forwarded to The Daily Caller News Foundation by a Bush campaign spokeswoman shows that Bush clarified his comments to New Hampshire reporters Wednesday night. When asked whether working “more hours” meant more Americans getting full-time work, Bush replied people needed to be “given the opportunity to work.”

“Incomes need to grow,” Bush said. “It’s not going to grow in an environment where the costs of doing business are so extraordinarily high here… If anyone is celebrating this anemic recovery, then they are totally out of touch. The simple fact is people are really struggling. So giving people a chance to work longer hours has got to be part of the answer. If not, you are going to see people lose hope. And that’s where we are today.”


Get the lazy, fat, do-nothing bureaucrats off their asses and force them to get a real job. OOPPSS! I forgot, they can't. In effect, a governemnt job is just another form welfare.

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Begin Trace Mode for Comment # 35.

#5. To: buckeroo (#0)

What is most disappointing here is Bush's total lack of ideas.

Rather than asking the 50% who do work to work longer hours, unemployed people should be returned to work instead of getting endless checks and "food stamps". And the retirement age should be raised, say, a couple months per year until the minimum age is 65. Or 67.

Social Security was never intended to be a retirement plan lasting 20 years or more for most retirees. It was predicated on half of all payees dying before retirement and the majority who did retire collected 5-10 years on average.

To see real economic improvement, you have to raise the employment rate and the retirement age. I would give bonus points to any pol who just admits this fundamental but unpopular fact.

Tooconservative  posted on  2015-07-09   13:27:13 ET  Reply   Untrace   Trace   Private Reply  


#7. To: TooConservative, buckeroo, All (#5)

Social Security was never intended to be a retirement plan lasting 20 years or more for most retirees. It was predicated on half of all payees dying before retirement and the majority who did retire collected 5-10 years on average.

Yet I and my employers on my behalf (in lieu of paying higher wagers to me) paid more into the SS system than I will ever get got, even if I live to 100.

SOSO  posted on  2015-07-09   17:14:42 ET  Reply   Untrace   Trace   Private Reply  


#16. To: SOSO, Too Conservative (#7)

Yet I and my employers on my behalf (in lieu of paying higher wagers to me) paid more into the SS system than I will ever get got, even if I live to 100.

Not true at all.

My employer and I have paid the maximum Social Security tax on me for the past 16 years, and will continue to do so for the foreseeable future. The amount has changed over the year, as the cap on the amount of the income taxed moves upward. In 1999, the cap was at $72,600. This year, the cap is $118,500.

Social Security tax is 6.2% from me, 6.2% from my employer. So, using 2015 as the measuring point (highest it's ever been), my employer and I pay a combined total of $14,694 per year.

If I were age 70 and retired right now, having paid into the system at the top rate for most of my working life, my monthly benefit would be $42,002 per year, which is $27,318 per year more out than I pay in this year.

Also, if I die first, my wife will get my Social Security until she dies.

And it will all be adjusted upwards over time for inflation.

Fact is, there is no investment program you could have done with that Social Security money that pays better, or that has better features (inflation adjustment and survivor benefits are huge advantages).

And if you get crippled between now and retirement, you get disability insurance. And if you die, you kids get survivors benefits.

Fact is, Social Security is an investment whose combined features cannot be purchased in the private sector at a reasonable price, or at all.

Add Medicare into the picture and it becomes even better.

Social Security will be the primary payor in your retirement, for your income, and for your medical costs, which will spiral upwards. Without Social Security, most people would be destitute in their old age.

Vicomte13  posted on  2015-07-10   9:47:37 ET  Reply   Untrace   Trace   Private Reply  


#18. To: Vicomte13, TooConservative (#16)

Not true at all.

It's totally true. You neglect the imputed interest rate that would be earned on what you and your employer "invests" into your SS account. Over a 30-50 year period of contributions that will much more than double the amount paid in. And what about those whose spouse also works and pays into SS? The surviving spouse is only entitled to the payment they have earned or just 1/2 of what the deceased spouse has earned, which ever is higher.

As for Medicare, I have private insurance which is primary over Medicare. It is unlikely that I will ever enroll in Medicare B or D. FYI we just had a super major medical event which to date has racked up over $300,000 of medical bills and Medicare hasn't paid one cent and will not pay anything in the future.

SOSO  posted on  2015-07-10   11:05:31 ET  Reply   Untrace   Trace   Private Reply  


#22. To: SOSO (#18)

It's totally true. You neglect the imputed interest rate that would be earned on what you and your employer "invests" into your SS account.

I did neglect that imputed interest. (I also neglected the taxation of the interest in any real account.)

This is an easy calculation. Actually, the amount I have paid in over my working life is easily determinable: I get that Social Security statement every year that says what I have paid in, and I can double that number for the employer contribution (which, lest we forget, is tax-deductible to the employer).

Then we look at the IRS imputed interest chart on long-term loans or, if you prefer, at the treasury rate, the bank deposit rate or CD rate during each year since 1981, when I started working and paying taxes.

One aspect of this investment is that it's a government entitlement, so the risk is the same level as treasuries: full faith and credit of the US government.

I guarantee you that after going through all that work, we'll discover that, no, the total will not "more than double the amount paid in". Especially not on a risk-adjusted basis.

Also, bank interest, CDs and bond interest is taxable, so we'd have to chop down your return every year for taxes. I suppose we could go ahead and consider that some of the money was invested in an IRA, but IRA's have upper- levels.

It all depends on how detailed you want the analysis.

I'm going to do it back of the envelope now, and demonstrate it.

Vicomte13  posted on  2015-07-10   12:55:29 ET  Reply   Untrace   Trace   Private Reply  


#26. To: Vicomte13 (#22)

I did neglect that imputed interest. (I also neglected the taxation of the interest in any real account.)

And the taxes that may have to be paid on the SS payments if one's total income exceeds a very modest level.

SOSO  posted on  2015-07-10   15:01:50 ET  Reply   Untrace   Trace   Private Reply  


#30. To: SOSO (#26)

Those taxes on the SS Payments are deferred for 50 years, assuming an age 70 retirement. The taxes on the interest are due and payable at once, year by year.

The average savings account interest rate since 1981 when I started working was 6.007%. It's a lot lower today; it was higher in the early 80s. The mean over that time is 6.007%.

Income taxes have been around 28%, which puts the net interest rate earned at approx. 4.325%.

I'll base the calculations on that.

Vicomte13  posted on  2015-07-10   15:30:02 ET  Reply   Untrace   Trace   Private Reply  


#32. To: Vicomte13 (#30)

Those taxes on the SS Payments are deferred for 50 years, assuming an age 70 retirement. The taxes on the interest are due and payable at once, year by year.

Payments into the SS sytem are with after tax dollars, i.e. - you paid income taxes on the contributions when made. So add that into your calculation as well.

"Income taxes have been around 28%, which puts the net interest rate earned at approx. 4.325%. I'll base the calculations on that."

You may start at that but I suggest a better rate would be on tax free A+ bonds and forget about the tax on interest earned. Also, one may total defer any accumulated interest until the retire or 70 1/2 which ver is older for a traditional IRA or never for a Roth IRA (remember the tax free traditional IRA to Roth IRA rollover period in you calcualtion if you wish to be totally accurate).

If you use 4.325% investments made 50 years ago will more than quadruple. Investments made about 29.9 years ago would have tripled. In fact investments made just years about 16.5 years ago would have doubled.

Are you going to assume that the maximum payment into SS is made by you and your employer in each of the 50 years?

SOSO  posted on  2015-07-10   15:45:53 ET  Reply   Untrace   Trace   Private Reply  


#35. To: SOSO (#32)

Are you going to assume that the maximum payment into SS is made by you and your employer in each of the 50 years?

No, because that is not the life that I've lived or that most people live. I'm going to use the actual amount I earned and paid into Social Security during each of the years.

I can see that a back of the envelope is not going to work, because you're going to pick at the result. So I shall have to be precise, and use the actual IRA contribution limits each year.

And there will be a few other things that must be factored in.

One is the cost of disability insurance, because Social Security is not simply a retirement fund, it's also permanent disability insurance. My uncle had a massive heart attack in his late 40s, did not die, but could not work. He had two children. He got disability until retirement. Had he died - a distinct possibility - his wife and children would have gotten survival benefits, inflation adjusted.

That is real, valuable insurance that would have to be purchased in the private market (if it existed).

Likewise the death benefit for the surviving spouse.

Inflation-adjusted insurance annuities don't exist, so a discounted present- value of money calculation will have to be made. The cost of that premium must be factored into the expenses of the "without Social Security" model. You don't get to take the ENTIRE Social Security amount and invest it at 3% interest. Some of that money has to pay for disability insurance, and for survivor benefit annuities, year by year. And the amount has to be adjusted upward for age and inflation. And a guaranteed insurability rider has to be placed on it. Private insurance will cut you off if you don't pay the premium, or when the policy expires and is reupped, and you can't buy the policy with a pre-existing condition. But Social Security disability insurance adjusts upward for inflation, has guaranteed insurability, and has guaranteed "premium payment" (it's paid out until retirement) with no further contributions.

Some of these features don't exist in private insurance. Some do, and they are expensive, and all of the money spent on that insurance each year is not available to sit and grow without interest.

ALL of the features of Social Security must be priced out and paid for, to REPLACE Social Security in all of its protections at each stage.

We cannot pretend that Social Security is merely a retirement annuity. It's also disability insurance and a survivor annuity.

Vicomte13  posted on  2015-07-10   17:19:38 ET  Reply   Untrace   Trace   Private Reply  


Replies to Comment # 35.

#37. To: Vicomte13 (#35)

No, because that is not the life that I've lived or that most people live. I'm going to use the actual amount I earned and paid into Social Security during each of the years.

Don't forget to add what employers paid into your account as well.

"I can see that a back of the envelope is not going to work, because you're going to pick at the result. So I shall have to be precise, and use the actual IRA contribution limits each year."

Do you want it quick or do you want it right?

SOSO  posted on  2015-07-10 18:19:03 ET  Reply   Untrace   Trace   Private Reply  


#38. To: Vicomte13 (#35)

One is the cost of disability insurance, because Social Security is not simply a retirement fund, it's also permanent disability insurance. My uncle had a massive heart attack in his late 40s, did not die, but could not work. He had two children. He got disability until retirement. Had he died - a distinct possibility - his wife and children would have gotten survival benefits, inflation adjusted.

How was the amount of your Uncle's disability payment calculated?

In case you haven't noticed in recent years the rapid run-up in disability claims is a scandal of massive fraud to which the Fed has turned a blind eye.

SOSO  posted on  2015-07-10 18:22:16 ET  Reply   Untrace   Trace   Private Reply  


#41. To: Vicomte13, TooConserative (#35)

Go ahead, add in the cost of the equivalent cost of a 50-to-life time term life insurance policy that your Uncle could have bought when he was 18 or 20 (which probably was well under $500/year average over the past 50 years). Also add the cost of a similar disability insurance policy (which was also likely well under $500/year average over the past 50 years).

However, I will concede $1000 year as the average cost over the past 50 years for the private equivalent of what you claim is de facto SS life and disability insurance policies. If you choose a different amount please document the basis and justification for it. HINT: The cost of a $1 million today for 20 year term life policy for a 30 year old man in good health is less about $37/month. For a 40 year old man it is about $56/month. These are to costs today and are much, much higher than what they were in 1965 or 1975.

BTW, did your Aunt and any of her dependent children that were factored into the SS disability payment have to pay any taxes on those payments? If so please factor that in.

But remember what TooConservative claimed, i.e. - that ON AVERAGE (statisically) one will get back from SS what one had been paid into one's account. So you may wish to tailor your analysis to the AVERAGE SS recipient, e.g. - a white male who paid into the system since 1965 and retired at age 66 at full reitrement benefit and a life expectancy of 76.4 years old. If you chose to do this I would use the assumption that this person earned the national median individual (not family) salary for each of the 50 years he worked and what he and his employer(s) paid into the system each year was based on this earned income amount.

Good luck to you.

SOSO  posted on  2015-07-10 19:10:25 ET  Reply   Untrace   Trace   Private Reply  


End Trace Mode for Comment # 35.

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