# Veep announcement \[Romney picks Paul Ryan\]

**URL:** <https://boards.straightdope.com/t/veep-announcement-romney-picks-paul-ryan/631157>\
**Category:** Politics & Elections\
**Created:** [August 11, 2012, 3:40am UTC](https://boards.straightdope.com/t/veep-announcement-romney-picks-paul-ryan/631157 "2012-08-11T03:40:58Z")\
**Posts on this page:** 2\
**Page:** 28

<div class="post-metadata">

**Author:** ![jasg](https://avatars.discourse-cdn.com/v4/letter/j/f0a364/32.png) [@jasg](https://boards.straightdope.com/u/jasg)\
**Post date:** [August 20, 2012, 12:27am UTC](https://boards.straightdope.com/t/veep-announcement-romney-picks-paul-ryan/631157/542 "2012-08-20T00:27:49Z")

</div>

> [@adaher](#):
>
> \<snip\>
> 
> Anyway, Social Security as it is now, is a system where what you pay in directly correlates with what you get out. That is a major part of the political viability of the program. Even if you’re rich, you get out based on what you pay in. Sever that relationship and that changes the nature of the program. Now rich people pay in many times more than they get out, and we’re defining rich not as the top 1%, but more like the top 10%.
> 
> Now, what happens to Social Security politically when it’s a bad deal for the top 10%?

I don’t understand this ‘directly correlates’ comment - can you please explain?

My reading of the [SSA.GOV](http://SSA.GOV) site shows that ‘what you get out’ (the [PIA](http://www.ssa.gov/oact/cola/Benefits.html), Primary Insurance Amount [calculation](http://www.ssa.gov/oact/cola/piaformula.html)) is progressive - it has a maximum benefit of less than $2500/month. Benefits do not increase directly with what you earn and pay in taxes - they are capped.

[[QUOTE=SSA.GOV](http://QUOTE=SSA.GOV)]  
For example, a person who had maximum-taxable earnings in each year since age 22, and who retires at age 62 in 2012, would have an AIME equal to $8,199. Based on this AIME amount and the bend points $767 and $4,624, the PIA would equal $2,460.70. This person would receive a reduced benefit based on the $2,460.70 PIA. The first COLA this individual could receive is the one effective for December 2012. See the monthly benefit amount for this example and other examples with maximum-taxable earnings.

[/QUOTE]

I also do not believe that ‘rich people pay in many times more than they get out’. Do you have a cite for that?

This [example](http://allfinancialmatters.com/2010/04/14/had-you-maxed-out-social-security-over-the-last-30-years/) \* shows that a theoretical ‘rich guy’ might have contributed $115,000 over 30 years. At $2460/month, it takes only 47 months for benefits to exceed contributions. Add in the employer contributions of $115,000 and you get another 47 months.

So, after a bit less than 8 years, the ‘rich guy’ will collect more in benefits than taxes.

- My cite also goes on to discuss the alternative investment return of SS taxes, but that is another debate entirely and should be ignored in the context of this discussion.

---

<div class="post-metadata">

**Author:** ![jasg](https://avatars.discourse-cdn.com/v4/letter/j/f0a364/32.png) [@jasg](https://boards.straightdope.com/u/jasg)\
**Post date:** [August 20, 2012, 12:30am UTC](https://boards.straightdope.com/t/veep-announcement-romney-picks-paul-ryan/631157/543 "2012-08-20T00:30:43Z")

</div>

> [@adaher](#):
>
> Cite? Here’s my cite: arithmetic. If every worker making over the cap is paying more in, but getting the same out, that’s a bad deal.

Huh?

If you make more than the cap, you stop paying in - not paying more in. That is why it is called a cap…

[Previous page](https://boards.straightdope.com/t/veep-announcement-romney-picks-paul-ryan/631157.md?page=27)