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Comment by coliveira | Hacker News Reader

But what to say about Americans, who squandered natural resources to help the rich, and now the funding to their own social security is en route to insolvency?

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It would be easy to make social security solvent far into the future. There's no shortage of resources to do it, just lack of political will.

One step would be to move it away from an insurance model and raise the cap on contributions. Another would be to modestly increase the contribution rates.

> One step would be to move it away from an insurance model and raise the cap on contributions. Another would be to modestly increase the contribution rates.

This is essentially what happened in the mid-90s with the Canada Pension Plan (https://en.wikipedia.org/wiki/Canada_Pension_Plan#1996_refor...): an increase of contribution rates to move beyond PAYGO solvency to a partial advance-funding model. As a result, the CPP now has a few hundred billion dollars in assets (invested largely in equities) providing income to support long-term solvency.

The downside of that is the Canadian pension doesn't provide a livable amount. One ex tech worker in Calgary who's collecting pension now told me it pays his electric bill.

If they do raise the cap on contributions people should have the option of either paying more in to social security or paying more into an uncapped IRA or 401(k).

Maybe a social security tax on capital gains.

Almost the entire point of raising the cap would be the resulting wealth transfer. Doing it with an opt out wouldn't fix the problem.

A fundamental difference is that for Americans, natural resources are owned by the individual property owner rather than the state. If you find oil on your land in the US, it is yours and you decide what to do with it. In most other countries if there is oil on your land, the government has the exclusive right to oil (or other sub-surface minerals).

Lol. No.

Usually where there are significant amounts of minerals, there are separate mineral rights. Mineral rights trump surface ownership, and usually the rights were sold off decades or centuries ago. If you find something under your property, it probably doesn't belong to you.

Also, state laws vary in weird ways. Should you find gold in New York, it's the property of the state.

Outside developed oil or coal plays, severed mineral estates in the US are the exception, not the rule. Also, to the point above, those severed mineral interests are almost always privately held.

Unless they happen to be on "sovereign" indian reservation land.

>But what to say about Americans, who squandered natural resources

Yeah, they squandered their natural resources on the way to becoming the richest, most powerful nation in the history of the planet...

How can people say things like this with a straight face? The fact that there are some tough political issues that have or may span a couple decades doesn't erase centuries of history, or millennia of future prospects.

Exactly right. Many Americans are so ashamed of the US, when in many ways it's a shining example of how to do things right -- certainly relative to many other countries. The US is a spectacularly prosperous country, and all it seems anyone talks about is how to fundamentally change the systems that made it that way. There are always in which a society can improve, but man -- let's not forget what's worked well.

> The US is a spectacularly prosperous country, and all it seems anyone talks about is how to fundamentally change the systems that made it that way.

The things that made America so wealthy were changed pre-2000. It takes time for those changes to really impact society, and for people to realize it. And no one really talking about "fundamental" change. They're talking about raising taxes back to what they used to be like in the 60s and 70s. Not just in terms of the rate, but the percentage of the tax burden that falls on each segment of society.

While there are many other proposals, that kind of tax policy change would, in itself, definitely be a big change. I encourage people to use this calculator to determine your effective tax rate at various times in the past. If your family is like mine, reverting to the tax policy of the 60s and 70s would be a very large hit to us every year.

https://qz.com/74271/income-tax-rates-since-1913/

I think the reasons for that are twofold:

1) There is a tendency to focus on the negative

2) The general trend of wealth inequality has been going in the wrong direction for many, many years and it is only getting worse

https://en.wikipedia.org/wiki/Wealth_inequality_in_the_Unite...

> when in many ways it's a shining example of how to do things right

US prosperity is largely a function of imperialism and military might, not some magical economic formula.

For instance, in South America:

https://en.wikipedia.org/wiki/United_States_involvement_in_r...

The US government overthrew a democratically elected government for the prosperity of a _fruit company_.

> all it seems anyone talks about is how to fundamentally change the systems that made it that way.

Many of the people are fighting the systems that have heavily exploited poor countries around the world for the last ~100 years because they see it as fundamentally immoral. The US doesn't _deserve_ the standard of living it has achieved, and it's built on the blood of dead South Americans and Middle Eastern people.

It's honestly pathetic that poor Americans aren't provided for given the absolute spoils of war the elite have enjoyed.

Oh please. If imperialism and military might were the source of a country's wealth, then Mongolia would be on top, and Russia, and the sun would have never set on Great Britain. No, strong property and contract rights combined with the rule of law and relatively low corruption is what made the US wealthy. And, yes, natural resource extraction and up until recently relatively prudent management of its fiscal resources.

Mongolia's dominance was far before the industrial revolution. That argument is so devoid of context it's not worth addressing. They did achieve huge gains in wealth through imperialism anyway...

The USSR was imperialist, and did achieve massive increases to the standard of living of the elite through imperialism. It's much easier to feed Russia when you can starve Ukraine.

Colonial Britain and the Dutch East India company both achieved massive gains in wealth through imperialism.

The only argument you've made is that strong property and contract rights with rule of law and low corruption can prevent squandering the spoils of imperialism. I'm not sure if I agree with that, we're too early into the US's age of dominance to tell, but it's adjacent to my point.

None of those countries stopped those practices. That is, they realized the end of their prominence due to policy positions and factors other than imperialism (or maybe even because of imperialism). That is, imperialism doesn’t necessarily make a country wealthy, and it certainly doesn’t keep it that way. Distant wars are expensive. See Rome. The US’s escapades in the Middle East May break it yet. No, I maintain that those imperialistic tendencies are not at all what’s made the US so prosperous, and they may in fact lead to its demise.

PS: You mean en route—sounds the same, but that's how to correctly spell the phrase.

America should seriously consider nationalizing its resources and using that money to either fund programs to reverse the trend of its declining life expectancy or at the very least reduce the deficit (and perhaps, one day, bootstrap a sovereign wealth fund of its own)

One of my clients at my old finance firm was Alaska’s oil fund. They do pretty well for themselves and dole out 2k/year in cash to everyone living there. It’s unsurprisingly a very popular program, though I’m kind of morally opposed to a government function like that.

The Norwegian fund is principally for our descendants. The state has a self-imposed limit on how much of the revenue of the fund can be spent each year, the capital is untouched as far as I know. Also what money is spent is spent by the state rather than by individuals; no guarantee that it will be spent wisely of course but a greater degree of likelihood that it will be spent on something of lasting value perhaps.

The Alaska Permanent Fund is unsurprisingly popular. To the extent that the state recently voted to cut essential services rather than to cut handouts from the fund:

https://www.nytimes.com/2019/07/07/us/alaska-university-budg...

> though I’m kind of morally opposed to a government function like that.

Yes, it's much better for the government to allow a single person to appropriate all that wealth for themselves. /s

The amount varies from year to year. It's mostly been less than 2k.

https://en.wikipedia.org/wiki/Alaska_Permanent_Fund#Annual_i...

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