Draft again

This morning there were stories all over the Associated Press and related places regarding a Draft. A pair of analysts, one pro-draft, one anti-draft, predicted that the US will need a draft in one year in order to maintain manpower levels in Iraq and elsewhere. This will restart debate on the topic once again.

I do find it interesting this line in the text of the article:

"Today, no leading politician in either party will come anywhere near the idea — the draft having replaced Social Security as the third rail of American politics,"

Which is very true. The idea of a draft is less popular than tax increases. No one wants one. This is one of those truisms of the political climate these days.

It also shows how Democracy works. Since the idea of a draft is so repugnant, it will take overwhelming circumstance to get one in place. The politicians in office know very well that if they vote to reinstate a draft they will definately lose votes in their next election, possibly enough to be unseated. This kind of pressure means that we are much more likely to pull out of Iraq before it is actually a good idea to do so than to reinstate the draft.

Though, if there are other circumstances in the world that demand our military attention a draft could actually be shoved through. Perhaps Taiwan formally declares independance and causes China to have a massive military buildup. Perhaps North Korea starts performing regular 'missile tests' over Japan, or even Alaska or Washington state. Either event will cause our military to have to take notice, and we just don't have the manpower right now. That can change if the threat is dire and immediate enough.

I still consider it very unlikely.

Retirement age

There is a proposal before congress to raise the minimum retirement age. This is a move that Democrats are fighting. And this is something that I do not agree with.

Back when I first started retirement planning, I had built in the assumption that the retirement age would be raised by the time I got that old. The baseline I had been using was age 71. The current proposal for a raise to 68 is quite reasonable. We ARE living longer than we used to be, so we do have to support ourselves longer than we ever had.

Retirement at age 65 means several things. First off, it means about forty years of earning money for daily usage, and to put away for retirement. Second, if you make it to age 65 in reasonable health, twenty years of post-earning lifetime can be expected. You never want to live past your savings, so it is a balancing act balancing life expectancy, savings rate, and burn rate once you hit retirement.

If Social Security's benefits are going to be decreased, and it looks likely that they will be, then it is up to private individuals to make up the gap. Most people can't just put more money in the kitty every month, so working a year or three extra is a fair way to make sure the gap is shortened. The 'private accounts' that are being bandied about are a higher risk way of making Social Security money last longer, but the borrowing it requires the government to undertake will hurt the economy in the long run.

This paranoia about the retirement age is come by honestly. My parents told me years ago that they were planning retirement without Social Security, since they figured the boomers would bankrupt it well before they got old enough to earn. It turns out that it'll probably still be around for them, so happy surprise. Being conservative in estimating the financial environment at time of retirement is a good idea.