On the Kerfuffle over "Dr." Jill Biden

 

By the Right Honourable Reverend Dr. Mark L. Burkey, Esquire, Ph.D., M.A., BSBA, Etc.

On Dec. 11th Joseph Epstein wrote a piece in the Wall Street Journal entitled "Is There a Doctor in the White House? Not if You Need an M.D. (Jill Biden should think about dropping the honorific, which feels fraudulent, even comic)"  As always, English is a dynamic language, and words change meaning over time.  What most people don't know, is that Jill Biden's title of "Doctor" is the one that came first.

The Briefest Version: 

The word "doctor" is derived from a Latin word meaning teacher. The real meaning attached to this term has fluctuated wildly through time- meaning everything from one of Jesus' Apostles, to a title awarded to career scholars later in their careers, to meaning literally nothing but an honorific people gave themselves (similar to "Reverend" or "Esquire" today). In my historically-justified opinion, the term Doctor should be reserved for people 

1) holding the highest degree in their field of study, and 

2) who not only are practitioners (or users) of knowledge, but people who actively do research to increase the knowledge available to humans. 

Certainly, people who are neither hold the highest degree, and also are not learned scholars, should never be called "Doctor".

Since Jill Biden has an ED.D., which is the highest degree in education, but is not really a research degree, she meets one of these two criteria.  However, most physicians ("Medical Doctors") also only meet one of these two criteria. If you call your physician "Doctor", then you should also probably do the same for Jill Biden.  However, in modern times I prefer to do away with all of these archaic and vague honorifics that are more often than not misused, and appropriated by people who don't deserve them.

The Longer Version:

Here, during these days where anything is a possible topic where political opinion is somehow relevant to facts... After 11 years in college I earned a doctorate (and 3 undergraduate degrees, 1 MA degree), but not so I can force people to call me "Doctor". Well, unless I run into one of those people who insist that I call them "Doctor". Honestly to me, honorifics of all types are passe' and mean less and less as more and more people add random honorifics and letters before and after their names. Just as "Colonel Sanders" was not a real Colonel, and anyone can add "Revered" to the front of their name or "Esquire" after it, and I saw a resume' recently where someone added so many random letters after their name, that the detritus was long than the actual name. 

Though words change meaning over time, it is often instructive to look at word origins when we are unclear about meaning. The word "doctor" comes from the Latin docēre, which means "to teach". If we go way back, docendi meaning "teacher" was used to refer to early church leaders and teachers, including the Apostles themselves. Universities were originally created by, and controlled by church authorities, so as universities became more independent from the church, this original title docendi was lowered in prestige and required qualifications below the degrees called "Magister" and "Doctorate".  Originally, the three main fields of study in universities were of course theology, along with law and medicine. People who studied anything outside these fields were called "philosophers" meaning "people who love wisdom", which is why we call a doctorate in the vast majority of fields a Ph.D. (Doctor of Philosophy). 

The title “Doctor” was created during the renaissance in the 1300's to describe the highest level of learning in a field- the most eminent scholars, and usually awarded to people who were middle-aged. It was not just a title given to people after studying in the classroom, but reflected a life dedicated to teaching and learning. This term was reserved for the most respected scholars. 

However, later on things reversed themselves- since the title "Doctor" was not protected by any law, by the 1800's quacks and frauds called themselves "Doctor" so often, that the term actually fell out of favor among those with real Doctorate degrees- and instead people started writing their qualifications after their names (e.g., Mark L. Burkey, Ph.D.).  

 Also, the level of training of physicians began a race to the bottom until it became a joke. People with little to no training who earlier called themselves surgeons or apothecaries (pharmacists) now promoted themselves to being called "physicians" and "doctors". In the 18th century, serious students of medicine could earn both a bachelors and a doctoral degree in medicine, even though the bachelors degree only took one year to get.  So many people studying medicine simply left after one year and still called themselves "doctor" that in 1789 the best medical college in America set the standard by eliminating the bachelors degree entirely, forcing people to get an M.D. before they got any certification in medicine. 

While this sounds promising, at the same time  and making the only entrance requirement to begin studying for a medical "doctorate" was that students had to take one course in "natural and experimental philosophy" (Starr, p. 43). In 1789 in the US the term "Doctorate" at the leading medical school was used for what was much less than a bachelor degree- basically requiring 1 year of courses and 3 years as an apprentice.  Now, on to Lawyers...

A JD is not a real doctorate degree, which technically should a) involve original research, and b) be the highest degree in a field. In the US, a J.D. is the first degree someone can earn in law, takes only 2-3 years, requires no research, and the prerequisite is only a bachelors degree.  In every other field we call this kind of degree a "masters" degree (A Master of Law is the highest law degree- why law chose to get it backwards, I do not know). Additionally, many argue that an M.D. is not a true doctorate degree either- in 17th century Scotland, physicians decided to steal the term "Doctor" as a title, just as lawyers decided to call themselves "Esquire" (servant of a knight) in the US.  A rose by any other name would smell as sweet, but a masters degree by any other name doesn't make it a doctorate.

What is up with all of the country ranking "Indexes"?

Link to Video related to this Blog Post

A fairly recent, and continuing rage among data wonks is the creation of ranking indices (or indexes). Of course, we have had  indexes for many,  many years—  an old historical example is the Dow Jones Industrial Average. And of course, we use similar techniques to compute FIFA World Rankings, university rankings, and more. What is more recent is the creation of myriad indices for countries around the world (as well as US states) which are used to rank them on every conceivable topic. A random selection of these are:

The Economic Freedom Index

The Global Peace Index

The Good Country Index

The Global Competitiveness Index

Rule of Law Index

World Press Freedom Index

Happiness Index

Global Innovation Index

Global Entrepreneurship Index

Social Progress Index

Corruption Perceptions Index

Animal Protection Index

The Big Mac Index

Global Hunger Index

Quality of Life Index
Quality of Death Index

I could go on listing these for days! Basically, if you want to create an index,  sit down and decide on some factors that you think would go into explaining an idea such as "Happiness". Collect some data on these factors, and then figure out a way to create a sort of weighted average of these factors, adjusting them to a similar scale. A BurkeyAcademy subscriber Wrote in to ask me about the United Nations Development Programme's "Human Development Index". He wanted to know how was calculated. Let's have a look.

Looking at their 2015 report, they list the variables used to construct their index: Life expectancy, expected years of schooling (for young children now), mean years of schooling for all in the country, GNI per capita, and though it is unclear if (or how) they use this in their ranking, the difference in GNI ranking and their own Human Development Ranking (they could include this difference in their ranking in a recursive fashion using several steps).

Excerpt from Table 1, page 208, Human Development Report 2015, UN Development Programme

In order to figure out how this was calculated, my go-to tool is a regression. Regression attempts to discover the formula for a relationship, if you assume the function's basic form. Using a subset of 34 countries gives the following results:

For the uninitiated, the important things are the "Multiple R-squared" of 0.9966 tells us that our equation is an almost perfect fit; and the "Estimates" give us the following formula:

HUMDEV= -0.154 + 0.00767*LE + 0.0114*EYSB+    0.0187*MYS + 0.0000005936*GNI - 0.001154*GNIHDI

It appears that the "GNI rank - HDI rank" does help predict their ranking index. Exactly how they did it, I don't know — they might explain it in the document, but I did not read it fully. So now, we understand how they calculated it — what we do not know is exactly why they chose these particular numbers as weights. Again, perhaps they mention it in the 250 page report, but generally  these weights are chosen subjectively  based on how important the creator believes each factor to be, and then normalizing the result to be an index between zero and one or zero and 100. 

Go and read about some other indices, and have a go at creating your own! Here is a link to an excellent article on indexes from The Economist magazine.

North Carolina's Idiotic "Price Gouging Law" Increases the Pain

When anything becomes more scarce, the price MUST GO UP. Additionally, if something suddenly becomes more useful, the price will also go up. The price going up is a GOOD thing, and this is what people need to understand. Threatening businesses with fines for selling something we need is not going to magically make more of that thing appear in the state... quite the opposite.

Many states have "price gouging" laws.  In North Carolina the law basically has two provisions:

1) The Governor or President has to declare that some sort of "triggering event" has occurred.
2) Then you can't charge a price that "unreasonably excessive". What that means is left unclear.   However, you can be fined $5,000 for each violation, which probably means for each sale made to a customer.

Our esteemed governor of North Carolina declared a triggering event has occurred due to the Colonial Pipeline leak that was discovered on September 9th, 2016. Because this pipeline supplies almost all of the gasoline to the area, gasoline is much more scarce, and the price should go up for two good reasons:

1) Existing gasoline should become more expensive in order to encourage conservation-- people will treat this more precious commodity as more precious, and try to use less where they can.

2) When the price is higher, there is an incentive for people to find other ways to transport this good into the affected areas.  At a high enough price, it will be worthwhile to ship gasoline by truck or train into North Carolina, to help alleviate the fact that there is little gasoline to be found.

In economic terminology, the Price Gouging Laws basically put a price ceiling on the price of gasoline, keeping the price from going up. Gas prices have risen a little bit, but no gas station can know at what point they will be put out of business for charging a price that is "unreasonably excessive", and fined thousands of dollars.

So, the result is predictable, just as when Nixon did it back in 1971.  When you don't allow the price to increase, people don't conserve, and people don't find ways to being in additional supplies.  These laws only make a bad situation worse. So, gas stations are just shutting off the pumps, and people are driving around for many miles hunting for gasoline (which again, is wasting gas, not to mention time).  Which raises the question: 

"Which would you rather have: no gasoline at a low price, or as much gasoline as you would like at a higher price?"

According to this news report:

WFMY News 2's Meghann Mollerus met several drivers Monday morning who said they weren't as concerned about the price as they were about finding gas at all. "I just wanted some gas. It didn’t matter how much it was going to be. I had to get gas," said Chad Levens, who commutes 35 minutes...

I think this answers the question for us.  However, these same news reports are all practically begging people to report any prices that they think are "unfair" to the State Attorney General.

I highly recommend the following 5 minute video for people who aren't convinced about how bad these laws are: Is price Gouging Immoral? Should it Be Illegal?


Below is my brief overview of the three common cases where people scream "Gouging!", and  my thoughts, reiterating some of the above notions, and covering two additional cases.
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"Gouging" to ordinary folks seems to mean "they raised the price, and that is unfair". There are three common cases I can think of where gouging occurs:

1) There is a sudden reduction in supply, which can mean an increase in costs or reduction in availability (in this case, pipeline goes down). There is less gas. What should we do? If we gold the price down we won't have more gas, what we do have will be wasted, and we will quickly run out. If we allow prices to rise, people will conserve, people who need it desperately (ambulances, fire trucks, people going to work) will be able to purchase it. And, there is an incentive for people to bring more in using trucks, etc.

2) There is a sudden increase in the need for something- for example, normally I don't need a generator, but after a hurricane I want one more and am willing to pay more. But, so does everyone, and there are only so many generators around. If we hold the price down, people who get there first will get the hotel rooms/generators. If we allow the price to rise, people who desperately need them (e.g. your son needs one to power some medical device) will be able to find one, people who have an extra might be willing to sell one, and people will be willing to drive 500 miles to buy some and truck them in. The same can be said for ice, bottled water, etc. The choice is between having shortages at the normal price, and having more and used more wisely at a higher price.

In the above two cases, allowing the price to rise actually helps things work more smoothly. Some price gouging laws give businesses a defense in the first case, but never in the second.  In both cases, keeping the price low helps a few random people that can find the scarce good at the low price, but at the expense of people who might have a greater need, and at the expense of actually getting more of the product brought in.

3) The third case is one where I have more sympathy with people, since raising prices doesn't clearly have any immediate effect of conserving or encouraging people to supply more. This is the recent case of drug manufacturers such as Epi Pen (increased from $100 to over $600) or Daraprim (went from $13.50 to $750). While I DO support drug manufacturers' right to price high for new drugs (because there is a lot of expense and risk with developing and selling them), Epi Pens should be generic now, save for a stupid trick the FDA allows drug makers to use to extend patent life (though there IS a generic version, click here for more info), and Daraprim is generic, but there is only one plant approved by the FDA to make it.


In this Case 3, I would rather we go after the FDA than the businesses, though yes, they disgust me. However, "disgusting me", in my opinion, is not a reason to put someone in jail or put them out of business. It is the FDA's rules that allow the patent to continue in the first case, and prevent other companies from producing the drug in the second. If the Daraprim case is one where having a monopoly makes sense (due to efficiencies of scale), then economists would argue that this is a case of a natural monopoly that should be regulated (similar to how electric utilities are regulated).

End of Semester Grading Issues: Let Core Values Lead the Way

May... that time of year when Spring has definitely sprung, you really have to get get moving on that end of semester paperwork, and the time when students start coming out of the woodwork to beg for mercy, ask for gifts, and demand satisfaction.

This blog post is in response to the many requests I hear from faculty, young and old alike, to get some help on how to handle all of these end of semester inquiries from students. They generally come in three flavors:

A) Students who have missed assignments or tests during the semester wanting you to let them make them up now.
B) Students who "need an A" or "need a C", and need to know "if there is anything I can do to get a few more points", or even better, "I need to know what you are going to do about it".
C) The most pernicious kind are students who like to nit-pick every grade throughout the semester, trying to get a couple of points here and there on every assignment.

While there is no perfect solution to these problems, first and foremost I recommend that faculty sit down by themselves and clarify their own values when it comes to teaching, grading, and education in general. Firm stances and decisions become much easier when you clearly understand your own principles. This translates into other parts of the teaching and research enterprise as well, such as being treated with respect in the classroom, dealing with academic dishonesty, publication ethics, and evaluation of your peers.  "What is wrong with eating in the classroom?" Don't make up an answer; either there is a real problem, or there isn't, and you should know instantly based on your own values.

Let me share some of my principles that ground my decisions.  Of course, your principles can and should be different based on your institution, personality, and values!

1) Learning: Anything that could possibly get in the way of learning, or could serve as an excuse for not learning, cannot be tolerated.
2) Fairness: All students must be held to the same standards of work, grading, opportunity, timeliness, and of learning the information. Lying or cheating in any form must be stamped out. Others' requests/demands also need to be fair to me.
3) Responsibility: Part of the education process is encouraging and measuring the ability of students to show up, follow instructions, and meet deadlines.  Never harm your students by allowing them to get away with something that would get them fired in the "real world".
4) Difficulty: Students are here to be encouraged, but also challenged: Making students uncomfortable is part of a teacher's duty.  Faculty should (as best they can) provide the tools that students need in order to succeed; it is the responsibility of students to pick the tools up and use them.
5) Who I am: I am a highly-trained professional who cares about what I do, knows what I am doing, but will readily admit to my mistakes. 

These principles are part of my core values-- therefore, making decisions that are consistent with them is not only easy, but necessary.  What are some things that directly follow from these principles related to grading?

A) No, I cannot let you turn in those assignments late; that is not fair to the other students who did them on time. The purpose of doing the assignments when they were due was to help you learn the information before the tests. There is no reason for you to do those assignments now, and several reasons why I should not accept them now. In addition to being unfair, turning the assignments in on time (responsibility) is a purposeful part of the grading process.

B) No, I cannot give you a chance for extra credit or give you "a couple of points". Your need of a certain grade is not a part of the grading process. The grading process is the same for all students- think of how unfair it would be if I gave someone else points.

C) Regarding students who constantly like to question every grade on every question: When I get these, I require that the student write down all of queries/requests for re-grading. I will never engage one of these students in an endless fishing expedition. I also make it clear from the outset that if a student wants an assignment re-graded, that there are strict time limits for bringing it to my attention, and that the entire assignment will be reevaluated, and the grade may go up or down. How can I justify this?  Responsibility and Fairness! All of the other students were graded by me, alone, while evaluating the entire assignment-- not piecemeal, while being hounded, with additional explanations being given, e.g. "See here, you can tell what I really meant, right?" And, nit-picking your yearly evaluation from your superior in the real world is not going to go well for them.

I could certainly go on, but I think you get the point. I must stress that your values, and thus your responses to these situations can, and should be different. But, allowing your core principles to guide your decisions is far superior to making things up as you go along.  Additionally, you are not making these decisions "Because you don't care", quite the opposite: You are making these decisions because you care deeply about what you are doing.  Perhaps letting students in on some of your principles will head off some future problems.

Duke Energy's Time of Use Rate Program

What is a conplagent cost? Answer: It is a cost where you have spent more money than the real price.

I will never stand by while someone lies and distorts information. While I think Duke Energy is a fine company in general, the misleading communication here is horrible. In the interest of saving people the time to see through Duke Energy's misrepresentations about their new "Pilot Program" with different rates for different times, let me cut to the chase for you.  Is it a good idea?  Absolutely not.

Well, theoretically, it is a fine idea that has been discussed by economists for decades.  The details are a big problem here, though, especially how Duke is presenting the program. I emailed them about this previously, begging them to change the language. Hearing no response, here we go.

After getting an email about the program, that encourages people to use less during peak hours (Say, hot  afternoons during the summer), they say (link)
"A slightly higher rate is in effect during six hours each weekday – noon to 6 p.m. during the cooling season (June- September), and 7 a.m. to 1 p.m. during the heating season (October-May). A much lower rate applies all other hours, including every hour of every weekend and holiday."

Now, that sounds great, but is a lie.  This description of the program DOES NOT make sense with economic theory.  Given that in NC we pay a rate a little over marginal cost to pay for fixed costs (including profit), to make this program effective the higher rate needs to be MUCH higher, and the lower rate slightly lower-- to reflect the high marginal cost of using peak generators. After much clicking I found the rates they are talking about.  The "slightly higher rates" are 42-58% higher, and the "much lower rates" are only 24.9% lower (link). So, while these price differences seem reasonable, their advertising is deceptive, and there is very little reason for people to voluntarily subject themselves to this program. They also tack on some other fees as a part of being in the program, a fixed fee per month and a $1.84 per kW "distribution demand charge" which is not adequately explained.  They also tell you that they estimate that you could save a WHOPPING $30 per year on your electric bill.  Keep in mind that your bill could also skyrocket under this plan.  Raising people's rates almost 60% during the summer afternoons could really cost a lot-- so very carefully consider the risk you are taking for a possible $30 per year savings.

What is a conplagent cost? Answer: It is a cost where you have spent more money than the real price.

Scam Warning: $3,990 check from "North Atlanta Survey"

I just got a letter in the mail with a fake check, asking me to call 877-319-1166. This is a slight twist on some standard scams- but the details are so new that I felt the need to write a quick alert for people.  This is a slight twist on earlier "Secret Store Evaluator" scams. They claim to want you as a "Trainee Independent Private Evaluator".  The English usage is decent for a scam, but there are quite a few typos.

The letter was a plain white envelope with the return address 4434 Peachtree Rd. NE, Atlanta, GA 30326.  As far as I can tell, this is the wrong Zip code for this address, and this address at one time was for a law firm. The letter says it is from North Atlanta Survey INC, P.O. Box 5490, Atlanta, GA 30067.

The letter encloses a real looking check for $3,990.  As with all of these scams, they want you to deposit the fake check.  See the check below with the name and address of owner of the  Frank's Deli chain, which makes no sense: Deli Management, Inc., even though the letter says North Atlanta Survey (which doesn't exist, as far as I can tell). In the check I removed a few numbers from the account number (just in case this is a real, but stolen account number), and my name and address, etc.

Then, the instructions say to call 877-319-1166, EXT 1. I called, and a computerized voice does answer "North Atlanta Survey". You are supposed to Spend $50 at Walmart, $50 at Walgreen, and buy $3,000 worth of "Green-Dot Money Pack Reload" (6 transactions of $500 each).  This is where they steal your money. In other Green-Dot related scams, they ask you to tell them the Green-Dot account number, and as soon as you do, they steal the money. If you believe the story they are telling you, of course you would give them the numbers, since it really is their money anyway. Then, 2 weeks later your bank figures out that the check was a fraud, and YOU will be arrested for fraud.  Really- it happened to a student of mine once-- the bank doesn't know or care that you didn't create the fake check!

Here is the first paragraph, so if people are searching the internet for keywords, hopefully they will see this: 

"I am pleased to inform you that you have been selected to become one of our Secret Store Evaluators assigned to Wai-Mart, WalGreen and Green-Dot. This is a THREE MONTH probationary assignment that you are required to complete within 24hrs of activating your check. This is a paid Training assignment that takes about 2hrs to complete. You will be paid $430/hr for the training. Your assignment is to be carried out and completed at any Wal-mart, CVS, Wal-Green and Green-Dot Money Pack Reload locations. The objective of the assignment is to evaluate the effectiveness of Green-Dot Money Pack Reload system and to evaluate the level of customer service provided by WalGreen, CVS and Wal-Mart 

your job descriptions would be to secretly go into any Wal-mart, CVS and WalGreen stores to purchase items and evaluate the efficiency and effectiveness of the customer service level of the particular store. Whatever you buy belongs to you but you must fax the receipts and the completed evaluation form ."

Just think of the inconsistencies: It is a THREE MONTH assignment lasting 24 hours. Who in the world pays $430/hour for training, or anything else? If they want to test to see how Green-Dot works at stores, why do the transactions need to be for $500 each?  Why not $20 each? 

Here are some sites warning of these kind of scams:

http://www.ci.yuma.az.us/news/29075.htm

http://www.today.com/money/scammers-now-accepting-green-dot-moneypaks-1C8721925?franchiseSlug=todaymoneymain

http://www.ripoffreport.com/r/Mystery-Shopper-Providers-Association-MSPA/internet/Mystery-Shopper-Providers-Association-MSPA-Denise-Burton-MSPA-is-a-SCAM-I-just-recieved-992833

Be safe out there guys! NO ONE would ever mail anyone a check for no reason!  This just makes no sense, when you think about it. Never accept money that is then supposed to be sent on to someone else-- it is the classic ebay, employment, sweepstakes, and now secret shopper SCAM!

The Latest Social Security Internet Hoax Letter

Each month we all get forwarded several emails from people, who diligently forward emails saying "FORWARD THIS TO EVERYONE!" These normally are designed to scare people with hoaxes or less-than-truthful political commentary.  Below is one I just received about the US Social Security system, and I decided to take a few minutes to provide some commentary on the dozens of mistakes contained in the email.  Snopes.com covered this, but didn't do a detailed job on it, so, here I go to try to fill in some gaps and do a few calculations, providing references for people wanting to look at the numbers themselves. The original email is in Italics, and my text is non-italicized.
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KEEP PASSING THIS AROUND UNTIL EVERY ONE HAS HAD THE OPPORTUNITY TO READ IT... THIS IS SURE SOMETHING TO THINK ABOUT!!!! THE ONLY THING WRONG WITH THE GOVERNMENT'S CALCULATION OF AVAILABLE SOCIAL SECURITY IS THEY FORGOT TO FIGURE IN THE PEOPLE WHO DIED BEFORE THEY EVER COLLECTED A SOCIAL SECURITY CHECK!!! WHERE DID THAT MONEY GO?
It is unclear what "available Social Security" means here, or what government calculation this might be referring to. In any case, people who die are factored in to the actuarial calculations.  Where that money "goes" is to other beneficiaries. Social Security was never designed as a retirement investment account, but a social insurance program in reaction to so many old people in poverty in the 1930's. The current correct name is "Old Age, Survivors, and Disability Insurance" program (OASDI, for short). What you are paying is a TAX, not a deposit, though you could properly think about it as paying a non-voluntary insurance premium (like ObamaCare? ☺). If someone dies, then their survivors get benefits (spouse, children under 18 or 19 depending on details, and disabled children over 18).  Also, many disabled people get OASDI-- around 5% of the US population aged 19-64 right now is on this disability program!(citation). Right now (2013) almost 63 million people are getting OASDI benefits (source), compared with 142 million who are actually working (source). That means that there are only two people with jobs paying for each person getting benefits. THERE is what you should be e-mailing everyone about!

Remember, not only did you and I contribute to Social Security but your employer did, too. It totaled 15% of your income before taxes. If you averaged only $30K over your working life, that's close to $220,500. Read that again.
Here we are making the unreasonable assumption that the average person works for 49 years straight (from 16 to 65). The average person spends a lot of this time in school, unemployed, taking care of children, or disabled, and not working and paying in benefits.

Did you see where the Government paid in one single penny? 
That is just silly- the Government has no money except for tax money from workers (and borrowing, future tax money).

We are talking about the money you and your employer put in a Government bank to insure you and I that we would have a retirement check from the money we put in, not the Government.
This money does not get put into a government bank. The system has always been self-funded-- enacted in 1935, it began paying benefits in 1937 as money was just being raised in taxes to pay these benefits. There has never been a pool of money sitting there that people paid in (until the last few decades, when they purposefully started taking in more than they paid out to prepare for the Baby Boomers' retirement.  This money was invested in government bonds-- more on that in a minute.)

Now they are calling the money we put in an entitlement when we reach the age to take it back. If you calculate the future invested value of $4,500 per year (yours & your employer's contribution) at a simple 5% interest (less than what the Government pays on the money that it borrows), after 49 years of working you'd have $892,919.98.
5% is not less than the government pays on money it borrows-- as we all know, interest rates are very low, and the average rate paid right now on all US debt is 2.5% (source). Using this rate, your hypothetical total would be $423,589.82.  However, this number is meaningless-- if you want to start saving $4500 per year when you are 16 so you can end up with $423K at 65, I encourage it!  But the government is not your bank, or your IRA.  Plus, you have to take into account inflation.  People retiring now who are making $30,000 were not making $30,000  in 1964 when they were 16 years old. US Per capita income was $3,423 back then (source), so you weren't paying in the $4,500 per year you are assuming, especially given that the tax rate was only 3.625% then (source), unlike the 7.65% now (double it for the employer match, of course).  So, you didn't pay in nearly as much as you think.

Let's take someone who did work every year, and made the Per Capita Income in every year from 1964-2013 (from 3,423 to $50,000), 50 years of work, and they and their employer paid in the OASDI rate at the time.  With no interest at all, you'd have paid in $169,317.50 if you worked every year constantly from age 15 through 65, earning exactly the per capita income.  Suppose we did deposit this money in a bank every year, and earned 5% on it, beginning with the $248.17 we saved in 1964, and so on.  We would end up with $397,843.10 at the end of 2013. So, $400,000 is probably an overly generous figure, since most people do not work from age 15 to 65 with no breaks, and earning 5% constantly won't happen for most people. (My spreadsheet numbers are at the bottom of this blog post, so you can look at them to see what is going on, if you wish).

If you took out only 3% per year, you'd receive $26,787.60 per year and it would last better than 30 years (until you're 95 if you retire at age 65) and that's with no interest paid on that final amount on deposit!
Nothing is "on deposit", as mentioned previously. Using the more realistic number of $400,000, 3% would be $12,000 per year.

If you bought an annuity and it paid 4% per year, you'd have a lifetime income of $2,976.40 per month. 
$1,333.33 per month.

Another thing with me.... I have two deceased husbands who died in their 50's, (one was 51 and the other one was 59 before one percent of their social security could be drawn. I worked all my life and am drawing 100% on my own social security). Their S.S. money will never have one cent drawn from what they paid into S.S. all their lives.
If this person has two dead husbands, then she is eligible for survivor benefits as early as age 60.  Click HERE for more information.

THE FOLKS IN WASHINGTON HAVE PULLED OFF A BIGGER PONZI SCHEME THAN BERNIE MADOFF EVER DID. Entitlement my foot, I paid cash for my social security insurance! Just because they borrowed the money for other government spending, doesn't make my benefits some kind of charity or handout!!
My red highlighting here-- see, is it insurance, and not a savings account!  The word "entitlement" simply means a guaranteed benefit by law.  It does not mean "handout" or "charity".

Remember Congressional benefits? --- free healthcare, outrageous retirement packages, 67 paid holidays, three weeks paid vacation, unlimited paid sick days. Now that's welfare, and they have the nerve to call my social security retirement payments entitlements?
I actually take the unpopular opinion that congressmen are underpaid, for someone to quit their job, and keep one house back home and a house (apartment, whatever) in Washington, DC.  They certainly don't get paid enough for ME to consider running, think of the huge sacrifices these people make. Even people without skeletons in their closets sometimes have their lives ruined by lies made up by their campaign opponents.  That doesn't mean that I LIKE politicians or anything, far from it.  But, if you want the best and brightest to run the country, how about offering enough to attract them (like some qualified accountants!)?  What do these "paid holidays" and "paid vacation" mean? It just isn't true. These guys must constantly campaign, network, and deal with constituents.  Just because you aren't on the floor of the House doesn't mean you aren't working-- but even if you aren't-- don't people deserve to go home, possibly 3,000 miles away, to see their families and constituents?

We're "broke" and we can't help our own Seniors, Veterans, Orphans, or Homeless. They call Social Security and Medicare an entitlement even though most of us have been paying for it all our working lives, and now, when it's time for us to collect, the government is running out of money.
The word "entitlement" simple means a guaranteed benefit by law.  It does not mean "handout" or "charity".  In any case, what is the rant about?  The government is running out of money, so... what? They are still paying your benefits, and will continue to do so.

Why did the government borrow from it in the first place? It was supposed to be in a locked box, not part of the general fund.
Well, it isn't part of the general fund. Most of the money is spent on benefits to current retirees-- there is just no other way to do it when a program starts paying money to people when the program starts, without having a pool of money that these people paid in.  Plus, it IS insurance-- remember those disabled people? They are around 25% of the total-- these people might pay in just a couple of years, and get benefits from age 25 through 95.  Extra money, called the "Social Security Surplus" is invested in government bonds and held in the Trust Fund (source), which today has almost $3 Trillion in it. Given the steep increase in people claiming disability, this isn't a whole lot of money, but it is about $50,000 per current beneficiary to put it into perspective.

Sad isn't it.  99% of people won't have the guts to forward this. I'm in the 1% -- I just did. 
99% of people aren't brave enough to try to correct the mistakes.  I just did!

Now, let me say again for those that didn't hear it the first time-- None of this means that I love politicians, trust the government, or think that Social Security doesn't have problems. It is just that nothing in this email relates to any of those problems. The real problem is too few people paying in compared to too many people taking out. SIMPLE to understand. Some people are paying in for under 30 years, then expecting benefit from age 65 to 95, getting out more than triple what they paid in. Let me briefly describe a REAL problem that you probably haven't thought about-- how unfair this system is to Black Men (BM) compared to White Women (WW).

Suppose that a BM and WW worked at the same job, got the same pay, for the same years. Whereas 87% of women make it to age 65, only 64% of black men do.  Doesn't that seem a bit unfair?  How about we suppose that 100 BM and WW made it to 65 and then retired.  Well, after 13 years half of the BM would be dead, but only 27% of the WW would be.  And yet, we pay the same monthly benefit to both people, even though we know that the WW will be paid MUCH MORE in benefits than the BM over their lifetimes (or White Males, for that matter).  At age 85, 25 of these 100 BM would still be alive, compared with 47 of the WW. Shouldn't benefits be paid out more fairly?  I leave it up to you.  (Calculations based on the CDC Life Tables)

See my videos on "Death Probabilities" for more information on these kinds of calculations:
Video 1
Video 2

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Spreadsheet of calculations is below, for your reference.

Year	Nominal PCI	FICA Rate	"Saved"	In "Account" at 5%
1964	$3,423	3.625	248.17	248.17
1965	$3,665	3.625	265.71	526.29
1966	$3,972	4.2	333.65	886.25
1967	$4,152	4.4	365.38	1295.94
1968	$4,491	4.4	395.21	1755.94
1969	$4,803	4.8	461.09	2304.83
1970	$4,998	4.8	479.81	2899.88
1971	$5,360	5.2	557.44	3602.31
1972	$5,836	5.2	606.94	4389.37
1973	$6,462	5.85	756.05	5364.90
1974	$6,948	5.85	812.92	6446.06
1975	$7,517	5.85	879.49	7647.85
1976	$8,297	5.85	970.75	9000.99
1977	$9,143	5.85	1069.73	10520.77
1978	$10,225	6.05	1237.23	12284.03
1979	$11,302	6.13	1385.63	14283.86
1980	$12,180	6.13	1493.27	16491.32
1981	$13,526	6.65	1798.96	19114.85
1982	$13,933	6.7	1867.02	21937.61
1983	$15,000	6.7	2010.00	25044.49
1984	$16,539	6.7	2216.23	28512.94
1985	$17,589	7.05	2480.05	32418.64
1986	$18,427	7.15	2635.06	36674.63
1987	$19,394	7.15	2773.34	41281.70
1988	$20,703	7.51	3109.59	46455.38
1989	$22,039	7.51	3310.26	52088.40
1990	$23,038	7.65	3524.81	58217.64
1991	$23,443	7.65	3586.78	64715.30
1992	$24,411	7.65	3734.88	71685.95
1993	$25,327	7.65	3875.03	79145.28
1994	$26,578	7.65	4066.43	87168.97
1995	$27,559	7.65	4216.53	95743.95
1996	$28,772	7.65	4402.12	104933.26
1997	$30,282	7.65	4633.15	114813.07
1998	$31,687	7.65	4848.11	125401.84
1999	$33,332	7.65	5099.80	136771.73
2000	$35,082	7.65	5367.55	148977.86
2001	$35,912	7.65	5494.54	161921.29
2002	$36,819	7.65	5633.31	175650.66
2003	$38,225	7.65	5848.43	190281.62
2004	$40,292	7.65	6164.68	205960.37
2005	$42,516	7.65	6504.95	222763.34
2006	$44,623	7.65	6827.32	240728.82
2007	$46,349	7.65	7091.40	259856.66
2008	$46,760	7.65	7154.28	280003.78
2009	$45,305	7.65	6931.67	300935.63
2010	$46,612	7.65	7131.64	323114.05
2011	$48,112	7.65	7361.14	346630.89
2012	$50,000	7.65	7650.00	371612.43
2013	$50,000	7.65	7650.00	397843.05
		Total	169317.464
The last two PCI are 50,000 by assumption-- 2013 isn't over yet,
and I just chose a simple, reasonable number.