On ‘saving’ Social Security, Obama and McCain do more than just ‘diverge’

July 8, 2008

John McCain has been struggling with Social Security for a while now. He was, for example, in favor of privatizing the system, only to reverse course soon after and oppose privatizing the system, only to discover that his new position was actually the same as his old one.

Yesterday, the McCain campaign complicated matters, issuing its “plan” to eliminate a $410 billion deficit in four years, in part by cutting Social Security benefits and privatizing the system.

Given this, the Washington Post reported on its front page today: “Candidates Diverge on How to Save Social Security.”

Sens. Barack Obama and John McCain are both proposing dramatic changes to Social Security, taking on the financially fragile “third rail of American politics” that Congress and recent presidents have been unable to repair.

McCain’s aides said he favors a bipartisan approach and is open to working with Congress on finding a solution to the long-term solvency of the New Deal-era program, indicating he could support an array of ideas such as raising the retirement age, reducing scheduled increases in benefits and allowing younger workers to put money they currently pay for Social Security taxes into personal savings accounts. President Bush floated a similar idea for private accounts in 2005, but polls found it had little public support.

Obama has been even more specific. The Democrat from Illinois has proposed raising taxes on upper-income Americans to address projected shortfalls in Social Security, but his plan has been greeted with skepticism, even from some in his own party.

The piece couldn’t be any less helpful. It’s just horrible reporting that offers readers nothing in the way of real information.

The headline, for example, is wrong. Both candidates don’t want to “save” Social Security; one wants to privatize it. Note to Post headline writers: “Abolishing” and “saving” are not synonyms.

And the lede is wrong. Both candidates aren’t proposing “dramatic changes” to the system; one wants to the leave the system largely as-is, except for altering the payroll tax cap. There’s nothing dramatic about it.

And the entire second paragraph is wrong. McCain’s privatization plan is not a “bipartisan approach”; it’s a conservative Republican approach pushed aggressively by the Bush White House, which failed miserably.

And characterizing the Social Security system as “financially fragile” and in need of “repair” is wrong. As Yglesias noted:

[T]here’s also the fact that the projected deficits for Social Security are smaller and more manageable than those projected for the other entitlement programs (Medicare and Medicaid) and that the non-entitlement portion of the budget is running a huge deficit right now. Under the circumstances, Social Security would seem to be the least financial fragile aspect of the federal budget. And one more thing — to say “that Congress and recent presidents have been unable to repair” Social Security implies that recent presidents and Congresses have been trying to repair it when, in fact, George W. Bush’s Social Security proposals were, like John McCain’s, aimed at phasing the program out.

I’d just add the same Post article notes that McCain “could support … reducing scheduled increases in benefits.” What that leaves out is context and details. McCain, yesterday, talking about targeting Social Security in the context of eliminating a $410 billion deficit in four years. In other words, a McCain administration will have to spend less on Social Security to balance the budget and pay for for hundreds of billions of dollars in tax cuts.

Just how much less? Hilzoy does the math:

During FY 2009, Social Security will pay $688 billion in benefits. McCain has $675 billion a year to make up.. Supposing he finds, oh, $20 billion a year in unspecified “wasteful spending”, and that this money doesn’t go to pay for, say, the new weapons systems that McCain has proposed, and that I haven’t calculated in: in that case, he would still need to cut Social Security benefits by $655 billion a year, or over 95%.

And that, of course, isn’t going to happen, which is why McCain’s “plan” is ridiculous.

So, why aren’t we seeing a bunch of headlines this morning, saying, “McCain proposes privatizing, cutting Social Security”? Because reality has a well-known liberal bias.

Obama himself has added to this confusion by characterizing the system as in need of repair. That characterization leads people to distrust his intentions. Yes, he now says he would only tweak it by raising the cap on earnings, but why would he imply that the system is in trouble if he has no other intentions for reforming it? How will he deal with the plundering of social security reserves by the Bush admin? Older voters, who are not big Obama supporters, need to know these things. It isn’t enough to claim that McCain will dismantle the system — what are Obama’s intentions?

On another topic — here is a quote from TPM talking about the upcoming Democratic Convention:

“Will Barack Obama be nominated unanimously, or will Hillary Clinton’s name be put to a vote in order to not alienate her supporters? “There’s nothing symbolically wrong to putting her name in,” said Donna Brazile, but the danger is that an overly-enthusiastic reception would make Obama look like he hadn’t unified the party.”

What is wrong with this picture? If Obama is worried that placing Clinton’s name in nomination would receive too much support and thus make it appear he hasn’t unified the party, he clearly hasn’t unified the party. If he had unified the party, this wouldn’t be a concern. Why hasn’t Obama unified the party? Is he capable of unifying the party? I don’t think so. Messing with social security isn’t going to help unify the party — since many older voters were for Clinton in part because of his statements about social security (among many other positions). Photo ops at Unity NH won’t unify the party if Obama is uninterested in taking positions that will bring in Clinton voters — because he is too interested chasing conservatives, independents, the religious right, and similar “new” voters. In other words, instead of unifying the party, he is taking the so-called Clinton voters for granted, which will lead to problems at the convention and in the Fall. Maybe he hopes to drown their voices out by packing a sports stadium with his own supporters — another version of the shouting down of dissent that occurs here in miniature.

  • look, i’m pretty cynical about the journalist class, but honest-to-goodness, we had a giant national tutorial just a few years ago and there is no financial problem with social security that needs “saving.”

    the idea that this hasn’t penetrated the brains of the typing class is, in certain ways, as devastating a critique of the fundamental mindlessness of this cohort as anything i can imagine.

  • The Reagan administration assured me back in the 80’s that SS had been saved by increasing my witholding taxes then to build up a surplus that would pay my benefits later. If McCain or anyone else wants to not honor that commitment, then someone owes me a lot of overcharged back taxes.

  • More from Jobs for America

    Reform Social Security: John McCain will fight to save the future of Social Security, and he believes that we may meet our obligations to the retirees of today and the future without raising taxes. John McCain supports supplementing the current Social Security system with personal accounts – but not as a substitute for addressing benefit promises that cannot be kept. John McCain will reach across the aisle to address these challenges, but if the Democrats do not act, he will. No problem is in more need of honesty than the looming financial challenges of entitlement programs. Americans have the right to know the truth and John McCain will not leave office without fixing the problems that threatens our future prosperity and power.

    This is his plan, a promise to have a plan iff the dems don’t have one. This is even more jejune than the other “plans” he claims to have, but doesn’t seem to find it necessary to divulge (probably because no one in the media will ask him).

  • One wonders why some smart economist like paul Krugman hasn’t done a chart showing how much money it would cost the US Government if the privatization of SS doesn’t succeed and all of those older folks have to be placed into Welfare…

  • As Dean Baker has been pointing out it seems forever: Social Security is solvent through at least 2046 with absolutely NO changes. A small tweak (much smaller than Reagan’s SS tax) would make it solvent into infinity paying greater benefits than now.

    The Repubs and their press friends have the American public believing in flying saucers. Just another right wing lie that needs to be relentlessly hammered down.

  • Yesterday I noticed an article that said the WaPo was hiring a new chief editor, who used to be the chief editor of the WSJ. Knowing the editorial policy of the WSJ, what do you expect from WaPo now, integrity?

  • Martin -#9
    But if they just change the tax rate and fix the incredibly tiny problem, how will our corporate masters be able to make a profit from this government program?

  • Quoting Martin above: “The Repubs and their press friends have the American public believing in flying saucers. Just another right wing lie that needs to be relentlessly hammered down.”

    We all know this — why doesn’t Obama? Back during the primary, Obama talked about the need to fix social security, repeating this Republican meme as a campaign issue to differentiate himself from Clinton (who got it right). Where was the outrage then? Where is it now? Your own candidate is spreading this myth — not just McCain. And you wonder why the older voters don’t like Obama!

  • This is insane. It is pavlovian. private accounts when the market is tanking? Look, it made cynical political sense when the go-go 90s dot-com boom was booming and not busting, but now?

    I look for gay marriage to be the big “wedge” issue for the Repubs and this should be the “wedge” issue for the Dems. I know it wont, but it should be.

    The real tactical issue i see is looming is how McCain’s handlers present the straight talk express as an incompentent speaker to lower expectations for the debates. Granted they are not Obama’s strong suit, but were it not for 43, McCain would be considered a train wreck, instead of a mere trolley accident. Now they will say, backed by the Matthews-crowd, that straight talk does not translate to a debate, but were i Obama i would do 100 town hall debates with McCain and make the McCain people say it is too many. I know people say the leader should not do debates, but I think there is no underestimating the rank obsequiousness of the MSM as it applies to McCain. The way to beat him is to get rid of the filter.

    Oh, and fight like heck.

    eric

  • Mary said:
    … Back during the primary, Obama talked about the need to fix social security, repeating this Republican meme as a campaign issue to differentiate himself from Clinton (who got it right). Where was the outrage then? Where is it now?

    Mary, do you get your car tuned up regularly and change the oil when recommended, or do you just keep driving until it doesn’t run anymore?

    By the way Mary, you never answered the question I asked yesterday:
    http://www.thecarpetbaggerreport.com/archives/16109.html#more-16109 – comment #12

    Why should we believe that Sen. Clinton would have been more progressive-friendly than Sen. Obama, given Clinton’s DLC pro-corporate history?

    And what was Clinton’s plan for Social Security?

  • I have a question about privatizing Social Security that I never saw raised by the corporate-controlled media when Bush was pushing the issue. In fact, I’m not even sure where to find the numbers.

    During the Dot-com bubble I thought about getting in on some initial stock offerings. But a lot of people were jumping on the bandwagon and driving up tech stock prices ‘way beyond what they could ever be worth — hence the “bubble”.

    So what would happen to stock market if people were able to take their Social Security funds and create their own private accounts, and suddenly 100 million people are all trying to buy stock at once?

  • For anyone in generation X,Y, or born after the baby boomers social security is just another tax. More importantly, the focus should be on medicare/medicaid, those programs are the ones that are in serious trouble now. Our generation is going to be screwed in more ways than one. Thanks alot. Can’t wait to proudly explain how we screwed up to my future grandchildren.

  • It is scary to see so many people defend Social Security. I can get three times the return on my money in a federally insured bank savings account. I can do much better than that in a very safe mutual fund. I believe the rest of generationX would agree that we will take care of the old folks and future recipients. However, to enslave me to a system that gives me crappy returns and won’t be there when I retire is idiotic. Wake up and get educated. This cannot continue.

  • As much I have problem with Mary’s reflexive Obama bashing, I do believe in this instance that she is correct. Although I have no problem with Obama’s proposal itself, his framing of the issue gives fodder to the rightwing. Obama needs to be careful in the way he responds to McCain’s proposal because it could be a trap.

  • Mary,

    The system is in need of repair. Obama believes raising the tax cap IS the repair. Sure, he could wind up being wrong, but McCain (the guy you’re going to vote for) IS wrong. Sometimes when things are in need of repair. the repair need not be drastic or difficult to do or even difficult to explain.

    but then, I keep forgetting, you = stupid. See? THAT was easy to explain.

    And if you ever wanrt to stop being a complete coward and answer my question – What does Obama have to do…FOR YOU…to prove his patriotism – Im’ sure we’ll all be curious as to your answer. Again, I think he could teach boy scouts all the verses of The Star Spangled Banner in sign language while nursing orphaned bald eagles and building a commemorative statue of Abraham Lincoln to adorn a city park he footed the bill for landscaping, and you’d still think he wasn’t patriotic enough. Sorry, that skin color of his can be a burden, I know, but really, what can he do…FOR YOU…to prove his patriotism? Stop being a chicken-shit. There must be SOMETHING.

  • Oh, and I forgot to mention. Neither the Dems or Republicans can touch my savings and mutual funds for their pet projects and worthless government programs. Unless, of course you are one of these wizards who want higher taxes on my retirement earnings.

  • slappy magoo,

    A suggestion, go out and get a job. Once you get a paycheck, which it seems by your comments you have never received, and see how much is taken out in taxes. It is not about Obama’s patriotism. It is about his idiotic and naive spending plans and increased taxes.

  • Micheline, I do appreciate your comment on SS being a rainy day fund. I agree that it needs to be there for people who truly need it. However, in its current form and returns, it is forcing us in to a system that will guarantee poverty in retirement for the vast majority of us. If we had the option to invest this money privately, even with modest returns, we would be able to fund a better system for all.

  • If we had the option to invest this money privately, even with modest returns, we would be able to fund a better system for all.

    And if we had wings, we would fly.

    Raising the cap and cutting benefits for those that don’t need it ‘fixes’ it – and we would do well to recognize that Medicare is the real ‘problem’ that is going to require serious political and economic consideration.

  • SteveT — I have on several occasions listed the issues where I believe that Clinton had better positions, where Obama was much worse. I took a great deal of time explaining all this back when I thought people were asking because they wanted to know. I am not going to waste that effort now.

    Clinton’s position on social security was that it was not broken and didn’t need fixing. Her position was that raising the cap as necessary to make sure the funds equaled the projected demand was all that was needed. Yes, Obama is now only talking about raising the cap, but he came out during the primary talking about fixing a broken system. The press made a big fuss about that and he didn’t back off his position that the system needed repair. He did that in order to make himself appear different from Clinton. That he is now borrowing her programs doesn’t make him the right guy to be president. It makes him dishonest.

    I disagree that social security is a rainy day fund. It is a pension system because it is all a majority of elderly adults have when they retire. Today’s stock market and home price declines should show you the problem with investing in 401(k)’s and personal savings or home equity. In a troubled economy with rising health care costs, elderly people who get sick see their savings evaporate quickly. The only thing they can count on in old age is the money that cannot be touched, their pension and social security. Given that pensions no longer exist for most workers, social security is all there is left. Older women have less than older men (because of the pay differentials during their working lives) but they live longer. Without social security these women would be in bigger trouble. As it is, they are a large percentage of those living in poverty. That’s one reason why they support Clinton over Obama. They know what social security means to their current and future survival. Many younger people consider retirement optional and assume that those without money can just go on working. Unfortunately, health forces some people to retire before they had planned. The economy forces others to retire when they can no longer find work. Involuntary retirement or underemployment force people onto their savings and social security whether they wish to be or not. Many younger people assume that families will care for the elderly. Unfortunately, families are struggling too and may not have the resources to support themselves and elderly parents. This is a real problem that requirements a real solution — not demagoguery, by Obama or McCain. Clinton took this seriously. Obama clearly did not.

  • Mike, you are saying the same crap Republicans have been saying for 75 years. It wasn’t true 75, 50, or 25 years ago, why is it true now?
    Your comment @ # 23 is the most blatant lie that you can tell about Social Security, check out the poverty rates for the elderly before and after the institution of this program.
    I’m sure that creeps like you have no shame, but you should be embarassed to be caught in such a blatant lie.
    Go peddle your bile where they are stupid enough to lap up piss & ask for more AKA Free Republic & Little Green Footballs.

  • guyfromohio said “Raising the cap and cutting benefits for those that don’t need it ‘fixes’ it”

    Guy, thanks for the comments but what I want to know is who decides FOR ME if me and my family are one of those who does not need MY MONEY! And are these same people deciding for me how much I need for MY RETIREMENT. Somehow, I think MY MONEY would be better served in a private account and be taxed to take care of the real ‘problems’ like Medicare. Because, the less I have in retirement (because of SS), the more likely I am not going to be able to pay for my private health insurance in retirement and need to line up for Medicare benefits. Does anyone see a connection here?

  • BuzzMon, SS was created during the great depression. Hardly a good before and after comparison. We should not make this about Republican or Democrat. It is what is best for the old people, right. I sense you are missing the big picture with your partisan politics. I can feel the veins popping on your forehead. I will however check out your suggestions for peddling my ‘bile’ was it? Thanks for the laugh.

  • Older voters, who are not big Obama supporters, need to know these things. -Mary

    It isn’t older voters who should be or are concerned about Social Security. Show me a professional under the age of thirty who doesn’t think that, if left untouched, Social Security will have evaporated to nothing by the time they are retiring.

    Without adjustments, such as raising the salary cap and eligible age, they’ll be right, and those old people will be dead and gone, but who cares, right, as long as you get yours and get to slam Obama in the process.

    And Mike, it’s not ‘your money.’ It’s ‘our money,’ just like all other taxes. It’s a redistribution tax. You want to save and invest, go for it, but not with tax money. You, except through your elected representatives, don’t get to decide how tax money is spent.

    Would you make the same argument for income tax, sales tax, or property tax?

  • Mike, if you’re good with money, good for you. SS was created as a means to insure that people who aren’t good with money aren’t going to starve to death for not being good with money when they’re too old to work anymore. It also prevents them from being fucked over if they start losing their mental faculties, still “there” enough to keep themselves going day to day, but not “there” enough to know when they’re getting conned by a get-rich-quick scheme. No matter what happens, they paid into a system, and they’ll get paid by that system. If they get tricked into investing in hover cars, if they think that 23 year old nurses aide married them for love, or if their kids are greedy and just take everything, they’ll still have some money coming in once a month.

    You’re thinking of the issue as a (presumedly) young man with all his mental faculties and in charge of his own destiny. Think about old women who always had their husbands cover finances who are no longer alive (or vice versa). Think about people who did plan ahead for their retirement, but are now hit with crippling medical expenses that no one aside from the wealthiest among us can adequately prepare. Hell, even banks can fail. How much are accounts insured for?

    Sure, you can prepare better for any of those eventualities, maybe even rpepare for ALL of thse eventualities, a perfect storm of a sucky life. But with SS, people don’t have to. It takes a certain degree of fear out of people’s lives (not that there still isn’t plenty to fear). And if you think that’s wrong, then really, we have nothing to say to each other on the matter.

  • Buzzmon, Ouch! Well, I am sure it hurts both of us when we look at our checks.

  • Mike said: “It is scary to see so many people defend Social Security. I can get three times the return on my money in a federally insured bank savings account.”

    I’ve heard that said. But I’ve also heard it said that because people are living longer that they are getting better returns because their benefits never run out (unlike my IRA). Dr. George F. Will likes to mention the first Social Security beneficiary, who paid 25 cents of FICA taxes at age 64 and then was paid social security benefits for the rest of her long life.

    So are beneficiaries getting too little (only 2% return on their money) or too much (benefits for life)?

  • i was going to comment on something else, but first we have the amazing mike and his misunderstanding.

    let’s try to keep this as simple as possible, mike: you don’t compare the rate of return you might achieve with a mutual fund to a so-called rate of return on your payroll taxes.

    what you have to compare is the annuity you could purchase with your mutual fund dollars at age 65 to the annuity that social security actually is.

    and when you do that, you discover that social security is one helluva good deal.

    this is not to say that social security supports a luxurious lifestyle: it is a baseline, and anyone that can supplement it should.

    but that’s a completely different matter.

    let us also note that – as any retirement planner will tell you, and this is why the annuity nature of social security is so critical – the biggest risk in retirement is outliving your savings. if there were no social security to form a baseline, we would all have to save enough to anticipate living past age 100. this would pull an enormous amount of money out of current spending and cause a major economic dislocation, and half of it would be pointless in the sense that half the people won’t live that long. meanwhile, it’s a very suboptimal macroeconomic outcome.

    (by the way, slappy magoo, there is no evidence that mike is “good with money.” there is evidence that mike is a bigmouth who doesn’t understand social security and complains about a non-existent problem.)

    what i really intended to do was respond to dmk, though: the wall street journal editorial page is edited by someone different than the news editor. the wsj is an excellent news source (or at least it was until murdoch bought it); the wsj editorial page is written by people who don’t read their own newspaper.

    i think it’s a huge step up for the wapo to hire this guy (you can’t hardly be more in the tank than len downie), although it may be too late, and the wapo’s reputation may already be shot.

    now, as to why i really planned on posting

  • Mike said: “BuzzMon, SS was created during the great depression.”

    Actually, Otto von Bismark invented Social Security. Hardly the most liberal person in the world. We adopted it in America as part of the New Deal.

    Designed correctly, it works. The problem with the system is that the minimum retirement age is too low right now. On the other hand, the more Boomers who retire the higher wages will be for the rest of us as labor becomes scare, and the higher the FICA revenues for SS and Medicare and Medicaid will be. Also, higher wages will also convince more Boomers to put off early retirement.

    So the system is probably not as bad off as you imagine.

  • Slappy, I agree with you that we need some form of guaranteed social security. However, I think we can achieve better returns and still have this guarantee. The current system is outdated and inefficient. In a lifetime of saving and investing, even during bad times, I believe each one of us, including current retirees, would be better off. There are people who do not make enough money to have personal investments or savings. I would think these hard working people would like the opportunity to retire with even a little bit more. You are right that it could not be a free for all, as much as I would prefer it. It would have to have controls. Maybe a portion to SS, another to ‘safe’ investments. Maybe we could start slow as an experiment with all profits going to the SS general fund for proof of concept. Buzzmon is in payroll maybe he has some good suggestions. 🙂

  • howard and lance, I read your comments with great interest, so please correct me if I am wrong on this question. In our current design, 1. we pay government, 2. government spends money as they see fit, 3. kids pay for our retirement. 4. and so on. Is this correct? By the way, I do OK. I just have 4 kids and too many toys. So, you are right. I am poor.

  • yes, mike, you are wrong.

    we do not “pay” government: as a result of constitutionally ordained powers, our representative government levies taxes upon us to pay for the programs our representative government enacts.

    government does not “spend” money as it sees fit: our representative government goes through a budgeting process and approves a budget and associated set of programs.

    “kids” do not pay for our retirement: social security historically functioned on a pay-as-you-go basis but as of the reagan-era reforms, the baby boom generation is prefunding a further increment to make up for the pig-in-the-python nature of baby boom demographics, and of course it’s “workers” and not “kids” whose taxes are being used in the pay-as-you-go.

    so you’re wrong in all your basic assumptions, which helps explain why your understanding of social security is so flawed.

  • Missing in this discussion about Social Security is the focus on young people. Future generations are the ones who are going to have to bear the burden and pay the price in this pay-as-you-go system. A recent economic survey by the Center for American Progress found that 74 percent of Millenials support personal accounts for the matter of Social Security. Just read Students for Saving Social Security’s press release today: http://www.secureourfuture.org

  • Mike – I feel that we missed the boat back in Reagan’s time when the Boomer premium was added to the SS tax.
    If we had dedicated a portion of the excess that we’ve been paying in to the private sector (i.e. investing in both America’s & global markets) with the excess going into the fund, we could have reaped the benefits of the good market years.
    But at this point, I feel that it would be too little, too late. I’m just glad that actuaries do such a good job of crunching the numbers. And it’s too bad most people in the US couldn’t comprehend the basic math needed to decrypt actuarial tables.
    Medicare & health care, that’s where the real problem is.

  • Future generations are the ones who are going to have to bear the burden and pay the price in this pay-as-you-go system.

    For over 20 years, and for another 10 years or so, SS has been and will be an overpay-as-you-go system. It is not just future generations who could screwed by this if the government defaults on its obligations.

  • I was forced to retire on disability because of my health four years ago at age 49. I don’t believe that receiving $1200.00 a month as being excessive especially after you take out $95 a month for Medicare premium, $156 a month for supplemental insurance $50 for Medicare part D premiums and $100 a month for prescription co-pays and, if McCain cuts benefits, not only me but all seniors and disabled will be punished for living.

    The way my IRA and the stock market is performing now, if I had put my money in McPrivate accounts when I was 20 I would be having McAlpo for supper instead of meatloaf.

    The point is, you may plan on retiring at 65 or 68 or whatever, but crap occurs and without Social Security and Medicare you may be in a world of hurt without a safety net.

  • thank you, wbn, for reminding us that not only is social security a retirement annuity, it’s also a disability annuity and it has a life insurance kicker.

  • Mike said: “howard and lance, I read your comments with great interest, so please correct me if I am wrong on this question. In our current design, 1. we pay government, 2. government spends money as they see fit, 3. kids pay for our retirement. 4. and so on. Is this correct? By the way, I do OK. I just have 4 kids and too many toys. So, you are right. I am poor.”

    Actually, I think you are pretty much correct, except as Howard points out, the Government is spending money because you keep electing the same guy to be your representative and he THINKS you want the programs the Government provides.

    Vote in Fiscal Conservatives as your Representative and Senators and then get back to me.

    But the fact is, unlike JSMcC*n’ts confusion, Social Security is in Surplus, not Deficit. It is not the program that needs to be cut, the rest of the Federal Government does. But JSMcC*n’t thinks he can balance the budget by cutting the portion of the Government that is already balanced. How fair is that?

  • The people who are currently retirement age are the ones who paid for the retirements of the elders before them. The only generation who took a hit was the very first one when the system was bootstrapped. Excessive concern for the young workers is just another way of saying the system shouldn’t exist. You pay in so that the system will be there for you. You do not pay in to support a bunch of freeloading old people who should all get paper routes (the implication of concern for all those hardworking youngsters).

    If young people think social security won’t be there for them, they are stupid and wrong and need educating. You don’t remake a system because of their ignorance. The truth is that none of the alternatives would be there for them either, especially not the so-called private savings plans advocated by Bush (and Obama initially). The only thing private savings would do is give young people a “rainy day” account they could borrow against or tap into when they had temporary financial stress, and then it would be gone and they would wind up old, unable to work, with nothing to fall back on — because that’s what already happens with people’s personal savings accounts.

  • If young people think social security won’t be there for them, they are stupid and wrong and need educating. You don’t remake a system because of their ignorance. -Mary

    They aren’t ignorant; you are.

    If you don’t understand how life expectancy, inflation, declining birth rates, and decreasing wages in the middle class threaten, then you have a lot to learn. If you don’t understand how a redistribution tax works and how the baby boomer generation with put the system in the red, then you have a lot to learn.

    Stop wielding your ignorance like a cudgel and go educate yourself, not that you care because you’re at least 80 years old since you lived in Chicago in the 1930’s when it was 800% black and you were the only white person for 72 miles so you’ll get yours then die before today’s youth has to worry about it.

    The only people who don’t think there is a potential problem with Social Security are people on the verge of eligibility who fear a raise in eligible age. Everyone else recognizes reality.

    You’re flat out wrong, as usual.

  • actually, doubtful, although i wouldn’t phrase it the way mary did, you are the one who is wrong.

    despite your belief that you have a window into heretofore hidden information, the trustees of the social security fund know more than you do, and their annual reports make it very clear that social security is in no trouble whatsoever. in case nothing is done on social security between now and 2048 or so, and assuming productivity growth is poor and immigration lags (i.e., a bunch of worst case scenarios), then either benefits will drop to the funding available (and will still be higher in real terms than they are today) or we will in various ways manipulate the variables of age of retirement, extent of income taxed, and tax rate.

    believe it or not, doubtful, we have no idea how we’re going to fund defense or interest on the national debt in 2048 either, but i guarantee you one thing: we’re still going to be paying off the dollars we borrowed during the bush years.

  • “The piece couldn’t be any less helpful. It’s just horrible reporting that offers readers nothing in the way of real information. The headline, for example, is wrong. Both candidates don’t want to “save” Social Security; one wants to privatize it. Note to Post headline writers: “Abolishing” and “saving” are not synonyms.”

    Good grief. McCain hasn’t said anything remotely like “abolishing” Social Security — he simply hasn’t. Over two dozen countries have personal accounts as part of their Social Security programs, but they don’t view these programs as “abolished.” Criticizing the Post for their reporting while claiming something with no foundation isn’t a big improvement.

    “And the lede is wrong. Both candidates aren’t proposing “dramatic changes” to the system; one wants to the leave the system largely as-is, except for altering the payroll tax cap. There’s nothing dramatic about it.”

    Never in Social Security’s history has there ever been an attempt to tax very high earners — the system simply wasn’t designed to do that (that’s what income taxes are for). Moreover, throughout Social Security’s history taxes and benefits have been calculated on the same wage base (currently $102,000). It’s almost certain that Obama wouldn’t pay extra benefits based on the higher taxes over $250,000. Even many folks on the left have problems with breaking this link. So yes, it’s actually a pretty big change.

  • actually, doubtful, although i wouldn’t phrase it the way mary did, you are the one who is wrong. -howard

    despite your belief that you have a window into heretofore hidden information, the trustees of the social security fund know more than you do, and their annual reports make it very clear that social security is in no trouble whatsoever. -howard

    Oh, I stand corrected then. Whew. Thanks for clearing that up. I didn’t know someone in the government said it was okay. If I had known that, I certainly never would have questioned it. And thanks for telling me we don’t know how were going to pay off huge defense debt. That’s completely irrelevant to the solvency of Social Security, but it is something we should be worried about now. What kind of argument is it to wait until 2048 to solve huge problems when making minor adjustments now might solve them before they become problems?

    You admit yourself in your own comment that there will be solvency issues by 2048, though you termed the causes ‘worst case scenarios,’ I call them ‘real world problems,’ like those I mentioned in my reply to Mary.

    If you had bothered to read any of my previous comment on this, you would have seen that I was talking about Social Security being a problem for the youth of the nation who will be eligible, oh my goodness, in 2048 and beyond. I’m assuming you’re older because your attitude is to fix it later, presumably after you’re dead and gone and have gotten yours, ‘Other generations can deal with decreased benefits, not mine.’

    I prefer not to fix things when they become problems, but to fix them now to prevent them from becoming problems. Part of the problem in America is there is no forward thinking. If there was forward thinking, we wouldn’t be having this discussion because Social Security eligibility would be tied to something variable, like average lifespan and benefits would be needs based. But they aren’t because America can’t think past the end of it’s nose when solving problems.

    So you can come at me with your demeaning arguments, but like Mary, you’re flat out wrong, and worse than her you recognize the potential problem but are either to lazy or greedy to deal with it now.

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